When the federal government talked Bank of America to take over Countrywide Mortgage they really hamstrung the North Carolina bank. After suffering multi billion dollar losses over the past couple of years and overwhelming the infrastructure with short sales and foreclosures Bank of America is taking action.

Executive Terry Laughlin has stated that half of the banks mortgages are bad. Yep, not underperforming or needing repair or any of the other bankers terms they use to show the pain they are talking about.

Nope, Laughlin used real English.

The loans are bad.

Yikes.

To fix the problem it looks like Bank of America may be cutting the loans adrift. They are creating a “bad” bank and putting the loans in that one. Maybe they will call the new “bad” bank Countrywide Financial to complete the irony.

“We are creating a classic good bank, bad bank structure,” Laughlin told investors at a meeting in New York Tuesday, according to Bloomberg. He was promoted last month to manage the costs of resolving disputes stemming from the company’s 2008 purchase of Countrywide Financial Corp. “We’re going to get after this, we’re going to do it the right way and we’re going to put it to bed in the next 36 months,” he said. via the Washington Business Journal

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