KBW: Results are in for how 2Q mortgage originations performed

Investing

The results are in for the majority of the top mortgage originators in the industry, creating a clear picture of how the market performed in the second quarter.

An overview of Keefe, Bruyette Woods’ 2Q16 mortgage banking summary shows that banks didn’t necessarily perform badly this past quarter, but they could’ve done better. 

Of the banks that KBW tracks, it stated that total originations increased 32% from the first quarter, but declined by 3% from the same period last year.

KBW said that moving into the third quarter mortgage applications are increasing and are up 21% on average for the companies that have reported.

However, KBW added, “Given the shift in market share from banks to nonbanks, we believe that the increase in volumes for the companies in our coverage universe could be stronger than the industry average.”

Although the 32% increase was below the 45% quarter-over-quarter growth suggested by an averaging of the forecasts by the Mortgage Bankers Association, Fannie Mae and Freddie Mac, KBW said. “It still represents a strong quarter of mortgage originations.”

There are a few companies on KBW’s radar that have yet to report, including PHH, Nationstar Mortgage, Walter Investment Management, PennyMac Financial, Redwood Trust and Stonegate Mortgage.

Those that have reported include: Wells Fargo, JPMorgan, Bank of America, Citi, BBTPNC Financial, SunTrust, U.S. Bancorp and Fifth Third Bancorp.

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