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U.S Bank Grows Mortgage Servicing Portfolio

Quarterly lending might have slipped at U.S. Bancorp, but the financial institution did manage to increase the size of its third-party mortgage servicing portfolio.

From Oct. 1 through Dec. 31, residential loan originations came to $14.485 billion, the Minneapolis-based firm disclosed in its earnings report.

Loans originated for sale represented $10.448 billion of the total, residential portfolio originations were $2.339 billion and home-equity portfolio originations were $1.698 billion.

Total production slipped from the third quarter, when $14.739 billion was funded.

But business was better than the fourth-quarter 2013, when U.S. Bank closed $12.658 billion.

The latest quarter brought full-year 2014 originations to $50.068 billion, far less than the $84.898 billion in 2013 production.

Loan applications inched up to $13.6 billion in the fourth quarter from
$13.5 billion three months earlier, pointing to sustained first-quarter activity.

U.S. Bank said it serviced $225.007 billion in mortgages for third parties. The servicing portfolio grew from $224.632 billion at the end of the third quarter but was slightly off the $226.842 billion portfolio as of the end of the fourth-quarter 2013.

Last year ended with $51.619 billion in residential loans in the investment portfolio, just off the $51.957 billion as of Sept. 30 but more than the $51.156 billion owned as of Dec. 31, 2013. The most-recent figure reflected $38.598 billion in mortgages and $13.021 billion in first-lien home-equity loans.

Delinquency of at least 30 days on this portion of the investment portfolio crept up to 2.50 percent as of the fourth quarter from 2.49 percent in the prior three-month period but was improved from 2.86 percent in the year-earlier period.

U.S. Bank additionally owned $15.916 billion in home-equity and second mortgages. That segment of the balance sheet has grown from $15.769 billion as of the end of the third quarter and $15.442 billion as of the end of 2013.

Home-equity delinquency climbed 5 basis points to 1.87 percent. Still, the past-due rate stood 19 BPS below the fourth-quarter 2013.

Commercial real estate loans owned rose to $42.795 billion from $40.909 billion three months prior and $39.885 billion a year prior.
Last month’s total reflected $33.360 billion in commercial mortgages and $9.435 billion in construction-and-development loans.

The CRE 30-day rate jumped to 0.92 percent from the third quarter’s 0.74 percent but remained well below the 1.07 percent rate at the end of 2013.

The bank-holding company earned $2.0 billion before taxes, the same as in the previous period but modestly higher than $1.9 billion in the fourth-quarter 2013.

The year closed out with
3.176 branches, one less than at the end of the third quarter.

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