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CNBC Exclusive: Maria Bartiromo Speaks with Countrywide Financial Chairman and CEO Angelo Mozilo on "The Call" Today (Transcript Included)

LET'S GET TO MARIA BARTIROMO, STANDING BY EXCLUSIVELY WITH ONE OF THE KEY ATTENDEES OF TODAY'S HOUSING FORUM, ANGELO MOZILO, THE CHAIRMAN OF THE COUNTRYWIDE.

MARIA BARTIROMO: I'M HERE ANGELO MOZILO, NICE TO HAVE YOU WITH US. THANK YOU FOR JOINING US. YOU HAVEN'T BEEN OUT HERE PUBLICLY IN SOME TIME, WE APPRECIATE YOU SITTING DOWN WITH US RIGHT NOW. FIRST QUESTION ABOUT HANK PAULSON'S PLAN WITH REGARD TO FREEZING CERTAIN MORTGAGE RATES, THE HOPE PLAN, DO YOU BUY INTO IT? ARE YOU GOING TO PARTICIPATE? WHAT ARE YOUR THOUGHTS?

ANGELO MOZILO: I DO BUY INTO IT. I THINK IT'S A GOOD PLAN. HANK PAULSON AND I HAVE BEEN TALKING ABOUT IT FOR SOME TIME. WE BUY INTO IT AND A MAJOR PART OF IT AND WE HAVE BEEN WE CALLED IT OUR HOME WEEK RETENTION INITIATIVE. WE'VE DONE 5,000 LOANS IN TERMS OF SAVING THEM FROM RESET. EXPECT TO DO ANOTHER 40,000 TO 50,000 NEXT YEAR DEPENDING ON WHERE RATES GO, SO WE THINK IT'S A GOOD PROGRAM.

MARIA BARTIROMO: ISN'T THE DEVIL IN THE DETAILS? IT'S GOING TO BE HARD TO CATEGORIZE WHICH BORROWERS YOU ACTUALLY ARE HELPING AND GET THEIR RATES FROZEN. HOW DO YOU CATEGORIZE THAT?

ANGELO MOZILO: WE HAVE 3,000 EMPLOYEES JUST DEDICATED TO THIS, LOAN BY LOAN. ANALYZING WHETHER OR NOT THEY CAN AFFORD THE RESET OR NOT. IF THEY CAN'T AFFORD THE RESET THEN IT WON'T BE RESET. IF THEY CAN'T AFFORD ANALYZE WHETHER OR NOT THEY CAN AFFORD THE EXISTING LOAN THAT THEY HAVE, THE EXISTING INTEREST RATE THEY HAVE AND THEN FREEZING IT FOR A PERIOD OF TIME UNTIL THEY GET ON THEIR FEET. THEN YOU HAVE LOANS THAT JUST CANNOT BE SALVAGED WHERE THEY'RE PAYING INTEREST RATES BELOW THE COST OF FUNDS. SOME OF THESE PAY OPTION LOANS, WE ONLY DID PRIME LOANS BUT IT'S BLEEDING INTO PRIME NOW. THE DEVIL IS IN THE DETAILS. IT'S A DIFFICULT PROCESS, BUT I THINK ONE THAT WILL BE CONSTRUCTIVE AND PRODUCTIVE AT THE END OF THE DAY.

MARIA BARTIROMO:WE'RE GOING TO TALK TO HANK PAULSON ON CLOSING BELL LATER ON. ONE OF THE BIGGEST GO QUESTIONS IS DOESN'T THIS ENCOURAGE SOMEONE WHO WOULD NORMALLY BE ABLE TO PAY FOR THEIR MORTGAGE SAY I'M GOING TO MISS A COUPLE OF PAYMENTS PURPOSELY BECAUSE I CAN GET MY RATE FROZEN.

ANGELO MOZILO: THERE ARE ALWAYS PEOPLE WHO WILL GAIN THE SYSTEM, THAT'S HOW WE GOT INTO THE PROBLEM WE'RE INTODAY.BUT AGAIN, WE'RE ANALYZING EACH LOAN IN TERMS OF INCOME, RESERVE, PAYMENT HISTORY.AND IF A FEW TRY TO GET BY THE SYSTEM, THEY PROBABLY WILL, BUT WE'LL DO IT ON AN INDIVIDUAL LOAN BASIS, I THINK WE CAN DETECT SOMEONE WHO IS TRY TO PLAY A GAME WITH US VERSUS ONES WHO LEGITIMATELY NEED HELP.

MARIA BARTIROMO: LET'S TURN TO COUNTRYWIDE, SPECIFICLY. YOUR COMPANY SPECIFICALLY IN THE EYE OF THE STORM HERE IN THIS HOUSING SLOWDOWN. CHARACTERIZE WHERE WE ARE RIGHT NOW? HOW WOULD YOU CHARACTERIZE THE ENVIRONMENT? HAS ANYTHING IMPROVED FOR YOU?

ANGELO MOZILO: A LOT OF THINGS HAVE IMPROVED FOR COUNTRYWIDE IN TERMS OF LIQUIDITY AND CAPITAL. AS WE ANNOUNCED IN THE THIRD QUARTER, WE HAVE ADEQUATE LIQUIDITY AND CAPITAL. THAT HAS IMPROVED. WE'VE ALSO DOWNSIZED SO WE'VE CONTINUED TO CUT EXPENSES. AND TO CONFORM WITH WHERE THE MARKET IS GOING. WHERE IT IS BOTTOMING OUT IS VERY HARD TO TELL. WE'RE ESTIMATING THAT NEXT YEAR WE HAVE ABOUT A 1.5 TO 1.8 TRILLION MARKET. THAT'S A DRAMATIC REDUCTION FROM A 4.8 TO 4 TRILLION A FEW YEARS AGO. SO WE'RE ADJUSTING THE COMPANY TO THE NEW POSITION YEAR IN.

MARIA BARTIROMO: THE MARKET SEEMS TO BELIEVE YOUR WI, THE SYMPTOM HAS DROPPED 75% THIS YEAR, HOW WOULD YOU CHARACTER CHARACTERIZE IT IF WE SEE LOSS IN AREAS CONTINUE TO WORSEN?

ANGELO MOZILO: FIRST OF YOU WILL, THE STOCK PRICE OF MOST FINANCIAL COMPANIES THOSE HAD WHO WHO HAVE SURVIVED HAVE DROPPED COUNT SUBSTANTIALLY. SO COUNTRYWIDE IS NOT ALONE IN THAT REGARD. IN FACT, THE FACT THAT WE'VE COME THROUGH IT AS HEALTHY AS WE HAVE COME THROUGH IT IS A TESTIMONY TO THE STRENGTH OF THE COMPANY, THE STRENGTH OF MANAGEMENT. FINANCIAL CAPACITY OF THE COMPANY. SO I WOULDN'T ATTRIBUTE THE STOCK PRICE TO WHERE THE COMPANY IS AT, STOCKS, AS YOU KNOW, A LOT OF EMOTIONAL ISSUES IN STOCK PRICE. AS TO THE FUTURE AS TO WHERE THE COMPANY IS GOING, WE'RE GOING TO CONTINUE TO DO WHAT WE'RE DOING AND ADJUST AND WE BELIEVE THAT AT THE END OF THE DAY, THIS COULD BE SERIOUS CONSOLIDATION, THERE ALREADY IS AND MOST OF OUR COMPETITORS ARE GONE AND WILL BE A BENEFICIARY OF THAT OVERTIME.

MARIA BARTIROMO: A LOT OF PEOPLE SAY YOU'VE BEEN PLEDGING A RETURN TO PROFITABILITY ALL THE WAY DOWN, YOU'VE WRITTEN DOWN REPORTED LOAN LOSSES OF $1 BILLION IN THE THIRD QUARTER ALONE, SOME PEOPLE SAY YOU HAVEN'T GONE FAR ENOUGH. ARE WE GOING TO SEE FURTHER WRITEDOWNS?

ANGELO MOZILO: WE MADE ALL OF OUR ANNOUNCEMENTS IN THE THIRD QUARTER, I THINK, WE SAID IN THE FOURTH QUARTER, WE WOULD BE PROFITABLE. YOU GOT TO REMEMBER THAT WE HAD 35 YEARS OF PROFITABILITY. THE FIRST TIME, THE FIRST QUARTER WE LOST WAS LAST QUARTER. SO TO SAY THAT THE COMPANY HAS CONTINUED TO LOSE MONEY IS JUST NOT AN ACCURATE APPRAISAL OF OUR PERFORMANCE WE PERFORMED EXTREMELY WELL AND WE HAD A WRITEDOWN IN THE THIRD QUARTER SAYING THAT WE BELIEVE WE RETURN TO PROFITABILITY IN THE FOURTH QUARTER.

MARIA BARTIROMO: IS YOUR DIVIDEND IN JEOPARDY?

ANGELO MOZILO: I CAN'T COMMENT ON THAT. I WOULD STAY WITH WHAT WE SAID IN THE THIRD QUARTER.

MARIA BARTIROMO: ANGELO, A THE LOT OF PEOPLE WANT TO KNOW ABOUT THE SEC INVESTIGATION AND YOU SELLING YOUR STOCK. LAST TIME WE SPOKE, YOU TOLD US THAT YOU SOLD $130 MILLION OF YOUR OWN STOCK IN THE FIRST HALF OF THE YEAR BUT THIS WAS ALL PREARANGED AND PART OF YOUR COMPENSATION AND A PLAN THAT WAS -- YOU DIDN'T HAVE THE SPECIFICS ON. PEOPLE WANT TO KNOW, DID YOU DO ANYTHING WRONG?

ANGELO MOZILO: ABSOLUTELY NOT. I THINK IN THE LAST -- IT WAS EITHER THE LAST QUARTER OR PREVIOUS QUARTER, I BELIEVE I FILED BY 10 B-5 IN EXACT ACCORDANCE WITH THE REGULATION OF THE SEC AND I BELIEVE THAT TO BE TRUE THEN WHEN I DID IT AND I BELIEVE THAT TO BE TRUE. IT'S IMPORTANT TO NOTE, SINCE I STARTED THIS COMPANY 39 YEARS AGO, I TOOK STOCK OPTION. THE STOCK IS UP 25,000% DURING THAT PERIOD OF TIME. ALL OF THE SHAREHOLDERS HAVE BENEFITED WITH ME. AND IT'S BECAUSE THE COMPANY HASBEEN SUCCESSFUL AND STOCK HAS BEEN SUCCESSFUL, FAR MORE SUCCESSFUL THAN BERKSHIRE HATHAWAY OR MICROSOFT AND THEY HAVE BEEN PAID $50 BILLION OR $60 BILLION EACH I THINK AND WE HAVE BEEN AROUND AS LONG AS THEY HAVE BEEN. I WAS A BENEFICIARY OF THE FACT THAT THE COMPANY DID WELL.

MARIA BARTIROMO: AND SHAREHOLDERS AS WELL. ANGELO, WE'RE IN A LIVE SHOW, WE'LL SEND IT BACK TO THE STUDIO. I WANT TO TALK ABOUT THE BANK OF AMERICA INVESTMENT. AT 18 OBVIOUSLY THE STOCK IS WAY DOWN FROM THEN. WE'RE GOING TO TALK ABOUT THAT ON "THE CLOSING BELL." SO WE'LL CONTINUE OUR CONVERSATION ON TAPE. IN THE MEANTIME, I'LL SEND IT BACK TO YOU, DYLAN, AT THE EXCHANGE.

ANGELO MOZILO: THANK YOU, WELCOME HOME.




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