Commercial banks and their holding companies reported a small increase in mortgage banking income during the fourth quarter of 2011, but the industry earned far less for the year than it had in 2010. An Inside Mortgage Trends analysis of bank call report data shows that the industry reported $5.58 billion in mortgage banking income during the fourth quarter, up 2.0 percent from the previous three-month period. For the full year, banks posted a combined $5.21 billion in mortgage banking income – an amount that was actually less than the totals in both the third and fourth quarter. In the...(Includes one data chart)

The 12 Federal Home Loan Banks would see an expanded and enhanced role in a post-Fannie/Freddie mortgage market as envisioned by the National Association of Home Builders. The NAHB last week issued its blueprint for housing finance reform that would transition Fannie Mae and Freddie Mac to a new mortgage securitization system for single-family and multifamily conventional mortgages.

The outlook for the private mortgage insurers remains grim as MI companies continued reporting significant operating losses in 2011 and, unless positive factors come into play by mid-2012, time may soon run out for the sector, according to a Standard & Poor’s analysis. As the U.S. economy struggles in recovery, little hope remains for mortgage insurers to begin reporting operating profits by the end of this year, said S&P senior credit analyst Ron Joas. Sluggish employment growth and the depressed housing market have resulted in more delinquencies that pose further...(Includes one data chart)

Discover Financial Services is a few months away from having a residential mortgage component to augment its direct-to-consumer banking business model, thanks to its pending acquisition of LendingTree, a wholly-owned subsidiary of Tree.com Inc., for approximately $55.9 million. LendingTree, otherwise known as Home Loan Center, originates and processes residential mortgages in all 50 states and the District of Columbia, with the intent to sell them in the secondary market. Loans held for sale consist primarily of residential first mortgage loans that are secured by residential real...

The Federal Housing Finance Agency Office of Inspector General took the FHFA to task this week for what the OIG considers the agency’s lax supervision of Freddie Mac’s relationship with its servicers. Specifically, the FHFA has not clearly defined its role regarding servicers, sufficiently coordinated with other federal banking agencies about risks and supervisory concerns with individual servicers, or timely addressed emerging risks presented by mortgage servicing contractors.

The massive shakeout in the warehouse financing industry that began in 2007 has left the door wide open for community banks and mid-sized regional financial institutions to enter and become essential providers of warehouse lending. Among the recent new entrants is EverBank Financial Corp., of Jacksonville, which last month signed an agreement to acquire MetLife’s warehouse finance business, boosting its potential to be one of the major players in the resurging sector. Terms and conditions of the acquisition agreement remain undisclosed and the deal is expected to be completed by the first half of 2012...

The mortgage servicer American Home Mortgage Servicing Inc. recently announced a name change to Homeward Residential, reflecting its entrance into the correspondent and warehouse lending market in October 2011. AHMS ranked 18th on a list of top mortgage servicers in 2011 compiled by affiliated publication Inside Mortgage Finance. The company serviced $69.02 billion in residential mortgages at the end of 2011, down 9.7 percent from the year before, with most of its business in non-agency mortgages. The company plans to complete its rebranding as Homeward Residential by the second quarter of 2012. The business...

The Obama administration has released its February Housing Scorecard, and news regarding the housing overhang is largely positive. Existing home sales have continued their upward climb, reaching the highest they’ve been since May 2010. According to the scorecard, if turnover continued at the current rate, it would take 6.1 months to sell the supply of existing homes on the market, and another 5.6 months for the stock of new homes for sale. Timelines haven’t been that short since 2006. There is always a “but,” however. This month, it’s home prices, which continue to fall despite positive market news. Outstanding...

Bank of America and JPMorgan Chase will once again receive servicer incentives for modifying loans after more than seven months during which these payments were withheld by the Treasury Department for unsatisfactory performance in the Home Affordable Modification Program. The two banks will also get all the withheld incentives as part of the multistate foreclosure settlement. In June 2011, Bank of America, JPMorgan and Wells Fargo were all called to the carpet by the Treasury for their HAMP performance following a 10-month audit of participating servicers. The main issue was timeliness – while mods...