For the first time in six quarters, JPMorgan Chase & Co. failed to surpass its prior-quarter mortgage production. Mortgage earnings and servicing also came up short.
From Oct. 1, 2015, through Dec. 31, Chase originated $22.5 billion in home loans, according to the bank’s fourth-quarter 2015 earnings report.
Home loan production fell $7.4 billion from third-quarter volume.
Prior to the recent period, Chase had not seen a quarter-over-quarter mortgage origination loss since the second-quarter 2014.
As well, recent mortgage originations numbers were a half-billion dollars short of the fourth-quarter 2014 total.
A year earlier, the report accounted for an additional $0.856 billion in home-equity loan production, which Chase no longer reports.
Recent-quarter lending volume included correspondent acquisitions at $13.8 billion — far from the $20.4 billion reported in the prior three months. Retail originations added another $8.7 billion to fourth-quarter 2015 production but also fell short of the third quarter, when $9.5 billion was funded.
For all of 2015, the lender originated loans totaling $106.4 billion. Annual activity climbed from $81.102 billion in 2014.
When December ended, Chase’s mortgage servicing portfolio had thinned to $910.1 billion from $929.0 billion as of Sept. 30 and $948.8 billion at the end of the fourth-quarter a year earlier.
The recent total included $674.0 billion in home loans serviced for third parties.
At the end of December, Chase had $223.234 billion in owned, total-period-end residential loans. These assets increased from $214.579 billion reported as of Sept. 30 and $183.569 billion claimed as of Dec. 31, 2014.
Loans on the balance sheet reflected $157.107 billion in prime mortgages, which included adjustable-rate mortgage options. HELs totaling $58.734 billion, subprime mortgages at $6.995 billion and $0.398 billion in loans labeled as “other” made up the rest of Chase’s fourth-quarter 2015 residential investments.
Excluding purchased credit-impaired loans, the 30-day or more delinquency rate for the company’s mortgage investment portfolio was 1.57 percent — much better than 1.74 percent as of Sept. 30 and 2.61 percent as of Dec. 31, 2014.
On PCI loans, the 30-day delinquency rate improved to 11.21 percent from 11.29 percent at the end of the third quarter and 13.33 percent at the end of 2014.
Before income tax expense, the New York City-based company’s mortgage banking income dipped to $0.461 billion from $0.971 earned in the prior quarter. As well, recent mortgage banking earnings were down from $0.566 billion accounted for in the final three-month period of 2014.
At the holding-company level, income before income tax expense rose to $7.4 billion from $6.7 billion in the third quarter. Chase’s recent earnings also were higher than the $6.5 billion brought in during the fourth-quarter 2014.
Company-wide, the number of Chase employees fell to 234,598 at the end of December from 235,678 as of Sept. 30. Headcount was 6,761 lower than at the end of 2014.
The bank reported 5,413 branches or 58 fewer than reported as of Sept. 30, 2015.
