Bank of America (NYSE: BAC) touted its deal in July 2008 to buy Countrywide as a terrific value, a chance to buy up lots of assets on the cheap. But has buyer's remorse settled in? Clearly, ex-CEO Ken Lewis could not have predicted the kind of liability the mortgage giant packed.

"Since the purchase closed, the bank's home loan division has lost $8.5 billion. Bank of America has reached more than $730 million in Countrywide-related legal and regulatory settlements," notes the bank's hometown Charlotte Observor.

"And the bank has set aside $4.4 billion to cover requests from investors to buy back soured home loans. And that's not likely to be the final tab. A thicket of lawsuits remains, and the bank has acknowledged it expects a long fight against requests to buy back mortgages," notes the Observer. "At the end of the third quarter, the outstanding requests totaled nearly $13 billion."

One expert called the mortgage company a "bottomless pit" for Bank of America. Esteemed financial analyst Mike Mayo even raised the prospect of seeking bankruptcy court protection for Countrywide in a memo to clients. He noted that most of the bank's "mortgage problems stem back to [its] acquisition of Countrywide, which originated 86 percent of [its] mortgage loans that are 60-plus days behind on payments."

CEO Brian Moynihan (Brian Moynihan news) had this handed to him. The deal wasn't his idea. But his tenure will be defined in part by how he handles it.

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