Oregon Mortgages

More Countrywide News

Well there is some more good news for Countrywide today. It appears that Bank of America Corp. invested $2 Billion into the largest lender in America to help them live to fight another day. They purchased non-voting preferred stock that can be converted into Countrywide common stock at a price of $18.00 per share which is roughly 17.5% below what the stock was trading for at close Wednesday. If they do convert the stock it would get them roughly a 16% stake in Countrywide Financial. At this point it is hard to say whether Warren Buffett is trying to purchase them as a report previously stated. I guess we’ll have to wait and see.

Bank of America’s CEO Kenneth Lewis said, “We hope this investment will be a step toward a return to a more normal liquidity in the mortgage markets. In the current turmoil the stock market has been underestimating the value in Countrywide’s operations and assets.”

There was definitely some scary times for Countrywide who was fairly close to being downgraded to “junk bond” that would have most likely doomed them. I’m not a financial guru when it comes to the stocks but I was never THAT worried about Countrywide going under and now it appears they will be able to rebound.