Impac Mortgage (IMH) posted a first-quarter net loss of $3 million, or $0.33 per diluted share, as compared to a net loss of $738 thousand or $0.8 per diluted common share in the first quarter of 2013, and a net loss of $3.7 million or $0.42 per diluted share in the fourth quarter of 2014.
Originations decreased 48% from the first quarter of 2013, down to $353.1 million. Impac attributes most of that to the sale of their brick and mortar branches at the end of last year, which accounts for $180 million of the decline.
"Excluding the production from our retail branches, the decline in our origination volumes appears to be better than the rest of the mortgage market which saw declines of 57% and 23% in the first quarter of 2014 as compared to first quarter of 2013 and fourth quarter of 2013, respectively," the report states.
Mortgage lending revenues and margins declined to $4.4 million from $16.7 million a year ago, and $7.6 million in the fourth quarter 2013.
Other highlights from the earnings report:
- Mortgage servicing fees increased in the first quarter of 2014 to $1.6 million from $1.0 million in the first quarter of 2013 and as compared to $1.3 million in the fourth quarter of 2013.
- In the first quarter of 2014, Impac completed the previously discussed sale of AmeriHome Mortgage Corp. (AmeriHome) for a cash price of $10.2 million, resulting in a return on investment in the entity near 20%.
- We sold mortgage servicing rights in the first quarter at a small premium to book value generating $5.8 million in cash proceeds in the first quarter, with additional proceeds to be received at the time of transfer during the second quarter.
- The mortgage servicing portfolio declined in the first quarter of 2014 to $2.2 billion at March 31, 2014 from $3.1 billion at December 31, 2013. This decline was due to servicing sale of $522.2 million as well as the sale of AmeriHome and its servicing portfolio of $702.1 million, partially offset by the servicing retained loan sales in the quarter of $374.4 million.
- In the first quarter of 2014, our correspondent channel contributed 65% of originations as compared to 23% in the first quarter of 2013. Therefore, although there was industry-wide margin compression during the first quarter, we have seen this compression abate in April.