Quarterly and annual mortgage originations tumbled at Wells Fargo & Co. The country’s biggest lender trimmed its mortgage staffing, reduced its servicing portfolio and fell short on mortgage earnings.
Fourth-quarter mortgage production was $50 billion, according to earnings data reported Tuesday.
Business slid from three months earlier, when the San Francisco-based firm generated $80 billion in home loan closings.
Originations plummeted from the fourth-quarter 2012, when volume totaled $125 billion.
During the 12 months ended Dec. 31, 2013, Wells Fargo funded $351 billion, declining from the $524 billion originated in all of 2012.
The current quarter is on track for a further decline based on new applications, which fell to $65 billion in the latest period from $87 billion in the third quarter. The pipeline of new business was cut to $25 billion from $35 billion during the previous period.
Refinance share fell below a third from 41 percent in the third quarter.
Retail originations accounted for $26 billion of fourth-quarter production, while the correspondent-wholesale channel was responsible for $23 billion.
The managed mortgage servicing portfolio finished last year at $1.829 trillion. The portfolio was down from Sept. 30, when Wells Fargo serviced $1.844 trillion, and Dec. 31, 2012, when the portfolio stood at $1.873 trillion.
Last month’s total included $1.485 trillion in loans serviced for others, $0.338 trillion in owned loans serviced and $0.006 trillion in sub-servicing.
First mortgages on the balance sheet grew to $258.497 billion from $254.924 billion as of Sept. 30, 2013, and $249.900 billion as of Dec. 31, 2012.
Another $65.914 billion in junior liens were owned. This category was down from $67.675 billion at the end of September and $75.465 billion at the end of the previous year.
Wells Fargo serviced $533 billion in commercial mortgages, the same as at the end of the previous quarter and up from $527 billion at the end of the previous year.
The Dec. 31, 2013, commercial servicing portfolio included $419 billion in loans serviced for others, $107 billion in owned loans serviced and $7 billion in sub-servicing.
Commercial real estate loans on the balance sheet increased to $107.100 billion from $105.540 billion and were even up from $106.340 billion at the same point in 2012.
Another $16.747 billion in CRE construction loans were in the investment portfolio, more than $16.413 billion at the end of September but less than $16.904 billion at the end of December 2012.
Repurchase liability was slashed to $0.899 billion from $2.206 billion at the end of 2012. Unresolved repurchases ended last year at 3,328 loans for $0.708 billion.
Wells said that its mortgage banking income was $1.570 billion, off from $1.608 billion in the prior three-month period and down from $3.068 billion in the year-earlier period.
Income before taxes at the holding company level fell to $8.217 billion from $8.301 billion and was $7.221 billion in the same period last year.
Earnings after taxes were a record $5.610 billion, a little more than $5.578 billion in the prior period.
Mortgage staffing was reduced by 1,100 employees during the fourth quarter.
Across all businesses, Wells Fargo employed 264,900 people. Staffing was reduced from 270,600 three months earlier and 269,200 a year earlier.
