Loan giant Countrywide saw its shares plummet 13% yesterday after the company experienced trouble borrowing money in the market for short-term debt. A Merrill Lynch analyst downgraded the stock from "buy" to "sell," sparking talk of possible bankruptcy, reports the LA Times. Before today's open, the company announced it's drawing on $11.6 billion in unsecured lines of credit.
The California-based lender, which wrote one of every six US home loans from January to June of this year, blamed "unprecedented disruptions" in the credit markets for its financing woes in a regulatory filing last week, adding, "the potential impact on the company is unknown." Countrywide stock has lost 50% of its value in 2007.