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BofA: Expect large home-price declines

Real estate roundup
Published on Jul 10, 2008

BofA sees additional 15% drop in real estate prices Bank of America expects home prices will fall an additional 15 percent nationwide and 20 percent in California, Chief Executive Officer Ken Lewis said in an interview with the Los Angeles Times. Lewis, who has been under fire for Bank of America's decision to acquire troubled mortgage lender Countrywide Financial Corp., said that loan losses at Countrywide are on the high end of Bank of America's projections in January, when the deal was announced. But the all-stock deal -- valued at $2.5 billion when it closed July 1 -- will be profitable from the get-go, Lewis claimed, with huge potential for growth when housing markets recover. Although Bank of America had initially considered using Countrywide's widely recognized brand name, it will phase it out early next year, Lewis said. Bank of America has previously said it plans to lay off 7,500 employees as part of the merger, and engage in workouts or loan modifications wi...

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