Q2 mortgage volumes improve at Wells Fargo, JPMorgan and Citi


“Credit performance during the second quarter was consistent with our expectations,” Wells Fargo CEO Charlie Scharf told analysts. “Consumers have benefited from a strong labor market and wage increases. The performance of our consumer auto portfolio continued to improve, reflecting prior credit tightening actions, and we had net recoveries in our home lending portfolio.” 

Citi, the smallest of the three depositories in the mortgage arena, originated $4.3 billion in home loans from April to June, up 39% from the previous quarter but down 4% from the same period in 2023. 

Amid higher origination levels, JPMorgan also grew its servicing portfolio in the second quarter, which was not true for Wells Fargo. JPMorgan’s mortgage servicing rights (MSRs) increased to $8.8 billion in Q2 2024, up from $8.6 billion in Q1 2024 and $8.2 billion in Q2 2023. 

Meanwhile, Wells Fargo’s MSRs — as measured by the carrying value at the end of the period — declined by 3% quarter over quarter to $7 billion in Q2 2024. The unpaid principal balance (UPB) decreased by 14% compared to the same quarter last year. 

Generating revenues

Home lending activity brought in $1.3 billion in net revenues for JPMorgan in Q2 2024, up 11% from $1.18 billion in the previous quarter. The bank had $189 million from servicing revenues in Q2 2024, compared to $144 million in the previous quarter. 

Jeremy Barnum, JPMorgan’s chief financial officer, told analysts that the performance of home lending revenues was “predominantly driven by higher net interest income.” 

Wells Fargo delivered $823 million in revenues related to its home lending business in Q2 2024. The bank said in a statement that home lending was down 3% year over year “on lower net interest income on lower loan balances” and down 5% from the previous quarter “on lower mortgage banking income.” 

According to chief financial officer Michael Santomassimo, Wells Fargo’s revenue reduction reflects its focus on simplifying the home lending business and the ongoing decline in the mortgage market. “Since we announced our new strategy at the start of 2023, we have reduced the headcount of home lending by approximately 45%,” he said.

The bank also generated mortgage banking non-interest income of $243 million in Q2 2024, an increase from $230 million in the previous quarter. Its net servicing income declined 2% quarter over quarter but increased 44% year over year to $89 million.  

Overall, JPMorgan delivered $18 billion in profits — or $13.1 billion when excluding extraordinary items, such as a multibillion-dollar gain tied to a Visa share exchange — in the second quarter while the economy saw “some progress bringing inflation down,” according to CEO and chairman Jamie Dimon. 

“But there are still multiple inflationary forces in front of us: large fiscal deficits, infrastructure needs, restructuring of trade and remilitarization of the world. Therefore, inflation and interest rates may stay higher than the market expects,” Dimon said in a statement. 

Wells Fargo reported $4.9 billion in net income in the second quarter, while Citi delivered $3.2 billion during the period. Citi CEO Jane Fraser said the bank has made “an incredible amount of progress in simplification — both strategically and organizationally.” 



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