Make us your home page
Instagram

JPMorgan Chase, Wells Fargo earnings show mortgage markets improving

NEW YORK — Earnings reports Friday from two major banks painted a picture of a healing housing market, with more Americans taking out mortgages, paying them on time and taking advantage of low interest rates to refinance.

At JPMorgan Chase, the biggest U.S. bank, income from new home loans set a record from January through March. The bank issued 6 percent more mortgages than a year ago and got 33 percent more applications.

Wells Fargo, which issues the most home loans, booked the most mortgage fees since 2009. It issued 54 percent more mortgages than a year ago and took 84 percent more applications.

A healthier housing market is welcome news. Housing has been the biggest drag on the economic recovery, while other segments, such as manufacturing and consumer spending, have held up or grown.

Home prices are still falling, though more slowly than in the past several years, and more than half a million American homes were in the foreclosure process at the end of March, according to RealtyTrac.

Still, stronger mortgage business helped JPMorgan and Wells Fargo beat Wall Street expectations for first-quarter earnings.

Two key factors helped:

• The average rate on the 30-year fixed mortgage dropped to 3.87 percent in February, the lowest since long-term mortgages began in the 1950s. Rates have stayed low: This week, the average stands at 3.88 percent.

• Job growth in January and February was some of the strongest since the Great Recession, and the unemployment rate has fallen to 8.2 percent, the lowest since January 2009.

At Wells Fargo, 15 percent of mortgage applications came from the government's Home Affordable Refinance Program, which helps Americans who owe more than their property is worth get more affordable loans.

"It is great to see people who have made their payments every month even though they are underwater, or hugely underwater," CEO John Stumpf said. "And now to be able to help them put a few hundred dollars extra in their pocket every month, that is terrific."

JPMorgan Chase, the largest U.S. bank by assets, turned a $5.4 billion profit for the quarter, down 3 percent from last year but ahead of Wall Street estimates. Wells Fargo made $4 billion, up from $3.6 billion a year ago.

Large banks serve as a barometer of the economy. Citigroup, Bank of America, Goldman Sachs and Morgan Stanley report their results for the first quarter next week.

JPMorgan Chase, Wells Fargo earnings show mortgage markets improving 04/13/12 [Last modified: Friday, April 13, 2012 9:59pm]
Photo reprints | Article reprints

Copyright: For copyright information, please check with the distributor of this item, Associated Press.
    

Join the discussion: Click to view comments, add yours

Loading...
  1. Allegiant Air reports $400 million in revenue for second quarter

    Airlines
    Allegiant Air CEO Maurice J. Gallagher Jr. | [Courtesy of Tony Jannus Aviation Society]
  2. As Dow hits new high, Raymond James Financial reports record financial gains

    Banking

    On the same day that the Dow closed at new highs, investment firm Raymond James Financial reported record revenues and earnings for its fiscal third quarter that ended June 30.

    Raymond James Financial CEO Paul Reilly unveiled record quarterly revenues and earnings for the St. Petersburg-based investment firm. [Courtesy of Raymond James Financial]
  3. Florida GDP growth in first quarter 2017 ranks 21st among states, still outpacing U.S.

    Economic Development

    Florida's gross domestic product or GDP rose 1.4 percent in the first quarter, slightly faster than the nation's growth of 1.2 percent and placing Florida 21st among the states for growth rates, according to the U.S. Bureau of Economic Analysis.

    Not too hot. Not too cold.

    These Jackson Square Townhomes began hitting the west Hillsborough County market late last year and continued to be sold into the first quarter of 2017. The real estate sector was the biggest driver of Florida's gross domestic product, which rose 1.4 percent in the first quartrer of 2017.  [JAMES BORCHUCK   |   Times]
  4. A new app will help you find your favorite Tampa Bay food trucks

    Food & Dining

    What's new: Food tech

    Local food businesses are embracing new technologies and partnerships to bring us extra deliciousness.

    Michael Blasco of Tampa Bay Food Trucks says that everyone always asked about an app to help find their favorite food trucks. There is, available for iPhones and Droids.
  5. Another Pinellas foreclosure auction fools bidders, raises questions

    Real Estate

    For the second time in six weeks, a company connected to lawyer Roy C. Skelton stood poised to profit from a Pinellas County foreclosure auction that confused even experienced real estate investors.

    A Palm Harbor company bid  $112,300 for  this Largo townhome at a foreclosure auction July 21 not realizing the auction involved a second mortgage, connected to lawyer and  real estate investor Roy Skelton -- and that the bank could still foreclose on the  first mortgage.
[SUSAN TAYLOR MARTIN   |   Times]