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fencerider2
08-22-2007, 08:59 PM
If there not why would they go to the discount window today and borrow 500m?
Amortized
08-22-2007, 09:09 PM
If there not why would they go to discount window today and borrow 500m?

maybe getting ready for the BOA-CW buyout/merger to become THE largest Lender and Servicer. BOA did invest $2B into CW, we'll see what happens.
Citi, JPMorgan Chase, Bank of America and Wachovia all took out $500M loans.
fencerider2
08-22-2007, 09:25 PM
maybe getting ready for the BOA-CW buyout/merger to become THE largest Lender and Servicer. BOA did invest $2B into CW, we'll see what happens.
Citi, JPMorgan Chase, Bank of America and Wachovia all took out $500M loans.


Lets be honest, the whole deal has the smell of fish. BOA has stated assets stated in the hundreds of billions.

Why borrow 500 million at the window for 5.75%?

CFC has a book value of $ 7.50 per share and thats probably not marked to market.
Amortized
08-22-2007, 09:47 PM
Lets be honest, the whole deal has the smell of fish. BOA has stated assets stated in the hundreds of billions.

Why borrow 500 million at the window for 5.75%?

CFC has a book value of $ 7.50 per share and thats probably not marked to market.

683 billion in deposits. can't just do whatever you want with deposits. now take a step back for a second and put yourself in BOA shoes. don't look at the CW financials, just looking at their figures, its a horrible investment. look at all the customers CW has. Now consider all the services BOA can cross sell. CW's 1.8 Million mortgage customers is worth itīs weight in GOLD to a Bank who offers, Visa, Master Card, car loans, equity loans, checking accounts, money market account, stock accounts, insurance etc.
boa wouldn't care if it was $12.50 per share. They have a chancec to aquire the largest home lender and become THE largest lender and servicer........not for auto loans, not for home loans, not for credit cards, student loans, but ALL loans. Think of all the services they can provide. Look at what CITI did a few years ago when they got into insurance, mortgages, banking, and investments. BOA is all about being the best and the biggest and once they aquire CW they're gonna pull away from JP, Citi, Wells and Wachovia like they're standing still.
fencerider2
08-23-2007, 07:35 AM
683 billion in deposits. can't just do whatever you want with deposits. now take a step back for a second and put yourself in BOA shoes. don't look at the CW financials, just looking at their figures, its a horrible investment. look at all the customers CW has. Now consider all the services BOA can cross sell. CW's 1.8 Million mortgage customers is worth itīs weight in GOLD to a Bank who offers, Visa, Master Card, car loans, equity loans, checking accounts, money market account, stock accounts, insurance etc.
boa wouldn't care if it was $12.50 per share. They have a chancec to aquire the largest home lender and become THE largest lender and servicer........not for auto loans, not for home loans, not for credit cards, student loans, but ALL loans. Think of all the services they can provide. Look at what CITI did a few years ago when they got into insurance, mortgages, banking, and investments. BOA is all about being the best and the biggest and once they aquire CW they're gonna pull away from JP, Citi, Wells and Wachovia like they're standing still.


But what percentage of CW customer's are one's that BAC would really want, after all the whole institution was built on fee's from mostly sub prime loan's.

Since the sub prime loan biz is mostly going away what's left at CW?
Amortized
08-23-2007, 10:48 AM
But what percentage of CW customer's are one's that BAC would really want, after all the whole institution was built on fee's from mostly sub prime loan's.

Since the sub prime loan biz is mostly going away what's left at CW?

subprime borrowers are excellent candidates for credit cards (late fees are one of the biggest profit centers out there) and bank accounts.
Young,Fablous,&Broke
08-23-2007, 10:56 AM
What is the actual rate of foreclosure on sub primes, is it over 50%?
Serbonze
08-23-2007, 11:13 AM
With the purchase of the preferred stock, BoA also negotiated the right to match any proposal Countrywide entertains regarding a sale of the company.
Amortized
08-23-2007, 11:30 AM
What is the actual rate of foreclosure on sub primes, is it over 50%?
not even close.
Young,Fablous,&Broke
08-23-2007, 11:44 AM
So this isnt a HUUUGGE deal.....
Amortized
08-23-2007, 11:55 AM
So this isnt a HUUUGGE deal.....


if you consider 14% of subprime loans resulting in foreclosure HUUUUUUGE.

2.2 million: Approximate number of families who MAY lose their homes and up to $164 billion of accumulated wealth due to foreclosure, according to the Center for Responsible Lending.
Joe
08-23-2007, 12:49 PM
So this isnt a HUUUGGE deal.....

It's as big of a deal as the media made the Vick case seem...
Amortized
08-23-2007, 12:59 PM
It's as big of a deal as the media made the Vick case seem...


so its the end of the world..............or just close to it?
Young,Fablous,&Broke
08-23-2007, 12:59 PM
Well he is an asshole.
BAMF
08-23-2007, 01:05 PM
I like Wachovia better than BoA.
Amortized
08-23-2007, 01:10 PM
I like Wachovia better than BoA.

tell us how you really feel.
BAMF
08-23-2007, 01:21 PM
tell us how you really feel.

If I did that nobody would talk to me anymore, though. :-(
Serbonze
08-23-2007, 03:29 PM
Countrywide Gives Bank of America $700 Million Gain (Update2)

Aug. 23 (Bloomberg) -- Bank of America Corp., the second- biggest U.S. lender, is already up about $700 million on its $2 billion preferred stock investment in Countrywide Financial Corp.


http://www.bloomberg.com/apps/news?pid=20601087&sid=aYLh1_Ac25IY&refer=home

I would say that was a good investment.
Joe
08-23-2007, 03:38 PM
I would say that was a good investment.

Just a dead cat bounce... all the banks will be bleeding in the streets one day, you watch...

I'll be waiting ready to come in and pick the meat when it happens, you can count on it!!
fencerider2
08-23-2007, 04:33 PM
Countrywide Gives Bank of America $700 Million Gain (Update2)

Aug. 23 (Bloomberg) -- Bank of America Corp., the second- biggest U.S. lender, is already up about $700 million on its $2 billion preferred stock investment in Countrywide Financial Corp.


http://www.bloomberg.com/apps/news?pid=20601087&sid=aYLh1_Ac25IY&refer=home

I would say that was a good investment.


I would like to know how Bloomberg came up with that 700 million profit.
Joe
08-23-2007, 04:45 PM
I would like to know how Bloomberg came up with that 700 million profit.

Now you're gonna say that Bloomberg isn't a valid source too?
fencerider2
08-23-2007, 05:01 PM
Now you're gonna say that Bloomberg isn't a valid source too?


They don't say how they came up with the profit, you really need to know how much they paid for the preferred.


I do know its a better deal for BOA if the stock drops below $18, hows that for a boner. They have a conversion rate if it drops below $18 they get more shares to make up the difference for the loss.

Since the outstanding shares are 576 million and BOA owns 111 million at $18, it would be in the best interest of BOA for the shares to drop lower than $18.

So say the stock dropped to $10, at that point BOA would be entitled to a lot more shares, a sweet way to take control over CFC for a small investment.