Countrywide

Running head: COUNTRYWIDE FINANCIAL CORP. CASE STUDY

Countrywide Financial Corp. Case Study

Wanda S. Chism

Bethel University (0559)

Facilitator – Ms. Tiffany McCutcheon

Countrywide Financial Corp. Case Study

Countrywide Financial was founded in 1969 by Angelo Mozilo and David Loeb. Countrywide goal was to become the largest real estate mortgage originator in the United States. Countrywide had met its goal by 2006, with more than 2.2 million loans totaling $408 billion Bethel University (2011). Strategic Planning. Boston:McGaw-Hill. Countrywide’s total operation, from its computer system, to its incentive pay system was set up to achieve the highest earnings out of the mortgage lending firms regardless of what the cost was to its primary stakeholders. Even though Countrywide’s strategic plan put them as the number one Mortgage Loan Originator in the United States, it resulted in them becoming the nation largest business failures in recent decades.

Countrywide’s ethical and operational issues did not effectively evaluate the risk associated with its business practices and failed to see the unethical business behavior therefore causing unpleasant conditions for all stakeholders involved. The major problem for Countrywide was this spectacular change in strategy. The subprime mortgage market collapse as a whole contributed to the fall of Countrywide also. In 2008, Bank of America announced acquisition of Countywide Financial Corporation. Bank of American made many attempts to salvage its acquisition of Countrywide Financial Corp. They were unsuccessful, therefore they retired Countrywide name in 2009. The failure of Countrywide Financial Corp. caused Bank of America to really focus on a strategic plan that encouraged homeownership but only in the best interest of the borrower.

Countrywide Financial Corp. Case Study

The following analysis shows Countrywide Financial Corp. Strengths, Weaknesses, Opportunities and Threats. The SWOT...