Goldman Sachs (NYSE: GS) said it could lose up to $3.4 billion from lawsuits and related costs over various securities that blew up in the credit crisis. The bank said the estimate was likely at the upper end of a range of "reasonably possible" losses from legal proceedings.

This does not appear to loom as a significant risk. In many ways, Goldman has put the bulk of legal costs behind it. Compare that situation with that of the big consumer banks, such as Bank of America and JPMorgan Chase. The latter recently said losses could hit $4.5 billion.

"JPMorgan's comment is worth noting because the bank has been among the more conservative U.S. financial institutions in bracing for the wave of legal challenges tied to the subprime meltdown and the mortgage mess. The bank added repeatedly to its litigation reserves in 2010, and legal costs soared last year to $7.4 billion from $161 million a year earlier," according to Fortune.

The potential legal costs stem in large part from the foreclosure fiasco and the legal fallout that has generated in terms of suits from regulators, customers and, of course, MBS bondholders. We may see other consumer banks add to their reserves aggressively, unlike Goldman.

For more:
- here's the article from Fortune
- here's a Housing Wire article on Goldman

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