The Swiss bank said it has, in principle, reached a settlement with the Department Of Justice that would see it pay $2.48 to cover civil claims.

Credit Suisse today said it has reached a settlement in principle with the US Department of Justice connected to its legacy residential mortgage-backed securities business, relating to a period 2005 to 2007.

This settlement will, if fully agreed, release Switzerland’s second-largest bank from potential civil claims by the DOJ related to its securitisation, underwriting and issuance of RMBS. Under the terms of the settlement, Credit Suisse would pay to the DOJ a civil monetary penalty of $2.48 billion. In addition, Credit Suisse would provide consumer relief totalling $2.8 billion over the course of five years following the settlement.

This matter is subject to the negotiation of final documentation and approval by the Credit Suisse board of directors.

Credit Suisse will take a pre-tax charge of approximately $2 billion in addition to its existing reserves against these matters. This will be taken in the Zurich-listed bank’s fourth-quarter financial results.