Citi Third Quarter Mortgage Originations Fall 44 Percent

October 16, 2008 No Comments »


The great mortgage origination slowdown seems to be widespread, with Citi reporting both a huge quarterly and year-over-year decline.

Citi recorded third quarter originations of $22 billion, down from $28.5 billion in the second quarter, and 44 percent lower than the $39.4 billion seen a year earlier.

Meanwhile, serious delinquencies continued their march upward, with 3.85 percent of all residential real estate loans 90 days or more past due.

That’s up from 3.12 percent in the second quarter and 1.76 percent in the third quarter of 2007.

Citi’s third party mortgage servicing portfolio fell to $646.5 billion from $648.5 billion in the second quarter, but remains well above the $575.1 billion total from a year ago.

Last week, CitiMortgage reduced its wholesale business significantly, shedding 500 positions and reducing its mortgage broker client base from 9,500 to 1,000.

The move was part of Citi’s overall scheme to focus on direct-to-consumer lending as record mortgage-related losses continue to drag the banking giant down.

The bank and mortgage lender reported a third quarter loss of $2.8 billion, or 60 cents per share, compared to profit of $2.2 billion, or 44 cents per share, a year earlier thanks to continued write-downs and hefty credit losses.

Citi said headcount was reduced by roughly 11,000 since the second quarter and about 23,000 since the beginning of the year.

(photo: jurekd)

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