JPMorgan Chase saw its mortgage banking related income spike by almost 200% in the second quarter to $364 million but is forecasting delinquency related losses of at least $1.8 billion for the next few quarters.
In an earnings conference call Thursday morning company chairman and CEO Jamie Dimon cautioned about continued uncertainty in the residential space, adding that he thinks home prices will fall "a little more" but also said that "we don't think anyone knows where home prices are going to be."
Company officials also cited loan repurchases from the GSEs as a continuing worry, noting that buybacks will be a drag on mortgage-related earnings.
In 2Q JPM charged off $1.3 billion of residential loans, 40% less than in the same period a year ago.
In regard to nonperforming loans it controls, prime mortgages accounted for the most of any category ($4.59 billion compared to $3.4 billion a year ago), followed by subprime ($3.1 billion compared to $2.7 billion a year ago), and home equity loans ($1.2 billion compared to $1.5 billion a year ago).
The company had total mortgage revenue of $2.05 billion in 2Q compared to $1.9 billion in 2Q09. As a company, all of JPM earned $4.8 billion, a 77% jump from the same period last year.
