Even though it appears that loan applications and fundings swelled in the first quarter of this year, 2008 was one of the bleakest ones on record with all of the nation's top ranked firms suffering, according to a new annual tally by National Mortgage News (NMN).
NMN found that the top five residential funders Wells Fargo & Co., Chase, Bank of America, Countrywide (pre-BoA), and CitiMortgage suffered large declines in originations. BoA's full-year origination volume suffered the least (down 4%) but only because it had Countrywide under its corporate umbrella in the second half of the year. The purchase closed on July 1.
Wells ranked first among all originators with $234 billion in fundings and a market share of 13.41%, followed by Chase ($187 billion/10.69%), Bank of America ($187 billion/10.41%); Countrywide ($132 billion/7.54%), and CitiMortgage ($115 billion/6.59%). If Countrywide's first half fundings are added to BoA's it would give the latter full year production of $314 billion, far eclipsing Wells. Year-over-year, Wells' originations fell by 14%. Chase, Countrywide and Citigroup had declines of 11%, 68% and 42%, respectively.
Meanwhile, in news reported April 9, Wells Fargo & Co. hit a residential home run in the first quarter with originations soaring by 51% to $100 billion, and mortgage-related commitments topping $175 billion.
Released early Thursday morning, the figures were preliminary and included an earnings estimate of $3 billion, which could prove to be a record for the bank. Final numbers will be released when it discloses earnings on April 22.
Wells' strong residential quarter was aided by historically low interest rates and its 2008 acquisition of Wachovia Corp., a bank with a strong (but somewhat troubled) mortgage operation.
The results also indicate that the San Francisco-based bank is poised to gain a huge amount of market share in the mortgage space as other lenders either fail or sell out to stronger competitors.
In the fourth quarter Wells had a loan production market share of 18.37% and a servicing share of 18.58%, according to National Mortgage News and the Quarterly Data Report. Late last year Wells received a $25 billion capital injection via the government's Troubled Asset Relief Program (TARP) program.