The Service Employees International Union (SEIU) — the fastest-growing union in North America — today cautioned against uncritical and short-sighted support for Bank of America’s attempt to acquire troubled mortgage giant Countrywide Financial Corporation. In a statement issued today, SEIU said:

“With the deepening housing crisis and growing concerns about the unknown risks lurking on and off Bank of America’s balance sheet, we believe combining the largest bank with the largest mortgage lender will result in unnecessary and unacceptable long-term risk to the nation’s working families and consumers. Permitting such concentration of risk would be like putting a sick patient, Bank of America, together in the same room with a highly contagious and terminally-ill patient, Countrywide, and expecting both of them to get better.

“While investors and regulators are eager to see Countrywide avoid bankruptcy, it is more critical than ever that lawmakers take measures to curb the growth of the nation’s biggest banks. Huge banks and mortgage lenders have long leveraged their market dominance to rake in huge profits regardless of the risks to consumers and the economy and any bailout of Countrywide — the largest culprit in creating the subprime crisis — would be misguided.

“Rather than uncritically cheering Bank of America as a potential savior in the short-term, lawmakers and regulators must look to the potential long-term harm to working families and consumers and the risks to the economy of a Bank of America-Countrywide combination. In addition to being the largest bank in terms of branches and deposits, Bank of America already holds a dominant position in credit cards and other areas and has been growing its own mortgage lending business. Further consolidation of the nation’s banking industry would inevitably result in concentrated economic risks.

“We believe lawmakers must aggressively enforce the 10 percent cap on bank deposits and set standards for the independent and transparent calculation of bank deposits and compliance. Bank of America should not be permitted to use a ‘thrift institution’ loophole to sidestep the spirit — if not the letter — of the 10 percent cap.

“The trade-off for working families and consumers could not be clearer. While a Bank of America bailout of Countrywide could help some mortgage holders today, the long-run harm in terms of reduced competition, higher fees, and even more hidden influence in legislative and regulatory circles is just too high a price to pay for the nation’s working families.”

ABOUT SEIU
With 1.9 million members, the Service Employees International Union (SEIU) is the fastest-growing labor union in North America. Together with consumer advocacy organizations and elected and community leaders around the country, we’re leading efforts to hold the nation’s largest banks accountable to working families and our communities.

Bank of America will invest $2 billion in the form of a non-voting convertible preferred security yielding 7.25 percent annually. The security can be converted into common stock at $18 per share.

“We believe that in the current turmoil the stock market has been underestimating the value in Countrywide’s operations and assets,” said Kenneth D. Lewis, Bank of America chairman and chief executive officer. “This investment reflects our confidence in their business and recognizes the importance of the company in providing home financing across the country. We hope this investment will be a step toward a return to more normal liquidity in the mortgage markets. Countrywide has a strong mortgage origination business and it services the mortgages of one in seven American households.”

Bank of America
Bank of America is one of the world’s largest financial institutions, serving individual consumers, small and middle market businesses and large corporations with a full range of banking, investing, asset management and other financial and risk-management products and services. The company provides unmatched convenience in the United States, serving 57 million consumer and small business relationships with more than 5,700 retail banking offices, more than 17,000 ATMs and award-winning online banking with more than 22 million active users.

Bank of America is the No. 1 overall Small Business Administration (SBA) lender in the United States and the No. 1 SBA lender to minority-owned small businesses. The company serves clients in 175 countries and has relationships with 98 percent of the U.S. Fortune 500 companies and 80 percent of the Fortune Global 500. Bank of America Corporation stock (NYSE:BAC) is listed on the New York Stock Exchange.

“The acquisition of CCMF will strengthen our existing futures Introducing Broker business by expanding our product line and customer base, while diversifying our revenue streams,” said Ron Kripalani, president and chief executive officer of Countrywide Capital Markets, and executive managing director of Countrywide Financial.

“The futures trading industry has grown impressively and continues to demonstrate very attractive prospects for generating fee-based income for our Capital Markets business segment. The addition of CCMF’s capabilities to our existing activities provides economies of scale, as well as synergistic opportunities with our primary dealership in U.S. Treasury and our derivative trading operations,” added Kripalani.

“Countrywide’s reputation and financial strength will provide us the foundation to accelerate our growth and give our clients access to products we could not previously provide,” said Michael Crane, president of CCMF. “I’m very excited about the opportunities this combination brings to our clients and brokers.”

About Countrywide Financial Corporation
Founded in 1969, Countrywide Financial Corporation is a diversified financial services provider and a member of the S&P 500, Forbes 2000 and Fortune 500. Through its family of companies, Countrywide originates, purchases, securitizes, sells, and services prime and nonprime loans; provides loan closing services such as credit reports, appraisals and flood determinations; offers banking services which include depository and home loan products; conducts fixed income securities underwriting and trading activities; provides property, life and casualty insurance; and manages a captive mortgage reinsurance company. For more information about the Company, visit Countrywide’s website at www.countrywide.com. This press release does not constitute an offer of any securities for sale.