Beginning in 2008, certain mortgage industry participants have implemented their own programs to modify troubled  residential mortgages. For example, Bank of  America and Countrywide Financial Corporation entered into a settlement with  various states’Attorneys General that requires the creation of a proactive home retention program that is intended to  systematically modify troubled mortgages to allow for up to $8.4 billion in interest rate and principal reductions for nearly  400,000 Countrywide customers. In addition, the FDIC, initially in its role as conservator for IndyMac Bank, also implemented  broad modification procedures for institutions acquiring failed institutions under loss-share agreements.  In 2010, the Administration announced $7.6 billion of funding under EESA  to 18 states and the District of Columbia  where the average price for homes had fallen by more than 20% from its peak price and to states with the highest concentration  of their populations living in counties with unemployment rates greater than 12 percent or unemployment rates that were at or  above the national average. These funds, under the “Hardest Hit Fund” Program, have been made available to eligible states and  local housing finance agencies to assist borrowers, including unemployed borrowers, borrowers that owe more than the current  value of their home, and borrowers with home equity loans or second-liens.  The U.S. Department of the Treasury has provided  guidelines for funding and other eligibility requirements under the Hardest Hit Fund Program and homeowners in participating  states can apply for the Hardest Hit Fund through 2017 or until all program funds are allocated for homeowner assistance. In February 2012, the U.S. Department of Justice, HUD and 49 state attorneys general (excluding Oklahoma) announced  a $25 billion global settlement with Ally Financial Inc., Bank of America Corporation, Citibank, JPMorgan Chase Bank, N.A.  and Wells Fargo Bank N.A. According to the announcement, the settlement resolves many of the potential state and federal civil  charges about allegations of improper foreclosure practices, including “robosigning.” Consumer relief payments in the form of,  among other things, permanent principal reductions on eligible delinquent loans are to comprise $17 billion of the settlement.  The settlement also includes $3 billion to facilitate refinancing for eligible borrowers who are not delinquent and are  underwater on their mortgages. An additional $5 billion will be paid in cash to the U.S. government and the participating state  governments, of which $1.5 billion is to be used for eligible borrowers who have lost their homes to foreclosure between 2008  and 2011. In addition, the participating banks have agreed to implement a detailed set of national servicing standards. The impact of the settlement agreement on the housing market is unclear at this time as the ef fectiveness of the settlement  is largely dependent on the banks’ implementation of it. The banks have been given three years to distribute the aid and the  settlement relief is not available to those homeowners whose mortgages have been sold to the GSEs, which represent nearly  half of outstanding mortgages in the U.S. In 2006, Congress enacted the private mortgage insurance tax deduction in order to foster homeownership.  The deduction  was enacted on a temporary basis and it expired at the end of 201 1. In January 2013, Congress passed the American Taxpayer  Relief Act, which extended the private mortgage insurance tax deduction retroactively for one year and prospectively for one  year through 2013. In 2012, legislation was also introduced that would make the private mortgage insurance deduction  permanent. The proposed legislation is likely to be reintroduced in the 1 13th Congress and considered as a part of the  comprehensive tax reform debate. We cannot predict whether the tax deduction will be made permanent and if not, whether it  will be further extended after 2013. The Basel II Capital Accord (“Basel II”) represents a proposal by the Basel Committee on Banking Supervision  (“BCBS”), consisting of bank supervisors and central bankers from 13 countries, to revise the international standards for  measuring the adequacy of a bank’ s capital. The implementation of Basel II is intended to promote a more forward-looking  approach to capital supervision and to ensure greater consistency in the way banks and banking regulators approach risk  management around the world. The implementation of Basel II may af fect the demand for and capital treatment provided to  mortgage insurance and the capital available to lar ge domestic and internationally active banking institutions for their mortgage  origination and securitization activities. Our primary mortgage insurance business and opportunities may be significantly impacted by the implementation of  Basel II in the U.S. due to the adoption of jurisdiction specific prudential standards that may lead to change in demand for and  acceptance of mortgage insurance by lar ge domestic and internationally active banking institutions.  The implementation of  Basel II and adoption of standards is subject to the views and discretion of the local banking supervisors and its implementation  is expected to vary across national jurisdictions. 57 C. Basel II and Basel III Capital Accords 10. Mortgage Insurance Tax Deduction