Fourth-quarter mortgage banking income at Wells Fargo & Co. totaled $1.7 billion, up 10% from the $1.5 billion recorded in the
It was an increase of $71 million from the third quarter and that change was driven by higher servicing income.
"Mortgage origination revenue in the fourth quarter benefited from a $128 million repurchase reserve release, as we resolved certain exposures and revised liability assumptions. Higher mortgage origination revenue also reflected stronger multifamily mortgage activity in the fourth quarter," Wells Fargo Chairman and CEO John Stumpf said during the conference call.
For the year, Wells Fargo had mortgage banking income of $6.5 billion, a 2% increase over 2014. The improvement was due to a $1 billion or 33% increase in the gain on originations and sales, which offset an almost $900 million decline in servicing income.
Total loan production at Wells Fargo for the fourth quarter was $47 billion, down from $55 billion in the third quarter, but up from $44 billion in the fourth quarter of 2014. The quarter-to-quarter decline was due to seasonality, Stumpf said. But later during the conference call, he said preparations for the TILA/RESPA integrated disclosures likely contributed to the lower origination volume as well.
During the fourth quarter, the retail channel made up $27 billion of new originations and the correspondent channel contributed $19 billion. This was down from $32 billion and $22 billion, respectively, in the third quarter.
When asked about the impact of TRID, Stumpf said, "It adds a week [to the origination process]. And it turns out to be in many cases a bit of an inconvenience to a customer…but I don't think it really had an impact." But, similar to what JPMorgan Chase said in
For the year, Wells Fargo originated $213 billion, compared with $175 billion in 2014.
The company had quarterly earnings of $5.7 billion, similar to the year before, and annual profits of $23 billion, compared with $23.1 billion for all of 2014.
