Wells Fargo & Co., which dominates the nation's residential lending market, saw its home fundings tumble by 34% to $84 billion in the first quarter as higher rates took a bite out of refinancings.
Moreover, its application pipeline, at quarter's end, fell by even more: 38% to $45 billion.
Wells' closest competitor in home lending, Bank of America, experienced a 33% drop in loan production during the quarter.
In its earnings supplement, released early Wednesday morning, the bank also revealed that during the quarter its trimmed its mortgage retail fulfillment staff by 4,500 full-time equivalents or FTEs.
Its residential servicing portfolio totaled $1.8 trillion at the end of March, just about flat compared to both yearend and 1Q 2010.
Although Wells' MSRs remained just about unchanged, the bank reported that it marked up the value of its residential servicing asset to $15.64 billion at March 31 — an 8% jump from yearend.
Wells Fargo Home Mortgage said its delinquencies and foreclosures continued to fall and are lower than its peers. At March 31 its home late payments totaled 8.02% compared to 14.3% for Bank of America.
In its earnings conference call company CEO and chairman John G. Stumpf said the megabank supports national servicing standards and has already implemented certain changes to its loan processing procedures, including establishing a single point of contact for troubled home borrowers.
Overall, the entire banked earned $3.8 billion, a 48% spike from 1Q10.
