STOCK MARKET WATCH - Wednesday, 11 January 2012

[Demeter]

62. Treasury emails outline Countrywide's mortgage crisis

http://m.mcclatchydc.com/dc/db_112234/contentdetail.htm?contentguid=00AEykt0&full=true#display

As Bank of America Corp. finalized plans to buy the ailing Countrywide Financial Corp., government officials traded emails about the mortgage lender's troubles, rumors that regulators had a hand in the deal, and the housing market's role in the looming recession.

The newly released messages between U.S. Treasury Department officials span the turbulent months between August 2007, when Bank of America first invested in Countrywide, and January 2008, when the Charlotte bank announced plans to buy the nation's biggest mortgage lender.

Bank stakeholders still lament the acquisition, which led to losses and legal troubles that have continued to pummel the company.

The nearly 40 pages of emails, obtained by the Charlotte Observer after a public-records request, provide a real-time look at the crisis unfolding a year before the financial meltdown. Subject lines warn of Countrywide bankruptcy rumors. Analysts discuss an imminent mortgage-market collapse. And the Treasury's communications staffers scramble to deflect questions on whether government officials pressured the bank into the deal - questions that linger today among some Bank of America shareholders and analysts...MORE