Charlotte, NC Bank of America to buy Countrywide (still)
January 21st, 2008 Categories: Charlotte Business, Real Estate News
Charlotte, NC| Bank of America still planning on buying out of Countrywide
by Bob McDonald (Research and Marketing Assistant)
First and foremost I hope everyone is enjoying a relaxing day away from work to commemorate Martin Luther King day. Martin Luther King Jr. was an amazing man who showed that there is power in a dream and that one person can make a difference. Normally I’d be working the 8:30-6 shift at East Carolina University’s Online Programs Office (it pays the bills while I’m finishing up an MBA) but it’s MLK day so no school, no work for me!
I’ve been researching the Countrywide purchase and did want to post this -about a still wobbly merger that could add some traction to the housing correction. Last week everyone heard and was excited (Wall Street Journal and Reuters) that Bank of America (BoA) planned on following-up its 2 billion August investment in Countrywide with outright purchase of the company in the 3rd quarter. Countrywide, the largest mortgage lender in the US was in deep trouble before BoA’s August bailout. I believe this is good news for any individual interested in buying, selling, or investing in real estate. BoA has the deep pockets to withstand the sub-prime situation and keep Countrywide intact. This week fears were swirling again as analysts suggested that BoA had overvalued Countrywide at $3.8 billion or $6.55 a share. While BoA and Countrywide representatives both refused to comment on the situation the deal is still believed to go through as BoA had several broadly written clauses in the initial contract for further re-evaluation of Countrywide’s worth, if their situation deteriorates further.
If the deal does go through it would make BoA the largest mortgage lender in the country. BoA is the area’s third largest employer with almost 14,000 jobs in the Charlotte metro area; this number would probably grow with an acquisition of Countrywide, and its huge portfolio of loans. That, plus Countrywide access to BofA customers? This could be a big addition for the Charlotte area in the years to come in terms of job growth and development. That would be a a win/win, and for Countrywide, preferable to the alternative.
Thanks for reading, don’t be shy and comment.
Sources
Mortgage News Daily
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Terry just another interesting development in the mortgage industry. - Ashley