Countrywide Drops Below Bank of America's Deal Price |
| Bloomberg - Sep 6, 2007 |
Countrywide Financial Corp. shares dropped below $18, wiping out the $700 million paper profit Bank of America Corp. made when it invested $2 billion in the nation's biggest mortgage lender two weeks ago.
Bank of America, the second-largest U.S. bank, bought preferred stock on Aug. 22 that can be converted to common shares at $18. Countrywide, which surged to $24.46 the day after the deal was announced, fell as low as $17.95 today on the New York Stock Exchange.
For Countrywide, the cash infusion erased the threat of bankruptcy after a global credit crunch sapped investor demand for mortgages. Buying a stake in the Calabasas, California-based lender reflected Bank of America Chief Executive Officer Kenneth Lewis's determination to generate profit growth at home, while his competitors expand abroad.
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- Posted: 2007-09-06 11:10:49
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