Impac Mortgage Holdings reported a second straight year of losses. Earnings were down for the fourth quarter as well.
Impac reported the net loss for the year ended Dec. 31, 2022 increased to $39.4 million as compared to $3.9 million for the year ended Dec. 31, 2021. The year-over-year increase in net loss was primarily due to a $59 million decrease in gain on sale of loans, net, coupled with a $2.9 million decrease in other income, which was partially offset by a $25.1 million decrease in operating expenses.
Total expenses decreased to $56.1 million for the year ended Dec. 31, 2022 compared to $81.2 million for the comparable period 2021. Personnel expense decreased $22.1 million to $30.7 million for the year ended Dec. 31, 2022 as compared to $52.8 million in the same period in 2021. The decrease in personnel expense was primarily related to a reduction in variable compensation, as well as a reduction in headcount to support reduced volume as compared to the same period in 2021. Average headcount decreased 37% to 210 for the year ended Dec. 31, 2022 as compared to 335 for the same period in 2021.
Last week, the California-based Impac Mortgage Holdings Inc. announced major changes, converting to a mortgage broker model, announcing plans to “wind down” its third-party origination channel, and voluntarily giving up its seller/servicer designation with the government-sponsored enterprises.
In a news release, the Newport Beach-based mortgage lender and servicer said the changes are being made as it reviews its operations and expenses in order to better “navigate current market and industry conditions.”
For the fourth quarter of 2022, Impac reported a net loss of $11.8 million, or $0.38 per diluted common share, and an adjusted earnings loss of $11 million, or $0.35 per diluted common share, as compared to net earnings of $3.6 million, or $0.15 per diluted common share, and an adjusted earnings loss of $5 million, or $0.23 per diluted common share, for the fourth quarter of 2021.
