It was a deal too good for a bargain-hunting bank to ignore.

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Bank of America on Friday confirmed it would pay $4.1 billion in stock for the nation's biggest mortgage lender, Countrywide Financial Corp., a deal that would make Bank of America the top mortgage servicer and lender in the country.

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Analysts said the deal could prove savvy in the long term, but that in today's volatile credit environment, it was still a very big risk.

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While the buyout rescues the floundering mortgage company, it doesn't provide a way out for the thousands of Countrywide borrowers, including 1,875 in Delaware. It also exposes Bank of America to Countrywide's large portfolio of risky loans.

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The deal would fill the final gap in Bank of America's array of banking services, giving it 25 percent share of the country's mortgage origination market and 17 percent of the mortgage servicing market. Under terms of the agreement, shareholders of Countrywide would receive 0.1822 of a share of Bank of America stock in exchange for each share of Countrywide.

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Bank of America chairman and CEO Kenneth D. Lewis told analysts Friday the merger would be "like MBNA operationally in the sense that we will convert to their system."

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Bank of America employs about 7,500 people in Delaware, down from about 11,700 employed by Wilmington-based MBNA Corp in January 2006, when the two merged. Delaware officials speculated the new deal would have little immediate impact on Delaware because the bank said it plans to keep operations separate, integrating the Countrywide brand no sooner than 2009.

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Given that Bank of America has pledged to operate on separate platforms, there shouldn't be a downside to the transaction for Delaware, said Judy McKinney-Cherry, director of the Delaware Economic Development Office. Countrywide, incorporated in Delaware and based in Calabasas, Calif., has four offices in Delaware and about 50 employees here. The mortgage lender has been struggling financially for months after the nation's housing market went soft and an increasing number of its mortgage loans began to go bad. In August, Bank of America spent $2 billion for a 16 percent stake in Countrywide after the mortgage company was forced to tap into an $11.5 billion line of credit when funding from Wall Street dried up.

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"Bank of America does have an uncanny ability to be able to find diamonds in the rough and make them precious jewels," said McKinney-Cherry. "If the past predicts the future, they'll be able to parlay this into a very valuable situation."

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Analysts and Wall Street reacted to the announcement with caution.

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The transaction "poses significant challenges to Bank of America," Fitch Ratings credit analyst David Spring wrote in a note Friday. Although Countrywide has scaled back on subprime loans in recent months, the company still carries a large volume of risky mortgages. Bank of America, too, has been burned by bad loans in recent quarters. Adding to the financial strain, Bank of America is still working to integrate its $21 billion purchase of Chicago, Ill.-based LaSalle Bank Corp.

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"Strategically consistent, cyclically risky," is how research analyst Mike Mayo of Deutsche Bank put it in his note.

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One of the questions raised by the proposed merger was whether regulators would approve the deal, given a federal law that bans any bank from holding more than 10 percent of the nation's deposits. Bank of America has been pushing up against the 10 percent deposit cap for months, giving the bank little room for a large acquisition.

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Bank of America's chief financial officer said in a conference call Friday that the cap wouldn't apply to Countrywide's deposits because it has its money in a federally chartered thrift, not a bank.

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CreditSights analyst David Hendler said Bank of America's proposal to buy Countrywide also could be used as leverage to change the deposit cap in the long run.

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"Bank of America continues to quietly lobby for a higher cap," Hendler said. "Taking on a big mortgage credit quality situation just gives them more political capital to get that done over time."

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Shares of Countrywide dropped $1.42, or 18.32 percent, to $6.33, while shares of Bank of America fell 80 cents, or 2 percent, to $38.50. Investors felt the $4.1 billion price tag was too hefty.