Wells Touts Record Profits Despite MSR Charge

Wells Fargo & Co., the nation's second-largest mortgage servicer, has reported record net income of $1.91 billion ($1.12 per share) for the second quarter, despite a significant revenue decline at Wells Fargo Home Mortgage related to the impairment of mortgage servicing rights.The profits were up 11% from $1.71 billion ($1.00 per share) a year earlier. Mortgage originations in the community banking segment totaled $85 billion in the second quarter, an increase of $20 billion from the level recorded in the first quarter, but down from $96 billion a year earlier, the company said. But Home Mortgage revenue declined $559 million, or 42%, from that of a year earlier due partly to a $304 million MSR impairment charge, Wells Fargo reported. The company's mortgage servicing portfolio totaled $874 billion of home loans as of June 30, up 17% from that of a year earlier. The MSR asset was valued at $8.5 billion, or $1.12% of loans serviced for others, compared with $8.5 billion and 1.37% as of June 30, 2004, according to Wells Fargo. The San Francisco-based company can be found online at http://www.wellsfargo.com.