PHH Corp. lost $46 million in the second quarter as it continues efforts to exit mortgage origination and servicing and instead focus on subservicing.
The company added a $13 million pretax provision to its reserves to help pay for
The Mount Laurel, N.J.-based company lost $12 million for the second quarter of 2016. PHH had a
Even though the settlement was announced on Aug. 8, the $13 million provision to its legal and regulatory reserves was made during the second quarter.
The company also took a $4 million pretax loss on its mortgage servicing rights sales with an additional $1 million for transaction costs. Exit and disposal costs added another $16 million to PHH's pretax expenses.
Revenue fell to $112 million in the quarter from $196 million one year prior as origination fees fell to $37 million from $79 million and loan servicing income went down to $28 million from $44 million. PHH is
The initial asset sale from the
PHH completed the sale of its
The sale of $39.8 billion of
PHH will subservice both MSR portfolios for a five-year period.
PHH's origination's segment lost $25 million in the second quarter, compared with a profit of $13 million one year prior, as the company moved ahead with its plan to exit the private-label loan production business.
Origination volume was $5.5 billion for the quarter, down from $10.4 billion for last year's second quarter. The bulk of the decline came from the private-label segment, to $3.6 billion from $8 billion over the same period.
PHH lost $43 million in its servicing business compared with
The subservicing portfolio consisted of 351,109 loans on June 30, down 28% from 486,596 loans on June 30, 2016. The decline was primarily driven from the fourth quarter of 2016 insourcing and MSR sale actions of two clients, partially offset by the addition of subserviced loans from the June 2017 sale of MSRs to New Residential.
The owned MSR portfolio of 379,231 loans (down from 509,976 one year prior) included the Fannie Mae MSRs that New Residential acquired in July.