Production recovers from steep fourth-quarter drop
Just months after reporting that mortgage production had been cut in half, Bank of America was seeing volume climb again.
At the start of 2004, the Charlotte-based lender disclosed that fourth-quarter 2003 originations had plunged to $18.4 billion, down 53% from the third quarter’s $39.5 billion as the refinance wave broke. Retail production fell even faster than wholesale, leaving the bank with a much thinner pipeline heading into the new year.
By mid-April, fresh figures showed that first-quarter activity had bounced from those lows, prompting Mortgage Daily to flag the turnaround in production even though overall volume remained below the 2003 refi peak.
From refis to a more balanced mix
The rebound came as Bank of America shifted from a market dominated by rate-driven refinancing to one where purchase loans and plain-vanilla products carried more of the load. Industry data showed 2004 originations running well below 2003’s record levels, but still high by historical standards, with big retail lenders like BoA holding meaningful share.
The bank was also digesting its FleetBoston Financial acquisition, completed on 1 April 2004, which expanded its presence in New England and added to its mortgage and home-equity franchise.
What the bounce means for the market
For MortgageDaily readers, the early-2004 uptick at Bank of America underscored three trends:
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Large lenders can rebound quickly once rates stabilise and purchase demand firms.
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Capacity built for the refi boom is often repositioned rather than abandoned, especially in core prime and home-equity lines.
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Scale players increasingly rely on diversified distribution – branch, retail and selected wholesale – instead of leaning too heavily on any one channel.
Volumes may have been down from the historic highs of 2003, but Bank of America’s bounce showed that, for major players, the mortgage business in 2004 was far from finished – it was simply entering a new phase.
