NEW YORK (Reuters) - A U.S. appeals court on Wednesday revived a lawsuit by the Federal Deposit Insurance Corp against five banks including Credit Suisse Group AG (CSGN.S) stemming from the sales of mortgage-backed securities ahead of the 2008 financial crisis.
The 2nd U.S. Circuit Court of Appeals in New York ruled that a lower-court judge had erred in dismissing the FDIC lawsuit, which also named units of HSBC Holdings Plc (HSBA.L), Royal Bank of Scotland Group Plc (RBS.L), UBS AG (UBSG.S) and Deutsche Bank AG (DBKGn.DE) as defendants.
The FDIC declined to comment as did Deutsche Bank, Credit Suisse and HSBC. Representatives for the other banks did not immediately respond to requests for comment.
The FDIC sued the banks in 2012, accusing them of violating a federal securities law in connection with the sale of $140.5 million in mortgage-backed securities in 2007 and 2008 to Citizens National Bank and Strategic Capital Bank. Both banks later failed.
Another panel of the same appellate court in May revived another lawsuit by the FDIC against several banks over similar claims. The U.S. Supreme last week declined to review that case.
In both cases, the court held that a federal law passed in 1989 after the savings and loan crisis extended the time period that the FDIC could sue on behalf of two failed banks that it took into receivership.
The latest ruling reversed a March 2015 decision by U.S. District Judge Laura Taylor Swain in Manhattan, who concluded that the FDIC had waited too long to sue the banks.
The case is FDIC v Credit Suisse First Boston Mortgage Securities Corp et al, 2nd U.S. Circuit Court of Appeals, No. 15-1037.
Editing by Chizu Nomiyama and Jeffrey Benkoe