Daily News: July 2, 2012

WSJ: BofA’s $40 Billion-Plus Blunder


In an article posted by the Wall Street Journal, the writer said, according to people close to the bank, that Bank of America’s ill-fated decision to acquire Countrywide Financial has already cost the lender more than $40 billion in real-estate losses, legal expenses and settlements with state and federal agencies.

The Journal added that the tally could go higher. Bank of America has said it could face an additional $5 billion in possible losses, and scores of lawsuits seeking to pin Countrywide’s liabilities on Bank of America are pending in courtrooms around the U.S.

The Journal article comes on the fourth anniversary of a transaction that was characterized at the time as a bargain at $2.5 billion, but is now being portrayed as “the worst deal in the history of American finance – hands down”, by a banking and finance professor at the University of North Carolina, the Journal said.

To read the Wall Street Journal article, click here. (subscription required)