It’s earnings report time! Real estate and mortgage giants have begun publishing their wins and losses for the first quarter of 2023 and we’re tracking all the numbers for you.
loanDepot Increases First Quarter Revenue By $38.2 Million
Mortgage companies are dropping their first quarter earnings reports and loanDepot is boasting a profitable three months. According to a company statement to investors, loanDepot increased Q1 revenue by $38.2 million from the fourth quarter of 2022.
With reduced total expenses, loanDepot managed to think its net loss to $91.7 million from fourth quarter 2022. The company maintained strong liquidity profile, exiting the quarter with a cash balance of $798.1 million.
“The first quarter of this year remained challenging for the housing market as virtually all participants grappled with the impacts of ongoing volatility in mortgage interest rates, persistent cost inflation and the lack of available homes for sale,” said President and Chief Executive Officer Frank Martell. “Against this backdrop loanDepot continued to execute against our Vision 2025 plan, narrowing our loss from the fourth quarter of 2022 on higher revenues and lower expenses. Although the affordability and availability of new and existing home sales remains challenging for the industry overall, we expect to continue to benefit from seasonally higher revenues and our ongoing cost reduction program. Assuming the expected benefits of continuing seasonal volume increases and cost productivity, we expect to deliver improving financial results over the course of the second and third quarters of 2023.”
Fannie Mae and Freddie Mac Remained Profitable
Brokerages may have had a tough quarter but the same was not necessarily true for mortgage giants Fannie Mae and Freddie Mac. The pair acquired $127 billion in single-family mortgages during the first three months of the year. Impressive, but still a 72 percent decline from a year ago.
Fannie Mae recorded $3.8 billion net income for the first quarter 2023, with net worth reaching $64 billion as of March 31, 2023. Net income increased $2.3 billion in the first quarter of 2023 compared with the fourth quarter of 2022, primarily driven by a $3.2 billion decrease in provision for credit losses.
“We delivered strong first quarter results in a volatile market and remain committed to being a source of stability for the housing finance system throughout all economic cycles,” said Priscilla Almodovar, Chief Executive Officer. “We are able to do so because of the changes we’ve made to improve the resilience of our business, our focus on risk management, and strong liquidity. This allows us to continue to facilitate affordable, equitable, and sustainable access to homeownership and rental housing.”
Freddie Mac reported net income of $2 billion, financing 190,000 mortgages, with 54 percent of eligible loans being affordable to low- to moderate-income families, and enabled 72,000 first-time homebuyers to purchase a home. The company posted net revenues of $4.8 billion, a decrease of 17 percent year-over-year, as higher net interest income was offset by a decline in noninterest income.
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