Wells Fargo, which used to be the largest mortgage provider in the country, downsized its home lending business early this year. The company posted a 42% year-over-year slump in its mortgage banking income driven by lower originations and lower revenue from the re-securitization of loans purchased from securitization pools.
As part of its new strategic plans, Wells Fargo laid off more than 500 workers in February. The company’s new strategy involves reducing the size of its servicing portfolio and closing its correspondent channel.
“We announced in January strategic plans to create a more focused home lending business,” Wells Fargo told Bloomberg. “As part of these efforts, we have made displacements across our home lending business in alignment with this strategy and in response to significant decreases in mortgage volume in the broader market environment.”
Commenting on the recent bank closures, Scharf said: “We are glad to have been in a strong position to help support the US financial system during the recent events that impacted the banking industry… Our diversified business model, strong capital position, mix of deposits, access to funding sources, and continued focus on financial and credit risk management allow us to support our customers throughout the economic cycle.
“Looking ahead, we continue to move forward on our risk and control agenda, which is our top priority. While we have made progress, our work is not done, and we remain focused on completing the work in a timely fashion. At the same time, we are executing on our other strategic objectives, including developing improved products and services to better serve our customers, investing in our communities, and generating appropriate risk-adjusted returns.”
Source: mpamag.com