Big bank’s mortgage revenue dwindling

by Justin da Rosa14 Jul 2015
JPMorgan’s second quarter results may have surpassed expectations, but its mortgage revenue waned.

The big bank posted earnings of $1.54 per share on Tuesday, surpassing the estimated $1.45 per share. It also posted revenue of $24.3 billion. Shares, meanwhile, are up one per cent.

Still, not all is entirely well at the country’s largest bank.

Mortgage banking net income fell to $584 million, a 20 per cent drop. And with JPMorgan’s origination’s seeing an increase, it appears that it is losing out on refinance business, with smaller lenders likely offering more enticing products to those looking to cash in on low rates.

“Net revenue was $24.5 billion, down three per cent, driven by lower mortgage banking revenue and lower CIB Markets revenue related to business simplification, partially offset by growth in Asset Management,” the bank’s shareholder document reads.

JPMorgan also shrunk its workforce by axing 6,000 jobs from its retail banking division.

Still, overall, the bank appears to have put the effects of the financial crisis behind it. JPMorgan has been saddled with over $20 billion in fines since the financial crisis and just this month was forced to pay $136 million in fines for illegal practices pertaining to delinquent borrowers.

"The CFPB and states found that Chase sold 'zombie debts' to third-party debt buyers, which include accounts that were inaccurate, settled, discharged in bankruptcy, not owed, or otherwise not collectible," the Consumer Financial Protection Bureau wrote at the time.



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