JPMorgan Chase and Wells Fargo both posted their second quarter earnings for calendar year 2013 on Friday, indicating strong financial results across the board. Chase posted mortgage earnings nearly three times the amount of Wells Fargo’s, however; both are citing the second quarter as tremendously positive, to the point where both are leading the pack in terms of earnings.
"However, we continue to see broad-based signs that the U.S economy is improving," JPMorgan CEO Jamie Dimon said. "We are hopeful that as jobs are added and confidence builds, the U.S. economy will strengthen over time."
Chase's ortgage originations totaled $49 billion in Q2, up 12 percent from the prior year and down seven percent from Q1, including purchase originations of $17.4 billion, up 50 percent from the prior year and 44 percent from the prior quarter. Chase attributes that decline to a decrease in “mortgage fees and related income,” according to their quarterly report. While originations are down based on the previous quarter’s results, at a yearly-level, originations were higher.
Wells Fargo posted non-interest income around $2.8 billion, which was in line with their previous quarter for the year. During the second quarter, residential mortgage originations were $112 billion, up slightly from $109 billion in first quarter 2013, however gain on sale margins declined as expected. Mortgage servicing rights (MSRs) resulted in $68 million in revenue, compared to the $129 million from the first quarter. Mortgage escrow deposits were up $4.2 billion, totaling $39.6 billion, up from the previous year. Total loans for Wells-Fargo were up $2.0 billion from the previous quarter, posting a total of $802 billion.
"Compared with the prior quarter, we grew loans, deposits, and net interest income, and both our efficiency ratio and credit quality improved," said Wells Fargo Chairman and CEO John Stumpf. "Wells Fargo again demonstrated an ability to grow during a dynamic economic and interest rate environment, and we feel very well positioned to continue to perform for our shareholders over the long term.”