Bank Profitability

Browse articles from all of our Newsletters related to Bank Profitability.

April 18, 2014 - Inside Mortgage Trends

Big Banks Report Huge Decline in Mortgage Banking Income in 1Q14

Mortgage-banking income at nine major banks declined by 27.7 percent in the first quarter of 2014 compared with the previous quarter, according to an analysis by Inside Mortgage Trends. The declines were driven by a lack of refinance volume, changes in valuations on mortgage servicing rights and litigation costs. “Despite a relatively favorable interest-rate environment, the market got off to a slow start in 2014,” said Marianne Lake, CFO at JPMorgan Chase, during the bank’s ...

April 11, 2014 - Inside Nonconforming Markets

Concerns About Nonbank Servicers’ Growth Persist

Undisclosed third parties rejected a small portion of Ocwen Financial’s planned acquisition of mortgage servicing rights from OneWest Bank, according to a report this week from Fitch Ratings. The lack of approval on Ocwen’s MSR purchase was just the latest hurdle faced by nonbank servicers with plans to grow. Last year, Ocwen announced it planned to acquire a significant portion of MSRs from IndyMac Mortgage Services, a division of OneWest. Fitch said the acquisition ...

April 11, 2014 - Inside Nonconforming Markets

Majority of Banks Willing to Offer Non-QMs

Demand from borrowers for loans that aren’t “qualified mortgages” has prompted many banks to continue to offer non-QMs such as interest-only mortgages or non-agency mortgages with debt-to-income ratios above 43 percent. “We’ve pretty much made the decision that the risk of there being any kind of a kickback from an individual – if we underwrite that thing and document ourselves and do the things we need to do – is a risk worth taking,” said Derek Williams ...

April 3, 2014 - Inside Mortgage Finance

Nonbank Servicers Rank Just as Well as Banks, Put Greater Emphasis on Loan Modifications

The nonbank servicers under scrutiny from regulators have rankings at similar levels to banks, according to an analysis by Inside Mortgage Finance. And while there have been concerns about loss mitigation activity by nonbank servicers, they use loan modifications more than banks. Nationstar Mortgage, Ocwen Financial and Walter Investment Management’s Green Tree Servicing were among the 17 servicers that received a rating of at least three stars from Fannie Mae for their performance in 2013, the government-sponsored enterprise disclosed last week. Twelve unnamed servicers received ratings below three stars. Green Tree (four stars) and Nationstar (three) maintained...

March 28, 2014 - Inside Nonconforming Markets

Banks Complete Non-Agency Servicing Obligations

The monitor of the $25 billion national servicing settlement certified last week that the five participating banks completed their loss-mitigation obligations a year earlier than the three-year deadline set by the settlement. Regulators involved in the settlement continue to defend allowing the banks to complete a portion of their obligations by modifying mortgages in non-agency mortgage-backed securities. Bank of America, Citi, JPMorgan Chase, Residential Capital and Wells Fargo ...

March 28, 2014 - Inside Nonconforming Markets

Banks Bolstering Portfolios with New Originations

Some banks and thrifts have been able to originate enough new mortgages to replace runoff from their portfolios, but the industry’s retained holdings of first-lien mortgages continued to decline in the fourth quarter of 2013, according to a new ranking and analysis by Inside Nonconforming Markets. Banks and thrifts held a total of $1.74 trillion in first-lien mortgages as of the end of 2013, down only 3.0 percent compared with the end of 2012 ... [Includes one data chart]

March 21, 2014 - Inside Mortgage Trends

Servicing Values Rose Sharply in 4Q13, But Banks Continued Shedding MSRs

Commercial banks and savings institutions increasingly saw more value in their mortgage servicing rights as 2013 came to a close, but they showed little interest in trying to get more. Banks and thrifts serviced $4.641 trillion of mortgage loans for other investors as of the end of 2013, according to an Inside Mortgage Trends analysis of call-report data. That was down 13.2 percent from the end of 2012, including a 2.7 percent drop in the fourth quarter ... [Includes one data chart]


What do you think is the biggest hurdle to meeting the new QM standards in the CFPB’s ability-to-repay rule?

A debt-to-income (DTI) cap of 43%.


A 3% cap on points and fees.


An interest rate cap of the average prime offered rate (APOR) plus 1.5%.


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