JPMorgan and Citigroup Announce Moratorium on Foreclosures

By: • Fri, Feb 13 2009, 12:31 PM

Three major U.S. financial institutions have announced they will halt foreclosures after coming under intense pressure from U.S. politicians on Wednesday to do something to help U.S. citizens weather the financial crisis.

Citigroup announced it will be halting foreclosures starting Feb. 12. The bank said it will uphold this commitment until U.S. President Barack Obama has finalized the details of his plan to modify mortgage loans to benefit U.S. residents at risk of losing their homes.

Minutes later, JPMorgan announced it will also put a moratorium on foreclosures for a three-week period, or until March 6. Morgan Stanley later made a similar statement.

Bank of America CEO Ken Lewis already announced a similar pledge earlier this week in a hearing before the House Financial Services Committee.

On Wednesday, CEOs from Bank of America, Goldman Sachs, Citigroup, Morgan Stanley, Wells Fargo, JPMorgan Chase, Bank of New York Mellon and State Street all faced harsh criticism from lawmakers for allowing the financial system to come crashing down in 2008.

All of the executives said they will do what they can to boost lending and stem foreclosures to aid the U.S. economic recovery.