PrimeLending Jumbo Originations Perform Well

During the two years ended Jan. 31, the Dallas-based firm has originated 800 jumbo mortgages.

Delinquency of at least 60 days on those jumbo loans is non-existent.

In addition, PrimeLending has received no repurchase demands from its jumbo investors, according to Moody’s Investors Service — which rated PrimeLending’s loan performance as “strong.”

An “above-average” rating on PrimeLending’s sales and marketing, underwriting and closing practices; an “average” assessment of credit-risk management; and a “below-average” rating for its property valuation policy and procedures prompted the ratings agency to deliver an “average” assessment of the lender’s originator ability.

Moody’s noted that “PrimeLending needs to develop more robust processes and systems to track appraisal quality.”

Technology was rated “above-average” as were quality control and audit functions.

The 2,300-employee firm’s originator stability was rated as “average.”

A “below-average” assessment of PrimeLending’s financial strength was the result of its being a monoline mortgage company subject to some geographic and business line concentration, Moody’s indicated.

“Nevertheless, PrimeLending’s parent is PlainsCapital Bank which is funded primarily by deposits and has solid capital ratios and well performing assets,” the report stated. “Moody’s regards PrimeLending’s management strength & staff quality and legal & regulatory oversight as ‘average.'”

PlainsCapital Corp. disclosed in May that it had agreed to become a subsidiary of Hilltop Holdings Inc. The stock-cash deal, which is subject to regulatory approval, is expected to close by the end of this year.