(Updates with complaint starting in second paragraph.)
Dec. 30 (Bloomberg) -- Credit Suisse Group AG, the second- biggest Swiss bank, was sued in New York state court by Dutch pension fund Stichting Pensioenfonds ABP over losses on investments in mortgage securities.
Credit Suisse sold securities that were backed by low- quality loans and turned out to be “far riskier” than promised, ABP said in a complaint filed yesterday in Manhattan.
The pension fund said Zurich-based Credit Suisse knew of “the wholesale and systematic abandonment” of underwriting guidelines by loan originators, leading to high default and delinquency rates by borrowers.
ABP said it has suffered “substantial losses” on the securities and that it’s increasingly probable that it would not obtain the full payments it expected. A lawyer for ABP couldn’t be reached for comment about the amount of securities at issue in the lawsuit.
Steven Vames, a spokesman for Credit Suisse, declined to immediately comment.
The case is Stichting Pensioenfonds ABP v. Credit Suisse Group AG, 653665-2011, New York State Supreme Court (Manhattan).
--Editors: Mary Romano, David E. Rovella
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