Hilltop Holding’s Home Lending Falling

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Home lending volume turned lower in the final quarter of last year at Hilltop Holdings Inc., and a more sharp decline is likely ahead. Overall earnings increased, but mortgage income fell.

In its fourth-quarter 2017 earnings report,
the Dallas-based bank-holding company revealed that it earned $65 million before income taxes during the three months ended Dec. 31, 2017.

Income improved from $53 million during the same three months of 2016. Earnings also increased form the third-quarter 2017, when the total was $48 million.

As a result of the Tax Cuts and Jobs Act, Hilltop took a $28 million charge for the revaluation of deferred tax assets due to the reduction in the corporate tax rate.

Income from mortgage originations was $8 million, sinking from $13 million in the third quarter.

Residential loan originations during the final-three months of last year was 15,168 loans closed for $3.603 billion, falling from 16,904 units funded for $3.973 billion in the third quarter and 16,440 loans for $3.888 billion in the fourth-quarter 2016.

For all 12 months of 2017, mortgage production amounted to 62,058 loans for $14.458 billion, off from 66,881 loans in 2016 for $15.460 billion.

Last year’s refinance share was 17.2 percent, thinning from 27.1 percent the previous year.

Loans to finance Texas properties accounted for 22 percent of 2017’s production, while California had a 13 percent share. All other states had a share of less than 6 percent.

First-quarter 2018 originations have likely plummeted based on interest rate lock commitments, which sank to $0.9 billion as of year-end 2017 from $1.3 at the end of the third quarter.

The third-party servicing portfolio was $4.762 billion at the end of last year,
growing from $4.175 billion at the end of the third quarter but down from $5.481 billion at the end of 2016.

Mortgage servicing rights as a percentage of the servicing portfolio most recently was 1.15 percent.

PrimeLending’s headcount concluded 2017 at approximately 3,000 employees.

Company-wide headcount was 5,500 people, the same as three months earlier and
up from 5,400 a year earlier.

Mortgages were originated through 330 locations.


Mortgage Daily Staff


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