March 2016 - RIP Dodd Frank

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TH E M R EP O RT | 47 O R I G I NAT I O N S E R V I C I N G A NA LY T I C S S E C O N DA R Y M A R K E T DEPARTMENT ORIGINATION ORIGINATION THE LATEST Bank of America, Morgan Stanley Report Strong 2015 Earnings AFTER SIGNIFICANT LEGAL BURDENS IN 2014, BOTH BANKS POSTED INCREASED EARNINGS IN 2015. NORTH CAROLINA // With multibillion dollar mortgage- backed securities settlements mostly in the rear view mir - ror, Charlotte-North Carolina- based Bank of America and New York-based Morgan Stanley both posted solid results in their respective Q 4 and full year 2015 earnings statements released. Without the legal expenses and related charges that plagued them in 2014, Bank of America reported a net income of $15.9 billion for the full year of 2015—more than triple the bank's reported net income of $4.8 billion for 2014, a year in which the bank entered into a $16.65 billion settlement with the Justice Department and several states over the sales of faulty MBS. In fact, Bank of America's earnings for 2015 were the highest for the bank since the pre-crisis year of 2006, when it reported a record net income of $21.1 billion. Bank of America's Q 4 net income was reported at $3.3 bil - lion, down from $4.5 billion the previous quarter but up from $3.1 billion year-over-year. "The 2015 results were our highest earnings in nearly a decade, reflecting the work we've done to develop a straightforward operating model focused on re - sponsible growth and doing more business with each customer and client," Bank of America CEO Brian Moynihan said. "We saw solid customer activity in loan growth, deposits, and wealth management asset flows, and we returned more capital ($1.3 billion) to our shareholders. As we build on this progress, we will continue to invest in the future and man - age expenses." Likewise, with legal cost bur- dens removed, Morgan Stanley's reported net income for the full year of 2015 was $6.1 billion, up from $3.5 billion in 2014. In February 2015, Morgan Stanley entered into a settlement with the Justice Department for $2.6 billion to resolve claims that the investment firm packaged and sold toxic MBS in the run-up to the crisis. With litigation costs of $3.1 billion reported for 2014 as a result of the settlement, the firm's earnings took a significant hit. The year 2015 started out strong for Morgan Stanley, with net incomes of $2.4 billion, $1.8 billion, and $1.7 billion for the first three quarters, respectively. The firm's net income for Q 4 2015 was $908 million on net revenues of $7.7 billion. "A strong overall performance in the first half of the year was impacted by difficult market conditions in the second half that dampened trading activity," said James P. Gorman, Chairman and CEO of Morgan Stanley. "In the fourth quarter we took action to meaningfully restructure our fixed income business on a capital and expense basis. We enter 2016 with a continued focus on managing ex - penses across the firm and driving up returns for our shareholders." While Bank of America's mortgage production was up by 13 percent in Q 4, the bank's Legacy Assets and Servicing (LAS) Division—which works with customers who are delinquent on their mortgage payments—saw some major cuts in 2015 due to the reduction in distressed mort - gage loan volume. The number of employees in the LAS Division declined by 35 percent in 2015 down to about 11,200, while the number of 60-plus day delinquent loans serviced declined by 46 percent down to about 103,000. Our Proud National Sponsors: Associate Member: Competition Is Fierce in Title and Closing Services Don't Outrun the Competition. Outshine the Competition. Affinia Title Lora Henke Servicing Area: Georgia, Florida, Alabama 407.792.6762 ALAW / Brightline Title Jonathan Sawyer Servicing Area: Florida, Georgia, Texas 813.221.4743 Allegiance Title Co. John Hall Servicing Area: Texas 214.635.3700 Alliance Title & Escrow Corp./AmeriTitle, Inc. Jenny Martin Servicing Area: Idaho, Oregon, Montana, Washington, Wyoming 208.955.9681 Brady and Kosofsky Jaime Kosofsky Servicing Area: North Carolina, South Carolina 704.849.8008 Continental Real Estate Services Katie Van Hook Servicing Area: Missouri, Kansas, Wisconsin, Nebraska, Arkansas, Colorado, New Mexico, North Dakota, South Dakota, Minnesota, Ohio, Iowa 314.862.2447 Delta Title Corporation Howard Leach Servicing Area: Louisiana, Mississippi 504.885.9222 First Financial Title of MN Larry Zielke Servicing Area: Minnesota 952.831.5010 First International Title Jim Moran Servicing Area: Florida 954.905.3881 Independence Title Brian Pitman Servicing Area: Texas 512.454.4500 LandCastle Title Paul Kemp Servicing Area: Alabama, Florida, Kentucky, Ohio 205.972.0272 Liberty Bell Agency, Inc Jim O'Rourke Servicing Area: Pennsylvania, New Jersey 215.625.3660 McDonnell and Associates, PA Dawn Player Servicing Area: South Carolina, North Carolina, Georgia 866.931.8793 Mortgage Connect Carla Kennedy Servicing Area: All 50 States 1.866.789.1814 NETCO Title Ivy Melton Servicing Area: All 50 states 949.598.1855 Oklahoma REO Closing & Title Services, LLC Scott E. Coulson Servicing Area: Oklahoma 918.491.3113 Omega Title Agency, LLC John D. Clunk Servicing Area: Ohio, Kentucky 330.436.6700 Paramount Land Jeffrey Zipser Servicing Area: New York 631.224.1345 RedVision Systems, Inc. Ailie Ashton 973.854.9582 1055 Parsippany Boulevard, Suite 412 Parsippany, NJ 07054 TASC Victoria Schlicher Servicing Area: North and South Carolina 336.794.7956 x2805 UniversalAdvantage Nick Hacker Servicing Area: Minnesota and North Dakota 701.751.4995 WFG National Title Insurance Company Anthony Nalbone Servicing Area: All 50 States 602.820.6264 By engaging the Title and Closing Coalition*, lenders, servicers, and asset managers fast-track their way into a national referral network of seasoned title and closing professionals. Our members have specialists in all 50 states ready to handle your end-of-transaction service needs. For more information about the Title and Closing Coalition or to join the organization, please contact Derek Templeton, Interim Executive Director at 214.525.6757 or *a FIVE STAR INSTITUTE membership group

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