My Way Lending

Bloomberg reports that Countrywide’s President Dave Sambol won’t stay after the merger goes through.  Some head has to roll for the disastrous lending practices that have built up at Countrywide over the years.  I guess that’s what you get for “protecting the house.”

Bloomberg on Sambol’s exit at Countrywide:

Countrywide Financial Corp. President David Sambol, who became a target for critics of the mortgage company’s loan practices and executive pay, will leave after Bank of America Corp.’s takeover instead of running the combined home lending operations as originally planned.

Barbara Desoer, Bank of America’s chief technology and operations officer, will lead consumer real estate operations and Sambol is retiring, according to a statement today from the Charlotte, North Carolina-based bank. Desoer, 55, will report to Chief Executive Officer Kenneth Lewis.

Sambol and Countrywide Chief Executive Officer Angelo Mozilo have been under fire since Bank of America agreed in January to buy Countrywide for about $4 billion. Lax lending by their company, the biggest U.S. home lender, has been blamed for contributing to record U.S. foreclosures, and critics including U.S. Senator Charles Schumer had asked Bank of America to reconsider the decision to put Sambol in charge.

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Countrywide shareholders are sure to approve the Bank of America takeover at a special meeting on June 25th.  The real question is whether Bank of America’s due diligence and Countrywide’s deteriorating loan portfoliio will be enough to scare away the would-be suitor.

From Market Watch on Countrywide’s special meeting:

Countrywide Financial said late Wednesday that it will hold a special meeting on June 25 for shareholders to vote on the planned acquisition of the mortgage lender by Bank of America . Stockholders at the close of business on April 28 are allowed to vote. For the deal to proceed, investors with a majority of Countrywide shares have to vote for it, the company added.

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