As its mortgage servicing portfolio fell, Flagstar Bancorp Inc.'s quarterly production rose.
The Troy, Mich.-based lender originated $5.5 billion during the first quarter, climbing from $5.1 billion during the fourth quarter, according to an earnings announcement Thursday. A year earlier, residential fundings totaled $4.3 billion.
"We significantly reduced our credit exposure on our high loan-to-value second mortgage/home equity loan portfolio," the statement said. First quarter subprime loan production was a mere $0.03 billion.
Flagstar's servicing portfolio was $19.1 billion at quarter's end, off $10.1 billion from a year earlier, according to the report. Delinquency of at least 90 days was 0.93 percent.
As of March 31, real estate owned declined to $76.8 million, repurchased assets also declined to $9.2 million and nonperforming soared $17.5 million to $74.6 million, Flagstar said.
The company said it held nearly $50 billion in mortgages for investment with average FICO scores of 721 and an average original loan-to-values of 73 percent.
Reflecting a decrease in loan servicing income, net earnings were $18.9 million during the latest period, the announcement said.