A decline in mortgage-related income caused noninterest income at SunTrust Banks Inc., Atlanta to decline by $15 million between the third and fourth quarters.
But when the fourth quarters of 2009 and 2010 are compared, noninterest income increased by $290 million in part because of improvements in income from mortgage operations.
Mortgage production income was down by $92 million between the third and fourth quarters because of lower volume and reduced margins.
SunTrust took an $85 million provision for repurchase losses in the fourth quarter, down $10 million from the third quarter. At the end of 2010, SunTrust's mortgage repurchase reserves totaled $265 million.
Between the fourth quarter 2009 and fourth quarter 2010, mortgage production income increased by $109 million because of a $139 million reduction in the provision for repurchase losses.
SunTrust's mortgage servicing income was off by $64 million between the third and fourth quarters because of a reduction in net hedge performance and the negative impact of higher prepayments on the value of mortgage servicing rights.
Higher net hedge performance when comparing the fourth quarter 2009 and 2010 resulted in an increase of $21 million in mortgage servicing income.
SunTrust's MSR portfolio was at $167 billion at the end of 2010, down from $179 billion one year prior.
