Who benefits by keeping Countrywide out of bankruptcy?
The U.S. government for one. Countrywide was losing money and the FDIC could have been forced to pay out big bucks to cover shareholders with insured deposits. Uninsured depositors also are huge winners; they could have lost millions. That category includes Florida cities and counties that invested money with the state Board of Administration. The board’s Local Government Investment Pool holds $650-million in Countrywide CDs, with another $110-million in other state SBA-managed portfolios. Countrywide’s shareholders will get 0.1822 of a share of Bank of America stock for each Countrywide share they own. That’s worth about $7, a far cry from last year’s high of $45 a share, but more than shareholders would have gotten in bankruptcy. Countrywide CEO Angelo Mozilo is expected to walk away with a package worth more than $60-million. Helen Huntley can be reached at hhuntley@sptimes.com or (727) 893-8230.
