Countrywide May Lose Access to Corporate Debt Markets

Countrywide Financial reported today that its access to capital necessary to fund loans and ongoing operations may become incapacitated if its current debt obligations are cut to junk status.  According to Market Watch: "Our ability to place custodial deposit accounts on deposit with our bank subsidiary could be affected if our credit ratings were reduced below investment grade," Countrywide said in a Form 10-Q filed Friday. Not being able to place custodial deposits at the banking unit would disrupt Countrywide's ability to originate and service home loans because lenders must establish these accounts to hold the borrower's mortgage payments. As of Sept. 30, up to $5.5 billion of Countrywide's custodial deposit accounts on deposit with the bank could be affected if the credit rati