As has been the case among its peers, mortgage production declined at HomeStreet Inc. But new business could improve based on a rise in rate locks. Also increasing was mortgage staffing.
HomeStreet said in its first-quarter earnings report that home loan originations totaled $0.676 billion in the three months ended March 31.
Business slid from the previous period, when $0.773 billion was closed. In the first-quarter 2013, the total was $1.192 billion.
“For the first time in the company’s history, in the quarter, HomeStreet became the number one originator by volume of purchase mortgages in the Pacific Northwest (Washington, Oregon and Idaho) and in the Puget Sound region, based on the combined results of HomeStreet originations and loans originated through an affiliated business arrangement known as WMS Series LLC,” the report said.
Mortgage production is poised to improve during the second quarter based on rate lock commitments, which climbed 21 percent to $803 million.
The Seattle-based company serviced $12.198 billion in single-family loans for third parties as of the end of March. The servicing portfolio grew from $11.796 billion at the end of last year and $9.701 billion at the same point last year.
Residential assets were cut to $0.803 billion from $1.041 billion as of Dec. 31, 2013. As of the same date last year, residential holdings were $0.863 billion.
The March 31, 2014, total included $0.668 billion in single-family loans and $0.135 billion in home-equity loans.
“We took the opportunity to restructure our loans held for investment portfolio and in March decided to sell approximately $300 million of single family mortgages at an attractive price,” HomeStreet Chief Executive Officer Mark K. Mason said in the report. “This action enables us to meet our loan portfolio diversification goals and provides the company additional lending liquidity to support our loan portfolio growth targets.”
Commercial Real Estate
Multifamily originations fell to $0.011 billion from $0.016 billion three months earlier and $0.049 billion a year earlier.
The portfolio of multifamily loans serviced for others inched up to $0.721 billion from $0.720 billion but was down from $0.737 billion as of the same date last year.
Commercial real estate loans on the books finished March at $0.714 billion, retreating from $0.687 billion at the end of the prior quarter. CRE assets have grown from just $0.453 billion as of the end of the first-quarter 2013.
The most recent CRE figure consisted of $0.480 billion in commercial mortgages, $0.071 billion in multifamily loans and $0.163 billion in construction-and-development loans.
The mortgage business cut its losses to $1 million from just over $1 million in the fourth quarter and swung from a $14 million profit a year earlier.
Despite mortgage losses, net income before taxes at the bank-holding company swung to a $3 million profit from a $1 million fourth-quarter loss. Income paled in comparison to the $16 million earned in the year-earlier period.
Within its mortgage banking segment, HomeStreet had 903 employees, 22 fewer than at the end of the prior period but up from 779 people in the year-earlier period.
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Company-wide, HomeStreet closed out the first quarter with a staff of 1,491 employees, down from 1,502 at the end of the fourth quarter. Headcount was 1,218 as of March 31, 2013.
