Seven publicly held nonbanks reported a combined loss of $47.8 million on their mortgage banking operations in the second quarter as interest rate volatility hammered their servicing books.
Who says the stock market isn't receptive to mortgage companies these days? Don't tell that to New Rez and Sachem. Meanwhile, the MSR bulk auction market is springing to life once again.
The decline in interest rates earlier this year increased originations and income for lenders and delayed some M&A activity. The lower rates also provided lenders with time to prepare for the future.
Among publicly traded mortgage shops, Lending Tree CEO Doug Lebda took home the most bacon last year: $42.3 million in total compensation. But what do CEOs at private firms earn? The answer is not simple.
Originations are strong in many markets but hiring by mortgage banking firms is not particularly robust. Meanwhile, some executives wonder privately whether the rate rally is getting long in the tooth.
Falling interest rates are sometimes a bad thing — case in point is Mr. Cooper and negative MSR marks. Also, it’s been somewhat quiet on the M&A front but perhaps a change is in the wind.
Nine of the top 10 bank loan sellers reported reduced secondary market activity in the first quarter. Citigroup was an outlier, more than doubling its fourth-quarter volume.
Quicken stands out among nonbanks rated by Moody's Investors Service. The rating service said Quicken's earnings potential is among the highest in the group.
Low revenues, high expenses and trend lines moving in the wrong direction are causing large bank-owned mortgage companies to underperform compared to independent mortgage banks in the retail space, according to a report by Stratmor Group.
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