HomeStreet Inc., Seattle, earned $19 million in the first quarter, because of the strong performance of its growing mortgage banking unit.
In the fourth quarter, the company earned $7 million, while in the first quarter of 2011 it lost $7 million.
HomeStreet produced $712 million of mortgages to be sold on the secondary market, up 14% over the fourth quarter and 159% over the first quarter 2011.
Furthermore, it reported $920 million of mortgage interest rate lock commitments in the period, up 70% over the linked quarter and 263% on a year-over-year basis.
Net gain on originations and sales activities was $29 million, almost 53% above the fourth quarter and 485% over 1Q11.
Its production activity was helped during the quarter by the hiring of almost 170 former MetLife Home Loans employees, ranging from loan officers down to processors, funders, underwriters and other support people. The company said the newly added employees were responsible for $207 million of the rate lock commitments. Of those commitments, $59 million closed in the first quarter.
Mortgage servicing added $8 million of income to HomeStreet's profits during the quarter, up 32% when compared with the fourth quarter and 35% over the first quarter 2011. The increase over the fourth quarter was the result of $2 million in net valuation gains on mortgage servicing rights; in the fourth quarter, it took a loss of $189,000 on MSR valuation.
HomeStreet now services $7.77 billion of mortgages, up $770 million from the end of last year.
