Bank of America and Wells Fargo Hunt the Elusive Mortgage Loan
By Amanda Alix | April 24, 2013
It's no longer any secret that the biggest banks are being forced to acknowledge that the mortgage-lending mini-boom that gave Wells Fargo (NYSE: WFC ) and JPMorgan Chase (NYSE: JPM ) such lifts in revenue last year is fading fast. Though neither bank turned in lousy first-quarter earnings reports, JPMorgan CEO Jamie Dimon noted that loan growth was stagnating throughout the industry. Wells reported a dip in refinancing, which had helped stoke profits last year, of 65% of new mortgages, from 76% in the year-ago period.
B of A and Wells fight back. Even as Bank of America continues to slim itself down via Project New BAC, it is looking for ways to buck the shrinking mortgage business trend, hoping to keep increasing its production over 50% year over year. That's a tall order, but the bank is using its new retail branch structure to help make that goal a reality.
That's not all. Wells plans additional boosts to its mortgage facilities in Tempe, Arizona, and has hired more than 5,000 new employees in the first quarter of this year. Apparently, Wells expects to grow revenues by pushing new loans, and picking up the slack that JPMorgan's mortgage department staff cuts will engender.
Can Bank of America and Wells Fargo beat the mortgage-slump prediction by engaging in a mortgage-banking blitz? Time will tell, but they surely deserve credit for trying.
Fannie is political piggy bank... Quite hey have insolvent Poole in 06 warned of this GSE problem... The have effectively stole the pensions and SS of many notations.. The bail outs were 300k and even at the highs average house reached 260K... That is a pretty big issue in this whole welfare warfare sickness.