Countrywide: BofA making $2B investment |
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Thu, 23 Aug 2007 00:10
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LOS ANGELES (AP) - Countrywide Financial Corp. said Wednesday that Bank of America Corp. has made an investment of $2 billion in the company, a deal that comes as the nation's largest mortgage lender tries to weather a credit crunch that's rocked Wall Street and the mortgage industry.The transaction was completed and funded Wednesday, Countrywide said.'Bank of America, with $1.5 trillion in assets, has the largest retail banking franchise in the U.S. and is one of the most respected companies in the world,' Angelo R. Mozilo, Countrywide's chairman and chief executive, said in a statement.'Bank of America's investment in Countrywide represents a vote of confidence and strengthens our balance sheet, enabling us to position Countrywide for future growth and success,' Mozilo said.Under the terms of the deal, Charlotte, N.C.-based Bank of America acquired $2 billion in the form of nonvoting, convertible preferred stock yielding 7.25 percent annually, Countrywide said.The shares can be converted into common shares of Countrywide at $18 per share, with certain restrictions, Countrywide said.Countrywide shares jumped almost 19 percent to $25.91 in after-hours trading. Before Countrywide's announcement, the shares had closed the regular session up 3 cents at $21.82.Copyright 2007 Associated Press. All rights reserved. This material may not be published, broadcast, rewritten, or redistributed.
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