While bacteria divide clonally, occasional homologous recombination is known to be an important contributor to their evolution. However, the details of how the competition between clonal inheritance and recombination shapes genome diversification, population structure, and species stability remains poorly understood. Using a computational model, we propose two evolutionary regimes and identify two composite parameters that dictate the fate of bacterial species. In the divergent regime, characterized by either a low recombination frequency or strict barriers to recombination, cohesion due to recombination is not sufficient to overcome the mutational drift. As a consequence, the divergence between any pair of genomes in the population steadily increases in the course of evolution. The species as a whole lacks coherence at the population level with sub-populations continuously formed and dissolved. In contrast, in the metastable regime, characterized by a high recombination frequency combined with low barriers to recombination, genomes continuously recombine with the rest of the population. The population remains genetically cohesive and stable over time. We demonstrate that the transition between these two regimes can be affected by relatively small changes in evolutionary parameters. Using the data from Multi Locus Sequence Typing (MLST) analysis we classify a number of well-studied bacterial species to be either the divergent or the metastable type. Mechanisms that allow bacterial species to transition from one regime to another are discussed. Generalizations of the framework to understand adaptive populations, horizontal gene transfer of non-homologous regions, and spatial correlations in diversity along the chromosome are also discussed.