Angelo Mozilo, slated to step down as chief executive of Countrywide Financial Corp. on Tuesday, is departing with a devalued reputation partly because he stayed too long and at times ran the publicly traded mortgage lender as if it were his own company.I think this acquisition will hurt Bank of America over the next few years, but if you look out five years or more, Bank of America may dominate America's mortgage industry.
Bank of America Corp. plans to complete its acquisition of Countrywide on Tuesday, and the 69-year-old Mr. Mozilo will retire. Bank of America will become the nation's biggest home-mortgage lender, using Countrywide's loan-processing technology and nationwide presence—but not its brand, which is scheduled to vanish after a transition period.
Until about a year ago, Mr. Mozilo was little known outside his industry. In the mortgage world, he was considered a visionary. He helped found Countrywide in 1969 and built it into the nation's biggest and most efficient mortgage lender. Then came an abrupt fall as defaults surged and investors lost confidence.
Countrywide's reaction to the crisis was to push for more market share in the first half of 2007, aiming to benefit from the collapse of rivals. That backfired when Countrywide could no longer find buyers for many of the loans it had originated, leaving the company stuck with billions of dollars of high-risk mortgages. Former executives say Countrywide, which still accounts for about one in every seven home loans made in the U.S., was so focused on increasing volume that it neglected quality control.
Mr. Mozilo made things worse for himself by postponing his retirement and by making frequent, heavy sales of Countrywide stock. He offered discounts on loans to friends so frequently that FOA—for Friends of Angelo—became a familiar loan type among employees.
If you'd like to wish Angelo Mozilo a fond farewell, you may do so in the comments.
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I hope that SOB goes to jail, along with Senator Dodd and Conrad.
ReplyDeleteDear Angelo,
ReplyDeleteGood Luck in Prison.
The big house crew 'yard boys' are eagerly awaiting your arrival. They loove the yellow jaundice look you have pioneered.
Bring your own soap and keep your back to the wall and you should be able to sit comfortably around 2012(when the housing market hits bottom, well after your bottom has been hit, many, many times).
Keep up your Righteous Attitude. The jailers loove that too.
Look at the bright side, Ange, you will have anew wife named Joe and you will not hear a woden door close for many months at a time.
As you have recently stated in your tearful farewell, I sinvcerely hope you 'reap what you sowed" - BIG TIME.
Ponzi would have been Proud.
Putting him on my "piss on their grave" tour. Cheney, Rummy, the usual.
ReplyDeleteWow...there are not only Friends of Angelo loans, but in each division, whomever was the President, there were also Friends of ______ loans. In addition, if any employee were to question the F of A (friend of Angelo) or F of (any of the senior executives) that employee would get a quick push out the door, never to be heard from in the mortgage industry again. The Friend status was not only for individual loans, but for bulk loans AND for special servicing amounts from Fannie Mae and Freddie Mac. Yes, there are numerous people at the company that have this information and they are probably shaking in their shoes, as they should be.
ReplyDeleteI worked for Angelo Mozilo between 1977 and 1982 and was his highest producing branch manager. I was also one of four regional managers for all of his branches. At that time Angelo would never sacrifice quality for quantity and never higher any commissioned Loan Officers. We were all paid on a salary and it worked quite well. I am sorry for him that his image is tarnished. I am still alive and originating loans based on quality which I attribute to Angelo's training.
ReplyDelete