Lenders and their warehouse providers have been openly worrying about thinning profit margins for several quarters now with liquidity a primary concern.
A huge chunk of the fall-off in Fannie/Freddie MBS holdings occurred at Wells Fargo, which reduced its investment in these securities by $7.31 billion.
The vast majority of commercial banks and savings institutions that have mortgage banking operations post positive results from those activities, but overall profitability fell significantly in the third quarter of 2018. A new Inside Mortgage Trends analysis of call-report data reveals the banking industry earned $4.025 billion from mortgage banking during the three-month period ending in September. That was down 14.5 percent from the second quarter, when ... [Includes one data chart]