The first quarter of 2020 marked the lowest bank earnings on mortgage banking activity since the financial crisis. A big part of the decline came from steep losses at Fifth Third and Bank of America. (Includes data chart.)
After a planned merger between Amherst Residential and Front Yard Residential fell through, the head of Altisource Portfolio Solutions expressed his displeasure with Front Yard’s board.
For a while there, during the early days of the pandemic, Impac Mortgage appeared to be on the ropes, but it’s back in the lending arena, sans its non-QM menu.
PennyMac Financial, which hedges its MSR portfolio, reported record earnings on mortgage banking in the first quarter. Its largest competitors posted huge losses. (Includes data chart.)
Having hit a rocky patch during the pandemic, Impac Mortgage will be late in reporting first-quarter results and it’s selling most of its MSRs. What’s next?
Despite substantial declines in mortgage banking profitability at Wells Fargo and JPMorgan Chase, the banking industry saw a modest gain in earnings during the first quarter. (Includes data chart.)
Nonbanks with large servicing portfolios are generating high margins from originations. The production is focused on agency mortgages, as nonbanks have largely stopped originating non-agency loans.
Lenders continued to increase loan originator compensation in the first quarter of 2020. However, this party won’t last long as the industry braces for recession, job losses and tighter underwriting.
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