Mortgage Scene: After all the Big Deals, How Large Can WaMu Get?(Washington Mutual Inc.)(Brief Article)

At year-end, Washington Mutual had $15.2 billion in residential servicing rights on its books and ranked 33rd among all mortgage bankers in the nation.

Of course, "year-end" in this case was year-end 1995. In six short years, WaMu has become not only the nation's largest thrift, but the 600-pound gorilla of mortgage banking. It's now No. 1 with a bullet.

Don't be alarmed. There are still plenty of 500-pound gorillas out there that plan on giving WaMu a run for their money - both in terms of production and servicing.

However, once WaMu swallows HomeSide Lending of Jacksonville, Fla., it will have a servicing base (including subservicing contracts) of $750 billion and a servicing market share of almost 14%.

Never before in the annals of mortgage banking has one firm controlled so much of the receivables market. The obvious question for mortgage professionals boils down to this: What does all this mean for the rest of us? Should we get out while the getting is good?

It's no secret that WaMu will continue on what it calls its "buy-and-build" strategy. Its goal, according to mortgage chief Craig Davis, and company chairman Kerry Killinger, is to increase its market share to 20% in terms of servicing and production.

There are few in the industry who doubt WaMu will eventually get there, the question is when. But getting to 20% may be a lot tougher than getting to 14%.