Countrywide Credit to Buy Balboa Life

Countrywide Credit Industries Inc. said Monday it will buy Balboa Life & Casualty Insurance for $425 million, acquiring a home loan insurance business that complements its position as the biggest U.S. non-bank mortgage lender.

Balboa is an Irvine-based unit of Associates First Capital Corp., which acquired the insurer in January when it bought Avco Financial Services Inc. from Textron Inc. for $3.9 billion. The unit had $234 million of net premiums in 1998, mostly in home loan and auto loan insurance. Its clients include 1,500 financial-service companies.

Countrywide Chairman Angelo Mozilo said buying the unit will let his company cut costs and market services to some of Balboa’s customers. “This acquisition enables us to further penetrate our mortgage customer base,” Mozilo said. In New York Stock Exchange trading, Countrywide shares fell 88 cents to close at $39.31, and Dallas-based Associates First declined 69 cents to close at $39.50.