Ally Financial Inc.’s banking unit is looking at alternatives for its remaining servicing portfolio of agency mortgages. The financial institution is also considering scaling by residential originations — though it is still interested in originating non-conforming loans for its own portfolio.
The total mortgage servicing portfolio at the Detroit-based company stood at $338 billion as of March 31. But since the May 14 Chapter 11 bankruptcy of its Residential Capital LLC subsidiary, the servicing portfolio at Ally Bank has fallen to $122 billion as of Sept. 30.
A business lending unit operated by Ally Bank includes correspondent originations, a mortgage broker channel and a warehouse lending unit.
Ally said in July that it would exit its warehouse lending business in a move that is expected to be completed by the end of this year, while it disclosed in November 2011 plans to scale back its correspondent production.
On Friday, Ally Bank announced that it is exploring strategic alternatives for its agency mortgage servicing rights and its business lending operations.
“After careful consideration, the decision was made to explore alternatives for the agency MSR portfolio and the business lending operation as they are no longer strategic activities for the Bank,” Ally Bank President and Chief Executive Officer Barbara Yastine said in the announcement. “We are focused on exploring the best option for these activities going forward.”
Today’s statement indicated that the Midvale, Utah-based bank will continue originating a “modest level of high-quality” jumbo home loans for its own portfolio through correspondents and wholesale brokers.
Earlier this week, ResCap said that Ocwen Loan Servicing LLC and Walter Investment Management Corp. won a bid to acquire ResCap’s mortgage servicing and origination platform assets out of bankruptcy for $3 billion.
