Guide Note:
Bank of America (BofA) acquired ailing Countrywide in a $4 billion all-stock transaction on January 11, 2008. The acquisition comes 5 months after BofA invested $2 billion in Countrywide. BofA was able to purchase the nation's largest mortgage lender at 2.9 times Countrywide's projected 2009 earnings.1
Countrywide Fast Facts:
- 1.04% of loans in Countrywide's portfolio resulted in foreclosures1
- Countrywide shareholders would receive 0.1822 of Bank America stock for each Countrywide share2
- In December 2007, 7.2% of Countrywide's loans were delinquent2
- Countrywide oversees nearly $1.4 trillion in loan assets2
- Countrywide paid a dividend of 7.25% on preferred stock during the August 2007 BofA $2 billion cash injection
BofA Fast Facts:
- BofA plans to operate Countrywide separately under the Countrywide brand
- BofA expects $670 million in after-tax cost savings from the transaction2
- Bank of America will absorb Countrywide's loan portfolio
- In August 2007, Bank of America agreed to provide $2 billion in relief financing to Countrywide
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