An upcoming acquisition of mortgage servicing rights will strengthen JPMorgan Chase & Co.’s position as a trillion-dollar servicer and potentially position it to ascend to the No 2 spot.
The New York-based bank-holding company reported a third-party residential loan servicing portfolio of $815 billion as of Sept. 30.
In addition, Chase said it owned $181 in mortgages outright.
A news release issued Friday indicated that JPMorgan Chase Bank, N.A., will acquire servicing rights on around 350,000 loans for $70 billion from MetLife Bank, N.A.
The terms weren’t disclosed for the deal, which is subject to regulatory approvals and customary closing conditions.
Chase Head of Mortgage Servicing Eric Schuppenhauer said in the statement that the portfolio is high quality, and many of the borrowers are expected to refinance through Chase.
Chase, currently the No. 3 mortgage servicer, will further reduce Bank of America Corp.’s second-place lead with the MetLife acquisition. BofA’s total servicing was $1.48 trillion as of Sept. 30, but it has been consistently reducing its total servicing portfolio — which stood at $1.92 trillion a year earlier.
MetLife Bank President Jim Rose noted in the announcement that its life insurer parent decided to abandon the bank-holding structure last year.
The sale of the servicing portfolio follows the sale of MetLife Bank deposits to GE Capital, the sale of MetLife Bank’s warehouse lending business to EverBank and the sale of $9.6 billion in reverse mortgage servicing rights to Nationstar Mortgage LLC.
The disclosure that MetLife Home Loans would close down came in January.
As of June 30, MetLife Bank, N.A., serviced $76.7 billion, down from $95.6 billion as of the end of last year. The sale of servicing rights on $70 billion in loans should just about clear out MetLife’s remaining portfolio.