... Bank of America would utterly dominate U.S. residential real estate finance. The newly combined Bank of America, based on MortgageDaily.com 2007 third quarter origination numbers, would have originated $142 billion in mortgage and home-equity financings. The next closest: Wells Fargo at $68 billion.
... For Bank of America the cost savings inherent in combining Countrywide's market-leading residential lending platform with its own fourth-place effort are no doubt tempting. The bank would also pick up millions of customers - as well as thousands of depositors from Countrywide's own bank - to peddle a variety of higher-margin personal finance offerings. It would also, presumably, bail out the $2 billion investment Bank of America made in the lender in August. Prior to the news, the bank was out a cool $1.4 billion on the trade.
2 comments:
The more i think about this deal the more it makes sense long term and seem like a really cheap way to grow.
Obviously the write offs are a risk, but once they get past them, this should pan out to bring more banking business and more scale on the mortgage side.
I agree. you will get a lot of skeptics now that it is throwing good money after bad but it is a bold move that can pay off tremendously for BofA growth.
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