Bank of America Closes on Countrywide
Bank of America (BAC) officially closed their deal with Countrywide (CFC) only a few days after major legal action against the troubled mortgage company had been revealed. State’s Attorneys’ General continue to take action against the lender.
The nation’s largest bank wanted to close quickly on the deal before legal action worsened. BofA will continue to treat Countrywide as its own unit. The following email was sent out to Countrywide’s network of brokers today:
Dear Valued Business Partner:
Countrywide®, America’s Wholesale Lender® is pleased to announce that as of July 1, 2008, Countrywide Financial Corporation has merged with Bank of America. We have become America’s leading home loan provider and we know with this position comes great responsibility to
our communities and our customers. We are committed to responsible lending practices, meaningful community development initiatives and an industry-leading suite of products. Add to that our financial strength and stability and the result is an institution committed to providing you a world-class experience.
We are committed to the future of the business and very excited about the opportunities this merger provides to our broker Business Partners and mutual customers. In the months to come, you will receive updated information about these opportunities as we advance with our integration efforts.
In the meantime, there’s no need for you or your customers to do anything differently in the way you do business with us. Continue to work directly with your Account Executive and wholesale loan fulfillment team members and continue to leverage www.cwbc.com as you do today. If any changes are required in the future, we’ll be sure to notify you well in advance. We want to make the transition as smooth as possible.
We realize the merger brings many questions and in order to respond to them, a customer Web site has been created to provide more information for our mutual customers including answers to frequently asked questions. Please visit www.bankofamerica.com/mergernews to learn more. Thank you.
Countrywide has already seen some benefits to the merger as its debt has been upgraded to the same levels as BofA. The legal charges will probably go away since if Countrywide is found liable for essentially originating Option ARMs, the entire industry must be indicted as well. However, the costs of defending the mortgage branch could be substantial.
Nevertheless, BofA’s rushed close of the Countrywide deal is indeed reminiscent of the ostrich in the picture. If we bury Countrywide in the sand of America’s largest bank, all its problems will go away.