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January 22, 2011

Bank of America takes epic charge on its hot mortgage mess

  • $2.24
    billion
    the amount the bailed-out Bank of America lost in 2010, hurt by charges due to their Countrywide merger
  • $4.1
    billion
    the size of the charge they had to take for investors with claims against their mortgage securities  source

» Why such a big charge? Apparently, someone at Bank of America (or Countrywide) was really bad at doing paperwork, or was trying to push through half-baked mortgages. Because both were named as factors in creating the huge charges which resulted from investors making claims against them. Most of the fees are headed to Fannie Mae and Freddie Mac, by the way. Had this charge (and a separate $2 billion goodwill charge related to the Countrywide merger) not been there, Bank of America would’ve been profitable in the fourth quarter.

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10:53 // 3 years ago