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Chase’s Mortgage Servicing Down, Assets Up

Mortgage News

While there was little change in quarterly mortgage originations at JPMorgan Chase & Co., the residential servicing portfolio declined as mortgage assets grew.

Income before income tax expense at the bank-holding company came to $9.7 billion in the three months ended June 30, surging from $8.3 billion the prior quarter.

Those details, along with other operational and financial results, were presented by the New York-based organization in its second-quarter 2017 earnings report.

Income also ascended from the year-prior period, when the total was $9.3 billion.

Mortgage fees and related income were $401 million in the latest period, hardly changed from $406 million in the first-quarter 2017 but plunging from $689 million in the second-quarter 2016. Second-quarter 2017 mortgage fees consisted of $152 million in net production revenue and $249 million in net mortgage servicing revenue.

From April 1, 2017, through June 30, Chase originated $26.2 billion in single-family loans across all entities. Production edged up from $25.6 billion in the previous three-month period but slipped from $28.6 billion in the same three-month period last year.

First-half 2017 originations came to $51.8 billion.

Retail lending accounted for $9.7 billion of second-quarter 2017 volume from just the consumer and community banking division, while correspondent acquisitions made up $14.2 billion.

The financial institution reported a total mortgage servicing portfolio of $827.8 billion as of mid-2017. The portfolio was trimmed from $836.3 billion at the close of the first quarter and reduced from $880.3 billion at the middle of last year.

Third-party servicing made up $568.0 billion of the latest total. The ratio of mortgage-servicing rights carrying value to third-party mortgage loans serviced fell to 1.02 percent from 1.05 percent as of the end of the first quarter.

Residential assets on Chase’s balance sheet expanded to $235.991 billion from $233.348 billion three months earlier and $233.239 billion one year earlier. The mid-2016 total was made up of $189.661 billion in mortgages and $46.330 billion in home-equity loans.

Excluding government mortgages and purchase credit-impaired loans, 30-day mortgage delinquency was 1.02 percent as of last month, improving 6 basis points from the end of the first quarter of this year and plunging 31 BPS from the same point last year.

Delinquency on PCI loans declined to 9.06 percent as of June 30, 2017, from 9.11 percent at the close of the preceding
period and 10.09 percent at the midpoint of 2016.

Staffing in community banking increased to 135,453 from 133,590 as of March 31, 2017, and 131,815 as of June 30, 2016.

Company-wide headcount concluded last month at 249,257 people. Staffing expanded from 246,345 at the end of March 2017 and 240,046 at the end of June 2016.

Branch count ended June 2017 at 5,217, falling from 5,246 at the end of March.

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