Independent servicers have driven down their human resource expense — but not enough to offset quarter-over-quarter deterioration on mortgage servicing rights.
The average servicing portfolio at independent mortgage servicers, financial institution subsidiaries and subsidiaries of non-depository institutions was 77,671 loans for $12.884 billion as of the first quarter.
Average residential loan servicing portfolios retreated from three months earlier, when they stood at 78,973 loans for $13.067 billion.
But portfolios have increased, however, from 54,673 units for $8.762 billion as of March 31, 2013.
The Mortgage Bankers Association reported the data in its Quarterly Mortgage Bankers Performance Report Q1 2014.
While 232 servicers submitted data for the most recent report, numbers from just 189 companies that participated in the current and prior survey were used for the two most recent quarters. Year-earlier numbers, however, reflect data from all survey participants.
The average loans serviced per full-time servicing employee rose to 1,297 from 1,106 and was also up from 1,023 one year prior.
The increased efficiency helped drive down personnel costs to 6.2 BPS from 6.6 BPS in the fourth-quarter 2013 and 7.4 BPS in the first-quarter 2013.
Servicers earned an average of $227 per loan in net servicing financial income, less than the $350 earned in the fourth quarter of last year but better than $181 earned in the first quarter of last year.
That worked out to 12.3 BPS, tumbling from 19.2 BPS in the prior period but better than 10.5 BPS in the year-earlier period.
Behind the quarter-over-quarter decline in income was deterioration in net gains on “bulk sale of servicing” and “MSR valuations & hedging.”
For companies that serviced fewer than 2,500 loans, net financial income was 10.5 BPS, while it climbed to 15.2 BPS for firms with portfolios of between 2,500 and 10,000 loans in their servicing portfolios. However, income fell to 9.2 BPS for servicers with more than 50,000 loans in their portfolios.
