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Bank of America Corporation Message Board

  • bobcatvince bobcatvince Jan 30, 2007 11:42 AM Flag

    Countrywide speculation downplayed

    This is excerpted from the Charlotte Observer downplaying the Countrywide takeover speculation:

    In a research report Friday, Friedman, Billings, Ramsey & Co. analyst Gary Townsend downplayed the possibility of a deal, although he said an acquisition was workable financially.

    Bank of America "wants a larger mortgage market share ... but it has little appetite for a huge mortgage servicing platform," Townsend wrote in the report. "We consider a joint venture more likely than a purchase."

    Acquiring Countrywide would once again push Bank of America up against the federal cap that limits banks to gaining 10 percent of deposits through acquisitions. The company has been shedding deposits for the past year, raising the eyebrows of analysts. It now holds about 9 percent of the nation's deposits. Countrywide, with about $56 billion in domestic deposits, holds close to 1 percent.

    Such a deal would also make Bank of America a large player in lending to borrowers with spotty credit, a business it has largely avoided in recent years. Countrywide is one of the nation's largest originators of mortgage loans with high interest rates.

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