AccessMyLibrary provides FREE access to over 30 million articles from top publications available through your library.
Create a link to this page
Copy and paste this link tag into your Web page or blog:
Rise in Servicing Values Helps Offset Loan Sales Problem at WaMu.
The chief executive of Washington Mutual Inc. said because of a mismatch between loan commitments and hedging, the company will take a loss during the quarter from the sale of mortgage loans. But some of the damage will be mitigated by servicing gains.
Kerry Killinger was speaking at the Lehman Brothers Financial Services Conference here.
He said that Seattle-based WaMu has a "balanced business model" so that the company will perform well in any interest rate environment.
During the refinance boom, the company had large gain on sale of loans with diminished asset growth and a reduced value of servicing rights. Now that rates have risen, that has turned around.
WaMu records the gain on sale of fixed-rate loans at the time the customer locks the interest rate.
During the presentation, Mr. Killinger, also president and chairman of WaMu, admitted that "several process and systems issues" at WaMu resulted in imprecision in its tracking of loan commitments. The spike in interest rates brought the problem out in the open as closing volumes increased.
As a result of these problems, WaMu will report a loss instead of a gain on sale. This loss will only be partially offset by the company's pipeline hedging activities.
- WaMu goes out on limb by not publishing interest rates.(Washington Mutual Inc.)
- Magazine article from: Los Angeles Business Journal Toledano, Jessica February 1, 1999 700+ words
...statewide regularly report their interest rates for comparative surveys that...maintaining consumer awareness. But WaMu has decided not to release...solely based on rates," said WaMu spokesman Adrian Rodriguez...right." As it turns out, WaMu's rates are among the most...
- WAMU'S KILLINGER STILL UPBEAT NO BIG PROBLEMS SEEN FROM ASIA OR LOWER INTEREST...
- Newspaper article from: Seattle Post-Intelligencer (Seattle, WA) Virgin, Bill January 9, 1998 700+ words
...performance and slumping long-term interest rates aren't enough to make a big impact...over concerns about what declining interest rates or an economic slowdown will do to...impact by holding down short-term interest rates. Killinger said Washington Mutual...
- Double WaMu; Mortgage banks.
- Magazine article from: The Economist (US) August 21, 2004 700+ words
...years of stellar growth, WaMu announced in late July...the bank blamed rising interest rates for its woes, its problems...other mortgage banks, WaMu made huge profits from...cheaper rates. But as interest rates have touched bottom...
- WaMu lowers 2004 earnings outlook.(Business Alert)(Washington Mutual Inc.)
- Magazine article from: Mortgage Banking August 1, 2004 700+ words
...MUTUAL INC. (WAMU), Seattle...in long-term interest rates will significantly...guidance. Higher interest rates have lowered WaMu's mortgage...The rise in interest rates is not expected...performance of WaMu's Retail Banking...
- WaMu Ready to Grow Again?
- News wire article from: Mortgage Line Cornwell, Ted May 2, 2005 700+ words
...769 billion a year earlier. WaMu's mortgage banking group...favorable MSR performance, WaMu said that higher gains from...very sensitive to changes in interest rates. "We manage it for the long...positive earnings report, WaMu's shares lost ground in trading...
- WAMU THE CONQUERER: Washington Mutual becomes the superhero of the thrift...
- Magazine article from: US Banker Fogarty, Mark July 1, 2001 700+ words
...sees a strategic advantage in WaMu's adoption of strengths of...80% of it in mortgages. (WaMu also has an active consumer...receded as a combination of high interest rates, deregulation and bad or crooked...become a national player. But WaMu took advantage of the problems...
- WaMu Will Take Hit From Mortgage Sales.
- Magazine article from: National Mortgage News Finkelstein, Brad September 15, 2003 700+ words
...systems issues" at WaMu resulted in imprecision...commitments. The spike in interest rates brought the problem...of these problems, WaMu will report a loss instead...because of the rising interest rates, WaMu has seen "a large recovery...
- Mortgages Smothering WaMu's Growth in Cards?: CreditSights analysts say...
- Magazine article from: National Mortgage News November 27, 2006 700+ words
...But CreditSights noted that WaMu faces pressure on card delinquency...rates artificially low, and WaMu executives said they agree...low unemployment rates, low interest rates, low energy costs and strong...Also, CreditSights said WaMu still faces potent competition...
Source: HighBeam Research, Rise in Servicing Values Helps Offset Loan Sales Problem at WaMu.