Residential loan originations came in lower at U.S. Bancorp, though the company grew its mortgage servicing portfolio, increased its home loan assets and cut its delinquency rate.
(After this story was published, a U.S. Bank spokeswoman explained that residential originations generated for its investment portfolio are in addition to its regular residential originations. The total was revised to reflect the update.)
In its third-quarter earnings report, the Minneapolis-based firm disclosed $21.506 billion in residential loan production including mortgages sold, residential loans funded for its own portfolio and portfolio home-equity loans.
Business was off from the prior three-month period, when a revised $23.881 billion was originated. The decline was more stark compared to the same three-month period in 2012, when $26.708 billion in home loans were funded.
The latest activity included $15.192 billion in home loans that were sold, $5.005 billion in loans held for investment and $1.309 billion in HEL production held for investment.
A total of $72.240 billion was originated during the first three quarters of 2013.
Business appears to be headed lower based on a steep drop in mortgage application volume — to $13.335 billion from the second quarter’s $23.867 billion.
U.S. Bank serviced $226.727 billion in home loans for investors, a little more than the $223.904 billion third-party servicing portfolio as of June 30 and climbing from the $211.263 billion portfolio one year prior.
Assets included $50.170 billion in residential loans, more than $47.753 billion owned three months earlier and $41.902 billion owned a year earlier.
Residential mortgages represented $36.484 billion of the latest total, and first lien HELs made up $13.686 billion.
Delinquency of at least 30 days, including nonperforming loans, was trimmed to 2.69 percent from 2.74 percent three months earlier and down from 3.46 percent a year earlier.
In addition, U.S. Bank owned $15.544 in home-equity and second mortgages, less than $15.816 billion on the books at the end of June and $17.119 billion at the same point last year.
HELÂ delinquency fell to 2.05 percent from 2.22 percent and was also lower than 2.18 percent as of the same date in 2012.
The balance sheet reflected $38.678 billion in commercial real estate loans, slightly more than the $38.298 billion reported as of June 30 and up from $36.813 billion as of Sept. 30, 2012.
Last month’s CRE holdings included $31.467 billion in commercial mortgages and $7.211 billion in construction-and-development loans.
The rate of 30-day delinquency on the CRE portfolio was cut to 1.10 percent from 1.37 percent and has tumbled from 1.92 percent as of Sept. 30, 2012.
U.S. Bank finished the third quarter with $114 million in outstanding repurchase and make-whole requests. Third-quarter repurchase payments were $42 million, and $176 million in repurchase reverses were on the balance sheet.
Income before taxes improved to $524 million from the prior period’s $515 million and from the year-earlier period’s $513 million.
As of the end of the third quarter, 3,088 branches were open, one more than at the end of the second quarter.
