Bank of America Makes Investment in Countrywide Financial
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Buys convertible preferred stock for $2 billion
CHARLOTTE, N.C., Aug. 22 /PRNewswire/ -- Bank of America Corporation today announced it has made an investment in Countrywide Financial Corporation, the largest mortgage lender in the United States.
Bank of America will invest $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.
"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 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
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.
SOURCE Bank of America