A huge mistake is weighing on Bank of America.
The bank’s acquisition of mortgage lender Countrywide in 2008 has cost BofA more than $40 billion, the Wall Street Journal reports. The merger turned BofA into a big player in the mortgage market right before the housing bubble burst and since the bank has suffered massive real estate losses and paid out huge sums in legal fees and settlements with state and federal agencies.
To put the sum in perspective, JPMorgan Chase’s infamous trading loss could amount to $9 billion — less than one-fourth of the Countrywide losses.
“It is the worst deal in the history of American finance,” Tony Plath, a banking and finance professor at the University of North Carolina at Charlotte told the WSJ. “Hands down.”