Fed Greenlights Bank of America - Countrywide Merger

The Federal Reserve has given the Bank of America permission to buy subprime lender, Countrywide Financial Corp.

The deal which is expected to be completed later in the year would make the Bank of America the largest mortgage lender in the United States while expanding the company's consumer real estate product offerings.

"This transaction represents a rare opportunity for Bank of America to significantly gain market share in the mortgage business, allowing it to expand in a cornerstone financial product," said Bank of America Chairman and Chief Executive Officer Kenneth D. Lewis.

California based, Countrywide will hold a special shareholder meeting on June 25 to vote on the sale.