Claims top home equity portfolio lender spot
By MortgageDaily.com staff
4/19/2002

Wells Fargo & Company said in its first quarter earnings announcement that its mortgage origination volume was $68 billion during the period, a 134% increase from the first quarter of last year. The company reported that total loans averaged $172 billion for the quarter, eight percent higher than the same period last year and six percent higher when adjusted for acquisitions.

Wells said home equity loan balances were up 46% from the previous year. The company reported that SMR Research ranked it now as the number one home equity portfolio lender in the U.S., with $28 billion in loans outstanding. Wells said it has grown 25% faster than the industry as a whole in this area since the November 1998 Norwest-Wells Fargo merger.

"We are extremely pleased with the continued strong consumer loan growth largely driven by strong sales of our industry-leading home equity and home mortgage products," said Chief Financial Officer Howard Atkins.

The company, which was founded 150 years ago by Henry Wells and William G. Fargo, said its commercial loans outstanding had a modest decline.

Wells said during the quarter its mortgage servicing portfolio surpassed the half trillion dollar milestone, ending the quarter at $513 billion. Excluding subservicing, the servicing portfolio grew $32 billion or 7.6 percent, ending the quarter at $457 billion with a weighted average note rate of 7.07% -- the lowest in the last decade.

Wells reported end-of-quarter average mortgage-backed securities of $31.8 billion with a yield of 7.08%, compared to $26.7 billion at 7.27% during the first quarter of 2001.
The company, which says it is the 5th largest bank in the U.S., reported record net income for the quarter of $1.38 billion, up 18% from last year's $1.17 billion. Wells said under FAS 142, Goodwill and Other Intangible Assets, it was required to assess goodwill for impairment and to discontinue amortization of goodwill as of January 1, 2002. During the quarter, the company recorded a $276 million (after tax) transitional goodwill impairment charge as a cumulative effect of a change in accounting principle.

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