Quarterly originations slowed at Regions Financial Corp. as the company continued to pare its mortgage assets. Loan performance improved.
From the beginning of this year through the end of March, mortgage originations totaled $1.819 billion.
During the previous three-month period, Regions Bank generated $2.124 billion in home-loan production.
Business improved from the year-earlier period, when $1.610 billion in residential fundings were generated.
Regions said that nearly half of its new applications in the first quarter were for purchase financing.
“Overall, the company continues to benefit from HARP II loan production, as only 20 percent of all eligible HARP II loans have been refinanced to date,” the report stated. “Approximately 40 percent of all HARP mortgage applications submitted are from outside our existing customer base.”
The earnings report didn’t indicate the size of the mortgage servicing portfolio, but a prior filing with the Securities and Exchange Commission did indicate that the third-party servicing portfolio was $26.2 billion as of Dec. 31, 2012.
Included in Regions’ investment portfolio were $24.421 billion in residential loans. Home-loan assets were trimmed from $24.763 billion at the end of last year and cut from $26.253 billion at the same point last year.
The March 31, 2013, total reflected $12.875 billion in residential first liens, $5.625 billion in first-lien home-equity loans and $5.921 billion in second-lien HELs.
Delinquency of at least 30 days on Regions’ non-guaranteed first liens declined to 3.27 percent from 3.46 percent at the end of the fourth quarter. At the end of the first-quarter 2012, delinquency was 3.72 percent.
On the HEL portfolio, delinquency fell to 1.78 percent from 2.04 percent and was 1.93 percent a year earlier.
Commercial real estate loans owned by the Birmingham, Ala.-based bank totaled $17.459 billion as of March 31, contracting from $18.119 billion at the end of the previous quarter and slashed from $28.424 billion as of March 31, 2012.
Last month’s CRE total reflected $9.812 billion in owner-occupied loans, $0.325 billion in owner-occupied construction loans, $6.338 billion in investor mortgages and $0.984 billion in loans secured by investor construction sites.
On the owner-occupied portion of its CRE loans, the delinquency rate dropped to 0.59 percent from 0.82 percent three months earlier and 0.70 percent 12 months earlier.
Investor CRE delinquency climbed, however, to 1.52 percent from 1.34 percent in the prior quarter and 1.35 percent in the same quarter during the prior year.
Mortgage income fell to $72 million from $90 million in the fourth-quarter 2012 and $77 million in the first-quarter 2012. The quarter-over-quarter drop was primarily the result of production and sales income, which fell to $59 million from $72 million — though a $7 million hedging loss didn’t help matters.
Regions Financial reported $447 million in income before income taxes from continuing operations, a little more than the $415 million it earned in the prior quarter. Income improved from $321 million earned in the first-quarter 2012.
The bank-holding company boasted a business-wide staff of 23,466 people, more than the 23,427 employees as of the end of last year but fewer than the 23,619 headcount in place at the same point last year.
Regions Bank operated 1,709 branch outlets, two fewer than as of Dec. 31, 2012.