The Corporate Library Reaffirms Early Warning on Countrywide Financial Corporation

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The Corporate Library recently released its latest commentary on Countrywide Financial Corporation (CFC), reaffirming the 'Very High Concern' governance risk rating for the troubled mortgage lender that was first applied in August 2005.

The Corporate Library has released its latest commentary on Countrywide Financial Corporation (CFC), reaffirming the 'Very High Concern' governance risk rating for the troubled mortgage lender that was first applied in August 2005. Although the stock price has recovered somewhat following a bullish speech on Tuesday, September 18, by CEO Angelo Mozilo, nothing in the underlying governance risk has changed to alter this assessment, according to the leading independent governance research firm. While the company may have been one of the darlings of Wall Street, reporting record profits for several years, The Corporate Library's senior analysts have long reported that the company exhibits significant governance risk.

While a number of issues have led to the company's 'Very High Concern' status, the principal cause of concern remains the company's executive compensation policies. The report's authors, Chief Analyst Ric Marshall and Senior Research Associate Paul Hodgson, comment: "The fundamental truth is this: any board which can make such poor decisions about a CEO's compensation package is almost certain to be making poor decisions elsewhere in its range of responsibilities. We saw this in 2000 and 2001 at Global Crossing, another high flyer cast down to Earth, and at any number of seemingly strong companies since. CEO pay that is poorly aligned with sustainable shareholder value is not just the idealist's soap box; it is a powerful early warning sign of significant governance weakness."

The commentary is available for download on The Corporate Library's website at http://www.thecorporatelibrary.com.

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MELANIE BOND
The Corporate Library
207-553-5667
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Drew Buckley

207-553-5666
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