Mortgage production at Flagstar Bancorp Inc. improved on both a quarter-over-quarter and year-over-year basis. A recent acquisition helped fuel the growth.
The Troy, Michigan-based company reported in its third-quarter earnings report that income before the provision for income taxes was $60 million.
Although Flagstar’s earnings weakened from $87 million during the same-three months last year, the bank-holding company reported no quarter-over-quarter change.
Led by higher retail originations, mortgage revenues increased 13 percent, or $9 million, from the prior quarter.
Previously reported second-quarter mortgage revenues were up 16 percent, or $10 million, from the preceding three-month period.
Loan originators at Flagstar closed $9.666 billion in home loans during the three months ended Sept. 30, 2017. The total was made up of $9.572 billion in residential first mortgages and $0.094 billion in home-equity-related assets.
Business — which reflected a full quarter of operations following the acquisition of Opes Advisors earlier this year — improved from the prior quarter’s upwardly revised $9.259 and upwardly revised $9.242 billion a year prior.
Flagstar’s year-over-year improvement contrasts that of most lenders, which so far have reported declines from a year earlier.
Third-quarter 2017 volume consisted of $4.5 billion in conventional mortgages, $2.2 billion in government originations and $2.9 billion in jumbo loans. Refinance share
widened to 42.7 percent from 40.2 percent in the second quarter.
From Jan. 1, 2017, through Sept. 30, overall production came to $24.884 billion.
New business in the current quarter is poised to ease from the
third-quarter pace based on mortgage rate lock commitments, which slipped to $9.9 billion as of Sept. 30 from $10.8 billion on June 30.
Flagstar boasts more than a thousand loan correspondents and nearly 700 mortgage broker relationships.
The primary servicing portfolio concluded September 2017 at
118,350 loans with an aggregate unpaid principal balance of $28.718 billion. The portfolio expanded from 96,981 loans for $23.300 billion as of June 30 but contracted from 167,763 loans for $37.017 billion as of the same date last year.
Included in last month’s total was $21.342 billion in third-party servicing.
The capitalized value of mortgage servicing rights was 1.15 percent as of the most-recent date.
Another $62.351 billion in mortgages were subserviced by Flagstar.
On the bank’s balance sheet were $3.161 billion in residential assets including $2.665 billion in first mortgages and $0.496 billion in home-equity assets. The total expanded from $2.997 billion three months earlier and $2.589 billion one year earlier.
Also included in the investment portfolio were $1.760 billion in commercial real estate loans and $1.159 billion in warehouse lending.
Flagstar’s payroll expanded to 3,495 full-time employees at the end of last month from 3,432
people as of mid-year 2017. Staffing was just 2,881 as of Sept. 30, 2016.
Flagstar said it operated 95 retail home lending offices, including 48 under the Flagstar brand and 47 under the Opes brand.
Bank branches in operation numbered 99,
no different than at the end of the second quarter.
