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Flagstar Mortgage Originations, Servicing Grow

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Flagstar Bancorp Inc. saw a quarter-over-quarter rise in home lending, and indicators point to continued gains. The mortgage servicing portfolio also increased.

From April 1 through June 30 of this year, the financial institution closed $8.330 billion in residential loans.

Mortgage originations surpassed the $6.352 billion funded during the first quarter.

This information, along with other operational and financial results, was published in the Troy, Michigan-based company’s second-quarter 2016 earnings report.

Home-lending activity finished just shy, however, of the $8.448 billion closed during the second-quarter last year.

The second-quarter 2016 originations total included $4.7 billion in conventional loans, $2.1 billion in government business and $1.5 billion in jumbo production.

Altogether, Flagstar funded $14.682 billion in new home loans during the first-six months of this year.

Refinance share fell to 54 percent from 59 percent in the first quarter.

Fallout-adjusted rate locks surged ahead 18 percent from the first quarter to $8.1 billion. This climb points to continued growth in the third quarter.

Flagstar documented approximately 1,200 third-party originators at the midpoint of 2016.

As of June 30, 2016, Flagstar serviced 163,786 mortgages at $35.822 billion. The mortgage servicing portfolio expanded from 147,846 loans totaling $31.906 billion three months earlier and 152,405 loans at $32.890 billion a year earlier.

The latest total included 29,520 in owned loans at $5.379 billion and 134,266 in mortgages serviced for third parties at $30.443 billion.

Also at the end of June this year, Flagstar reported an additional 194,209 loans were sub-serviced for others at $38.000.

Residential assets thinned to $2.548 billion from $2.905 billion as of March 31 and $3.060 billion as of June 30, 2015.

Total residential holdings as of June 30, 2016, were comprised of $2.075 billion in residential first mortgages, $0.127 billion in second mortgages and $0.346 billion in home-equity lines of credit.

Commercial real estate loans on the balance sheet came to $0.976 billion, an increase over the $0.851 billion balance as of March 31 and the $0.629 billion CRE holdings total as of June 30 last year.

Warehouse lending assets climbed to $1.651 billion from $1.282 billion at the end of the first quarter and $1.203 billion at the end of the second quarter in 2015.

The home-loan provider’s repurchase pipeline was reduced to $11 million from $16 million at the end of March this year.

The company’s earnings before income taxes grew to $69 million from $60 million in the prior three-month financial period. Earnings were down $5 million from the year-earlier period.

Flagstar’s full-time equivalent employee count was bumped up to 2,894 from 2,771 as of March 31 and 2,713 as of June 30, 2015.

As of June 30 this year, the company claimed 29 retail mortgage branches or three more than inventoried at the end of the first quarter.

The financial institution indicated it will soon be pay off its obligations under the Troubled Asset Relief Program.

“As we previously announced, we received regulatory approval to redeem our TARP preferred shares on June 23, 2016,” Flagstar Chief Executive Officer and President Alessandro P. DiNello said in the earnings report. “We will be redeeming these shares in full by the end of July.”

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