SunTrust Banks Inc. cut its home-loan delinquency and grew its mortgage income. The origination of new loans was down 19 percent, and the company increased its reliance on the retail production channel.
Residential fundings during the second quarter were $4.7 billion, falling from $5.8 billion three months earlier, earnings data released Friday indicated. In the second quarter of last year, SunTrust closed $7.0 billion.
Retail business accounted for $3.3 billion of the latest volume, while wholesale activity was $0.5 billion and correspondent production was $0.8 billion. The bank noted that the retail share of its originations has climbed to 70 percent from just 54 percent a year prior.
Refinance share was 48 percent in the most-recent period.
It looks like third-quarter volume might edge higher based on new applications, which rose to $10.5 billion from $9.1 billion in the first quarter.
SunTrust said that its mortgage servicing portfolio closed out the second quarter at $162.9 billion. At the end of the first quarter the portfolio stood at $164.5 billion, while it totaled $177.8 billion on June 30, 2010.
The third-party portion of the servicing portfolio amounted to $131.5 billion as of the end of June.
Residential mortgages owned by the bank finished last month at $27.7 billion, lower than $28.0 billion at the end of March. A year prior, the total came in at $27.4 billion.
Home-equity holdings eased to $16.2 billion from $16.4 billion and were $17.1 billion at the same point last year.
In addition, SunTrust owned $1.1 billion in residential construction loans, a little less than the $1.2 billion three months prior and lower than $1.5 billion a year prior.
Residential delinquency of between 30 and 89 days as of June 30 was 1.47 percent, lower than 1.60 percent as of March 31. The rate was 1.71 percent at the same time last year. Delinquency reflected a 1.44 percent home-equity rate and residential construction delinquency of 2.28 percent.
Commercial real estate assets fell to $5.7 billion from $6.0 billion in the first quarter and $6.8 billion in the second-quarter 2010. Another $1.7 billion was owned in commercial construction loans, less than $2.1 billion and $3.7 billion in the first-quarter 2011 and second-quarter 2010, respectively.
CRE delinquency slipped to 0.26 percent from 0.33 percent and was much lower than 1.05 percent on June 30, 2010. Commercial construction delinquency rose, however, to 0.63 percent from the first quarter’s 0.47 percent but was better than 1.18 percent 12 months earlier.
The bank had $90 million in mortgage repurchase costs, increasing $10 million from the prior period. Repurchase reserves stood at $299 million as of June 30. Out of $3.9 billion in cumulative repurchase requests, $3.4 billion have been resolved.
Income from mortgage production and servicing came in at $76 million, better than $71 million earned three months earlier and $72 million a year earlier.
The Atlanta-based company said that net income was $178 million on a company-wide basis, easing from the first quarter’s $180 million but way up from $12 million a year prior.
At the end of last month, there were 29,235 full-time equivalent employees on board throughout the organization, more than the 29,052 employed at the end of March.
SunTrust operated 1,661 full-service banking offices as of June 30.
