Bank of America became the second bank mortgage lender in two days to report significant quarter-over-quarter growth in refinance volume in the fourth quarter.
The Charlotte, N.C.-headquartered bank said its refinance originations grew 12% in the fourth quarter compared to the third quarter. These loans made up 65% of its $11.6 billion in first mortgage production during the fourth quarter. In the third quarter, refis were 57% of the $11.7 billion in originations.
On Wednesday, Wells Fargo also said its fourth quarter refi mortgage volume increased by 14% over the third quarter. Unlike B of A, however, most of Wells Fargo's volume in both periods came from purchase loans.
Because B of A had lower litigation expenses in the fourth quarter, the net loss of $397 million for the mortgage business was actually an improvement over the $5.2 billion loss in the third quarter and $1 billion loss in the fourth quarter 2013. During the quarter, the company settled a $16.7 billion case with the U.S. government.
On the corporate level, B of A had net income of $3.1 billion for the fourth quarter of 2014, compared with $3.4 billion in the year-ago period.
The bank's home equity line of credit lending volume was $3.4 billion for the period, up from $3.2 billion in the third quarter and $1.9 billion for the fourth quarter of 2013.
Origination revenue was approximately $300 million, similar to the third quarter and down from approximately $400 million in the fourth quarter 2013.
The number of loans delinquent 60 days or more fell to 189,000 at the end of the quarter from 325,000 one year prior.
Servicing income was approximately $400 million for the fourth quarter, up from nearly $200 million in the third quarter, but down from $600 million in the fourth quarter 2013.
Separately, Citigroup said in its supplemental earnings data that it originated $6.7 billion in residential mortgages during the fourth quarter, down 18% from its fourth quarter 2013 volume of $8.3 billion and down 6% from the $7.1 billion originated in the third quarter.
Citi did not provide a breakdown of percentage of refinance versus purchase.
Residential mortgage delinquencies declined by $1.53 billion to $3.13 billion as of Dec. 31, from $4.66 billion one year ago.
Citi's combined net servicing revenue and origination gain on sale revenue was $255.6 million, up from the third quarter's $132.4 million and last year's fourth quarter $142.9 million.
Citigroup Inc. on Wednesday reported net income for the fourth quarter of $350 million, down from net income of $2.5 billion for last year's fourth quarter.
