Although agency mortgage securitization gobbles up a huge share of new home loan originations, jumbo mortgages, home-equity loans and nontraditional mortgage sectors are largely held in retained portfolios that have to be carefully managed, experts say. “Your loan portfolio is incredibly important,” said Jerry Hubbard, president of FTN Financial Capital Assets Corporation during a panel at this week’s Mortgage Bankers Association Secondary Market Conference. “Your consolidated portfolio is three to four times bigger than an investment portfolio. It’s the most important asset on the books...

Dividend payments paid by Freddie Mac to the U.S. Treasury for its continued financial support held down the GSE during the first quarter of 2012 as Freddie would have otherwise posted a profit. Freddie, which posted its first quarter results late this week, actually reported $577 million in net income during the first three months of this year before having to repay $1.8 billion in preferred stock dividends to the government. Under the terms of the GSEs’ purchase agreement, the Treasury is entitled to a dividend of 10 percent per year on a quarterly basis. Freddie’s first quarter dividend payment more than offset the company’s comprehensive income of $1.79 billion, prompting the GSE to seek another $19 million from taxpayers.

The GSE executive exodus continued last week with the announcement that the executive who oversees Freddie Mac’s single-family mortgage business has resigned. Anthony Renzi, Freddie’s executive vice president of single-family business, operations and information technology, will leave the company effective May 11, according to a filing with the Securities and Exchange Commission. Renzi, who came to Freddie after being forced out of GMAC Mortgage in April 2010, will join Citigroup Inc. as its new chief operating officer. The company said Paul Mullings, senior vice president of single-family sourcing and securitization, will take over Renzi’s duties on an interim basis.

The Federal Home Loan Bank Office of Finance announced this week that preliminary combined net income for the FHLBanks jumped 42.3 percent to $733 million in the first quarter of 2012, up from $515 million from the end of the fourth quarter and a whopping 104.7 percent increase from the same period last year. The FHLBank system’s $375 million year-over-year income increase was driven by lower other-than-temporary impairment charges, higher net gains on derivatives, hedged items and financial instruments carried at fair value, and lower assessments, partially offset by lower net interest income, said the Office of Finance.

Even as the still-regenerating Home Affordable Refinance Program is already proving itself to be a boon for banks’ bottom lines, participants of an exclusive Inside Mortgage Finance webinar last week said so far there’s little indication borrowers are disadvantaged because there are currently fewer new lenders originating HARP 2.0 as same servicers. Since January, one month after the revised program took effect, lenders have reported intense interest and a more significant uptick in new refinance applications.

An independent House investigative agency has recommended the ethics case against the current chairman of the House Financial Services Committee be closed. The Office of Congressional Ethics reportedly informed Rep. Spencer Bachus, R-AL, that it found no evidence he violated insider trading rules in his stock trading activities and that it recommended to the House Ethics Committee that the case be dismissed.

Nearly all major lenders have reported increased earnings from their mortgage banking activities during the first quarter of 2012, according to a new Inside Mortgage Trends analysis of earnings reports from 25 companies. As a group, the 25 public companies posted an impressive $7.606 billion in mortgage banking income during the first three months of 2012. That was up 39.0 percent from the $5.471 billion these same firms earned over the final three months of 2011, and it was a huge 177.4 percent increase over the first quarter of last year.The group’s first-quarter mortgage banking...(Includes one data chart)

Mortgage lenders that were less than enthusiastic about the first version of the refinance program for underwater Fannie Mae and Freddie Mac borrowers now see the revised initiative as a significant opportunity for 2012 and beyond. A recent Federal Reserve survey of senior loan officers revealed that 39 percent of large banks have begun actively soliciting Home Affordable Refinance Program business, although participation rates are lower among smaller institutions. Officials from M&T Bank and SunTrust Mortgage said during a recent webinar sponsored by Inside Mortgage Finance Publications that they...

Nearly half of the 56 banks reported that they offer “nontraditional” home mortgages, such as interest-only loans. Virtually all banks say their lending standards for Fannie Mae/Freddie Mac loans, as measured by credit score and loan-to-value ratio, have tightened since 2006. Key factors include difficulty in getting mortgage insurance, repurchase risk and, to a lesser extent, higher servicing costs for delinquent loans. Most banks don’t see new treatment of mortgage servicing rights under Basel III as a major deterrent to staying in the mortgage business. Increasing compliance burden is a bigger...

Bulk warehouse retailer Costco has added another item to its long list of consumer products: mortgages. Following a one-year pilot program, Costco of Issaquah, WA, has partnered with nearly a dozen mortgage lenders across the country to offer purchase and refinance loan products to the store’s U.S.-based members. The affinity marketing arrangement is not just pure marketing of mortgages but also aimed at ensuring that Costco’s members get the full value of their membership through high-quality service and savings, according to Jay Smith, the company’s director of marketing. Costco is no stranger to the...