CALABASAS, Calif., Aug. 22 /PRNewswire/ -- Countrywide Financial
Corporation (NYSE: CFC), a diversified financial services provider and the
leading mortgage lender and servicer in the U.S. announced today that it
has received a $2 billion strategic equity investment from Bank of America
(NYSE: BAC). The transaction was completed and funded today.
"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," said Angelo R. Mozilo, chairman and chief executive officer of
Countrywide. "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," added Mr. Mozilo. "This
transaction benefits all of Countrywide's constituents, including
investors, shareholders, mortgage customers, deposit holders, business
partners and employees," concluded Mr. Mozilo.
"We believe that in the current turmoil the stock market has been
underestimating the value in Countrywide's operations and assets," said
Kenneth D. Lewis, Bank of America chairman and chief executive officer.
"This investment reflects our confidence in their business and recognizes
the importance of the company in providing home financing across the
country. We hope this investment will be a step toward a return to a more
normal liquidity in the mortgage markets. Countrywide has a strong mortgage
origination business and it services the mortgages of one in seven American
households."
Bank of America has invested $2 billion in the form of a non-voting
convertible preferred security yielding 7.25 percent annually. The security
can be converted into common stock at $18 per share, with resulting shares
subject to restrictions on trading for 18 months after conversion.
The agreement between the parties is subject to customary standstill
restrictions prohibiting the acquisition of beneficial ownership of
additional voting securities of Countrywide.
Goldman Sachs & Co. acted as financial advisor to Countrywide and
Wachtell, Lipton, Rosen & Katz served as legal advisor. Bank of America
Securities acted as financial advisor to Bank of America, and Cleary,
Gottlieb, Stern & Hamilton served as legal advisors.
About Countrywide
Founded in 1969, Countrywide Financial Corporation is a diversified
financial services provider and a member of the S&P 500, Forbes 2000 and
Fortune 500. Through its family of companies, Countrywide originates,
purchases, securitizes, sells, and services prime and nonprime loans;
provides loan closing services such as credit reports, appraisals and flood
determinations; offers banking services which include depository and home
loan products; conducts fixed income securities underwriting and trading
activities; provides property, life and casualty insurance; and manages a
captive mortgage reinsurance company. For more information about the
Company, visit Countrywide's website at http://www.countrywide.com.
This Press Release contains forward-looking statements within the
meaning of Section 21E of the Securities Exchange Act of 1934, as amended,
regarding management's beliefs, estimates, projections, and assumptions
with respect to, among other things, the Company's future operations,
business plans and strategies, as well as industry and market conditions,
all of which are subject to change. Actual results and operations for any
future period may vary materially from those projected herein and from past
results discussed herein. Factors which could cause actual results to
differ materially from historical results or those anticipated include, but
are not limited to: increased cost of debt; reduced access to corporate
debt markets; unforeseen cash or capital requirements; a reduction in
secondary mortgage market investor demand; increased credit losses due to
downward trends in the economy and in the real estate market; increases in
the delinquency rates of borrowers; competitive and general economic
conditions in each of our business segments such as slower or negative home
price appreciation; changes in general business, economic, market and
political conditions in the United States and abroad from those expected;
reduction in government support of homeownership; the level and volatility
of interest rates; changes in interest rate paths; changes in debt ratings;
changes in generally accepted accounting principles or in the legal,
regulatory and legislative environments in which Countrywide operates; the
judgments and assumptions made by management regarding accounting estimates
and related matters; the ability of management to effectively implement the
Company's strategies; and other risks noted in documents filed by the
Company with the Securities and Exchange Commission from time to time.
Words like "believe," "expect," "anticipate," "promise," "plan," and other
expressions or words of similar meanings, as well as future or conditional
verbs such as "will," "would," "should," "could," or "may" are generally
intended to identify forward-looking statements. The Company undertakes no
obligation to publicly update or revise any forward-looking statements or
any other information contained herein.
About Bank of America
Bank of America is one of the world's largest financial institutions,
serving individual consumers, small and middle market businesses and large
corporations with a full range of banking, investing, asset management and
other financial and risk-management products and services. The company
provides unmatched convenience in the United States, serving 57 million
consumer and small business relationships with more than 5,700 retail
banking offices, more than 17,000 ATMs and award-winning online banking
with more than 22 million active users. Bank of America is the No. 1
overall Small Business Administration (SBA) lender in the United States and
the No. 1 SBA lender to minority-owned small businesses. The company serves
clients in 175 countries and has relationships with 98 percent of the U.S.
Fortune 500 companies and 80 percent of the Fortune Global 500. Bank of
America Corporation stock (NYSE: BAC) is listed on the New York Stock
Exchange. http://www.bankofamerica.com
SOURCE Countrywide Financial Corporation
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Related links:
http://www.countrywide.com
http://www.bankofamerica.com
CONTACT:
Countrywide Financial Corporation Media,
1-800-796-8448, pressroom@countrywide.com, or Investors, David
Bigelow or Lisa Riordan, +1-818-225-3550, both of Countrywide
Financial Corporation; or Bank of America, Investors, Kevin
Stitt, +1-704-386-5667, or Lee McEntire, +1-704-388-6780, or
Leyla Pakzad, +1-704-386-2024, or Media, Scott Silvestri,
+1-704-604-8567, scott.silvestri@bankofamerica.com, all of Bank
of America
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