Data across Curinos’ retail consortium reveal that independent mortgage banks outperformed depository institutions amid a broader contracting market in the latest quarter.
Average mortgage volume across the market in Q4 2023 was down 25% from their levels in the third quarter. IMBs were down 23%, while banks and credit unions saw a 28% drop Q/Q (see chart). This five percentage point gap was largely a result of stronger appetite for loans held for sale following a decline in rates from their October highs – this decline stimulated conforming and government offerings and constrained non-agency demand.Â
Balance sheet lending continued to be less of the total mortgage volume. This decline may be a response to proposed changes to capital requirements that disproportionately impact the competitive advantage held by banks and credit unions. Â
Quarterly Retail Volume Change by Institution Type | All Products | Funded | Q423 vs. Q323​
A decline in balance sheet lending, prompted in part by changes to capital requirements, and a stronger appetite for loans held for sale help explain the gap in lending volume between IMBs and depositories
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