What seemed like a great idea earlier this summer has cost Bank of America Corp. nearly $1 billion.

Since the Charlotte-based banking giant invested $2 billion in struggling Countrywide Financial Corp., the biggest U.S. mortgage lender, the investment has shed nearly half its value, on paper, since the deal was announced in August.

Shares in Countrywide have been in a free-fall, losing 14 percent Monday and, at one point, nearly 20 percent today, amid speculation the Calabasas-based lender may file for bankruptcy.

Bank of America purchased preferred-stock to help bail out the lender amid the global credit crunch and reserves the right to convert the preferred stock to common shares at $18 each.

Countrywide shares were trading in the mid-$20 range when the deal was announced.

Today, shares closed down 2.8 percent to $10.28, meaning the deal has cost Bank of America nearly $900 million, on paper.