The Early Days
On March 14, 1969, the umbrella organization, Countrywide Credit Industries, was founded. The mortgage lending subsidiary that would one day become Countrywide Home Loans, now a division of Countrywide Bank, FSB, was then called Countrywide Funding Corporation.

Six months later, Countrywide went public, trading over the counter at less than $1 per share. The initial public offering did not raise much capital, but undaunted, Mozilo and Loeb pressed on. Leaving New York, they opened a small office in Los Angeles where the housing market was booming.

Like most mortgage bankers at the time, Countrywide offered FHA and VA loans only. Lack of capital was a constant problem, and after five years in business Countrywide could no longer afford to play by the old rules of mortgage banking.

Creating New Rules
Over lunch one day, Loeb discussed a new plan with Mozilo. Countrywide would have offices without salespeople. Customers would see an ad and walk into an office where they would receive service like at a bank. The founders referred to this new office as the "company store," and opened the first retail office using this model in 1974 in Whittier, California.

The success of that one company store gave birth to five more Countrywide locations. With advertising to drive business, loan production and the number of offices grew steadily through the 1970s.

Expansion Begins in 1979
The bleak economy of the late 1970s and early 1980s presented many challenges. Interest rates were high, and California had particularly heavy interest rate regulations, making business even more challenging.

Countrywide compensated for the lack of business in California by opening offices in eight other states. By 1980, there were 40 such locations and the vision for a "country wide" mortgage company was moving closer to becoming a reality.

Expansion was also possible because Mozilo led the company into conventional loans, which could be sold to investors such as Fannie Mae and Freddie Mac.

Seeking refuge from interest-rate volatility, Countrywide also began to diversify. In 1981, the company formed Countrywide Securities Corporation, a broker-dealer subsidiary that would sell securities backed by loans made.

From 1979 through 1985, Countrywide's expansion also included hiring a group of young entrepreneurs who would become the future leaders of the organizations, including some of today's managing directorate: Dave Sambol, Marshall Gates and Carlos Garcia.

Early Entry into Technology
By the late 1970s, Countrywide was investigating ways to increase efficiency in the loan process. Searching for a way to reduce paperwork through technology, the company developed the industry's first PC-based loan servicing system. Within a year, the data in 12,000 loan files was computerized and available in real time to computer users throughout the company, precipitously reducing the cost to service a loan.

1985: A Year to Remember
A public company since its inception, on October 7, 1985 Countrywide's ticker symbol, CCR, was launched on the New York Stock Exchange. The closing price on day one was $2 per share. A year later Countrywide was trading at $12, and by 1987, Countrywide ranked 37th on Fortune Magazine's Top 100 Stocks of the Year.

Countrywide was also recognized in 1985 by Forbes Magazine, being listed as one of the 200 Best Small Companies.

During the same year, the company moved its headquarters to Pasadena, California, having outgrown its small offices on Wilshire Boulevard in downtown Los Angeles.

Dramatic Growth in Mortgage Business
The latter half of the 1980s saw Countrywide's loan production soar. In 1986, loan production exceeded the $1 billion mark for the first time. The following year, the company hit the $3.1 billion mark, nearly tripling its volume over 12 months.

Loan servicing volumes were also booming. Countrywide reached the $1 billion milestone in loan servicing in 1984. Five years later, the servicing portfolio stood at $11.9 billion.

Diversification within the Mortgage Industry
A major factor in the growth in loan production and servicing was diversification.

In 1984, Countrywide began to slowly build a separate wholesale loan origination department. Through cautious but determined efforts, the new production division grew and by 1993, Countrywide's Wholesale Lending Division, now a division of Countrywide Bank, FSB, was the number one wholesale lender in America with more than 40 percent of total loan production originated from this division.

In the mid-1980s, with interest rates volatile, the nation's savings banks and thrifts did not want to be locked into fixed-rate mortgages. Though government agencies would buy large volumes of loans, Countrywide, seeing an exceptional opportunity, offered to buy fixed-rate loans one at a time.

This was the launch of what would soon be named the Correspondent Lending Division, now a division of Countrywide Bank, FSB. Production volume from these efforts equaled the retail loan operation's production within two years.

Diversification also fueled servicing volume growth. In 1987, Countrywide began to buy servicing rights from other lenders. By 1989, the company's expertise in this area was solidified and the subsidiary, Countrywide Servicing Exchange, was formed to broker these deals for other companies. Within three years, this subsidiary was leading the nation in trading servicing packages.

An Early Leader in Technology
In 1984, Countrywide was the first mortgage lender to use computers to originate home loans, reducing the time it took to create loan forms from a half hour to a few minutes.

The company also installed a mid-range IBM system to service loans. By the late 1980s, with production booming and servicing growing rapidly, the system was near capacity.

A scalable, flexible mid-range system, AS400 became the foundation of Countrywide computer systems, and enabled the company to rapidly build automated systems that would lower costs, enhance efficiency and make the home loan process increasingly seamless for customers.

• Loan Production: Capitalizing on the opportunities from the savings and loan predicament of the late 1980s and the relationships built with loan brokers and financial institutions, Countrywide loan production exceeded $3 billion in 1990--$1.3 billion in Retail, $1.1 billion in Wholesale and $1 billion in Correspondent Lending divisions.
• Technology: By the 1990s, basic computers in Countrywide offices became much more sophisticated, providing a huge competitive advantage. The company's proprietary EDGE software eliminated the need for pre-printed mortgage forms, making the loan process more seamless and reducing costs. And, a homegrown artificial intelligence system called CLUES was launched to provide automation in loan underwriting.

In this booming market, Countrywide emerged as the No.1 mortgage banker in America.

However, the nation's economy was in recession. In addition to the economic stimulation provided by the low-interest rate environment and subsequent refinance boom, leaders like Countrywide's Angelo Mozilo realized that housing was a major concern.

After meeting with President George H. W. Bush at the White House, Mozilo said, "The Administration must place housing and real estate at the top of the nation's agenda."

Reaching Out to Under-Served Communities
Acting on his beliefs, Mozilo reviewed ways for Countrywide to play a major role in assisting with housing and economic challenges.

Since its inception in 1969, Countrywide had worked to lower the barriers to homeownership, especially among lower-income and minority individuals and families.

In 1992, the company underscored its focus on this important issue, by launching a formal affordable lending program called House America that would reach out and give access to homeownership in minority and low- to moderate-income communities.

Thanks to these efforts, Countrywide soon became a leading lender to minorities and lower-income families across the nation.

The Boom is Over
In 1994, the Federal Reserve raised interest rates to control the threat of inflation. The refinance boom ended abruptly, and the effect on the mortgage industry was dramatic.

In the Countrywide family, even though loan production in the mortgage subsidiary dropped, the loan servicing operation was in place to offset much of the impact. But, the company realized that a new and different long-term strategy should be in place to ensure growth regardless of interest rate cycles. The strategy: a solid diversification plan.

Positioning for Future Growth
In 1995, Countrywide made a major move to reach out directly to consumers. A new Consumer Markets Division was formed, combining the retail branch system with the telemarketing group.

Loan business was viewed from a consumer point of view. The actual process of obtaining a home loan was made more seamless and the advertising campaign "Easy. Really.^®" was launched.

To create stronger bonds with its existing customers, Countrywide created monthly billing statements that included customized messages about other products that might be beneficial to individual customers.

The Countrywide family was now strongly positioned to grow through diversifying its loan products and offering financial services beyond its core mortgage business.

First, the company reviewed its menu of home loan products, and took action to build and expand. A Home Equity Lending business unit was launched in 1996, followed by the formation of a business unit offering loans to borrowers with less-than-perfect credit, the Full Spectrum^® Lending Division, which is now a division of Countrywide Bank, FSB. With a fuller home loan product line that could meet the needs of a wider range of homeowners, homebuyers and business partners involved in residential finance, the company recognized that providing other financial services through its family of companies using a home-centric approach would underscore Countrywide's leadership as a convenient, trusted source for financial needs.

During this same period, Countrywide also recognized that its unsurpassed excellence and reputation in the mortgage industry offered great opportunities for pursuing institutional clients who would benefit from mortgage-related products and services.

By leveraging its expertise, the company pursued its home-centric strategies with consumers and financial institutions by growing and expanding in three major areas: loan closing services, insurance and capital markets.

Loan Closing Services
To ensure a smooth home loan process and capture additional business opportunities, Countrywide grew its loan closing services subsidiary, LandSafe^®, during the mid- to late 1990s. Building on its existing credit reporting product line, LandSafe rapidly added appraisal, inspection, flood certification, title and escrow services to its menu. Originally intended to serve the needs of Countrywide customers and business partners, LandSafe soon began to seek banks, credit unions and other clients in the residential finance industry.

Insurance
Countrywide had operated Countrywide Insurance Services, Inc., a subsidiary and an insurance agency, to facilitate homeowners insurance for its loan customers since its inception. In the latter half of the 1990s, Countrywide Insurance Services, Inc., expanded its insurance product offerings to include homeowners, home protection, condo, life, health, disability and auto insurance. The agency's Web site, insurance.countrywide.com, was redesigned to serve as a one-stop resource for information, guidance, purchase and management of a customer's insurance needs.

To reach out to institutional clients and business partners, Countrywide launched two efforts. In November 1999, Countrywide solidified its presence in the insurance industry by acquiring Balboa Life & Casualty, an insurer offering a wide range of products and services, designed exclusively for financial institutions and their customers. In addition, DirectNet Insurance Agency was formed as an outsourcing solution providing insurance brokerage and comprehensive technical and operational resources to financial institutions.

Capital Markets
Long recognized in the secondary market for its expertise as a mortgage-backed securities powerhouse, Countrywide looked for further ways to leverage its expertise in mortgage-related capital markets activities. In 1996, Countrywide Capital Markets was formed as an umbrella for Countrywide Securities Corporation, the broker-dealer, Countrywide Servicing Exchange, the broker of bulk loan servicing rights and Countrywide Asset Management Corporation, a manager of distressed residential real estate assets. Coordinated oversight of all capital markets subsidiaries now enabled the company to grow its client base for packaging and selling securities to investors.

The Close of a Decade Brings Global Expansion
In the United States, mortgage lending has a long history and from 1970, pioneers like Countrywide transformed the industry, streamlining, standardizing and generally improving processes, technologies and operational efficiencies. But, in other countries mortgage lending had not experienced these advantages. Who better to offer expertise and the benefits of technology to the global mortgage market than Countrywide?

Countrywide formed CW Technology Solutions to develop and serve the global financial services market with core applications for international mortgage processing operations, including loan origination, servicing and arrears systems. These activities are now part of Countrywide International Technology Holdings, Ltd.

Countrywide also identified the need to build secondary markets for mortgages in countries around the globe and find avenues for flowing capital into these markets. The company took its first steps in November 2000, launching a new wholly owned subsidiary, Countrywide Capital Markets International, Ltd. (CCM). CCM serves as the European affiliate of Countrywide Securities Corporation, the company's securities broker-dealer, providing mortgage-related capital markets and investment banking expertise. Combining its home-centric diversification and its entry into global markets as the new millennium neared, Countrywide was positioned at home and abroad for further evolution.

Following detailed and exhaustive strategic planning, Countrywide Credit Industries began to position itself to take its rightful place among the world's elite financial services providers. The company's senior leaders also recognized the advantages of organizational training and development programs. The managing directorate grew from 11 to 35 seasoned experts, and an Executive Committee was formed to guide and advise decision-makers.

Core Mortgage Business Thrives
With interest rates at historic lows from 2001 through 2005, Countrywide leveraged its human and technological capital to differentiate itself from competitors in mortgage banking. Record-breaking mortgage loan production volumes made headlines as the company capitalized on the strength of the nation's housing market.

Based on data for 2005, in January 2006, Countrywide was ranked America's No.1 home loan lender by Inside Mortgage Finance, (January 27, 2006, © 2006). Countrywide achieved this leadership position not just because it is an organization with superior capabilities and strategies, but also because Countrywide created a culture in which there is an overriding belief that the company is doing something positive for people -- making a difference in their lives and working together to help homebuyers achieve their dreams.

Diversification
In May 2001, Countrywide acquired Treasury Bank, N.A., headquartered in Alexandria, Virginia. The addition of banking enabled the company to capitalize on synergies with Countrywide's other subsidiaries.

The banking business unit, now operating as Countrywide Bank, FSB, offers consumers highly competitive rates on certificates of deposit, money market and individual retirement accounts. Personal loans and lines of credit are also available. After only six years in operation, in 2007 Countrywide Bank had grown to become the nation's 3rd largest federal savings bank.

With the addition of banking to its other offerings, through its family of companies, Countrywide truly became a diversified financial services provider. The stage was set to announce that the company's goal is to derive 50 percent of pre-tax earnings from its diversified businesses: banking, insurance, capital markets and global businesses.

A New Name Underscores the Strategic Mission
On November 13th, 2002, the company inaugurated its new corporate name, Countrywide Financial Corporation, and unveiled a new stock ticker (NYSE: CFC). The new corporate name provides a more complete picture of Countrywide today and where its vision is leading the company. (Windows Media Player link)

The new name more closely aligns with the company's business definition:

Countrywide is a diversified financial services company serving consumers and institutions, with mortgage origination and servicing at its core.

Countrywide's culture of continuous improvement, individual accountability and respect for diversity in the workplace and the marketplace ensures its success as a financial services powerhouse.

Board Appoints New President
In September 2006, David Sambol assumed the role of President and Chief Operating Officer of Countrywide Financial Corporation. Sambol joined Countrywide in 1985. In addition to his position as President and Chief Operating Officer of Countrywide Home Loans, he directs Countrywide's customer-centric, revenue generating operations and corporate administration activities, including domestic and international mortgage lending and servicing activities, as well as the Banking and Insurance, Capital Markets and Global Operations business segments.

Countrywide's Evolution Continues
In January 2008, consummating the strategy the company had been building toward since acquiring Treasury Bank, Countrywide integrated its mortgage loan production divisions and certain other mortgage banking operations into Countrywide Bank, FSB. This integration represents a key component of Countrywides residential lending strategy and strategic growth plan over the next few years.

With real estate lending representing the core of Countrywides strategic vision, the migration of Countrywides residential lending functions into Countrywide Bank strengthen the companys mission to help people achieve and sustain the dream of homeownership.

Countrywide remains an American success story. From humble beginnings in 1969, today Countrywide is America's #1 home loan lender*. Countrywide remains the #1 lender to minorities, including being the #1 lender to African Americans, Hispanics and Asians, as well as the #1 lender in low- to moderate-income communities.

During a history that spans nearly four decades, Countrywide has helped 20 million families and individuals achieve and sustain their dreams of owning a home. Though the challenging business environment that began in 2007 has affected the mortgage industry, Countrywides focus on its core business, home financing, is unwavering.

*as ranked for 2006 by Inside Mortgage Finance (February 2, 2007), Copyright 2007