, the nation’s largest mortgage lender, reported net income of $5.7 billion for third quarter of 2014, up from $5.6 billion from the third quarter 2013. The bank’s mortgage profits suffered a decline of 46% during the past quarter and its new origination mortgages fell to its lowest level since the financial crisis.
posted net income of $5.6 billion, up from a net loss of $380 million during the third quarter of 2013. Chase said the loss was due to the $1 billion it spent for legal expenses, which reduced its net earnings by $0.26 per share. The bank announced in July its plan to back out of home loan
s made to less creditworthy borrowers.
announced an adjusted net profit for the quarter of $3.67 billion. This was a 13% increase year-over-year from the $3.26 billion in the third quarter of 2013. Citigroup previously said it is hoping to target more affluent borrowers and outright sell its subprime lending unit, OneMain Financial
Bank of America
beat analyst expectations, reporting net income of $168 million for the third quarter and loan revenue declined $484 million from the third quarter of 2013 to $1.1 billion. The bank has said since 2008 its plans to scale back its mortgage operations. The bank recently announced it will lay off nearly 200 employees in its North Texas mortgage servicing operations center.
The pullback from banks has allowed nonbank lenders to boost their market shares. Specialized mortgage companies made 23% of all mortgage loans in the first six months of the year, up from 17% in the first half of 2013 and 11% in the same period in 2012, according to the Wall Street Journal.
Nonbank lenders are also catering to less-creditworthy borrowers, another void left by banks since the housing bust. Banks remain hesitant about mortgage lending because they had to repurchase billions of dollars of bad mortgages after the crash
The nation’s biggest banks announced their third quarter earnings this week, and while they all have reported revenue increases, their mortgage profits are slagging behind. Banks have been reducing their mortgage production, leaving room for specialized mortgage companies to step in and fill the void.