HW Media connects and informs decision makers across the housing economy. Professionals rely on HW Media for breaking news, reporting, and industry data and rankings. Moving the Housing Market Forward.

Provident Financial abandons mortgage banking

Plans to layoff 122 staffers in the coming months

[Update: An earlier version of this article contained comments from a closed Facebook community. Those comments were removed as well as accompanying text.]

Provident Financial Holdings announced its exit from mortgage banking earlier this week. 

In a released statement the firm said challenging economic and operating conditions made it difficult to make a profit in home loan originations. The company’s CEO also cited “required investments in expensive technology” as another reason.

The company plans to layoff 122 full-time-equivalent employees, presumably working in the now-abandoned Provident Bank Mortgage brand, in the coming months, though it will not exit the mortgage lending industry entirely. PBM will be retired by the end of June.

“The company plans to continue to originate single-family mortgage loans for retention on its balance sheet, both within its market area, the Inland Empire region of Southern California and other locations in California,” the statement said. “Also, the company will continue to purchase these loans consistent with its historical activity.”

Craig Blunden, the company’s chairman and CEO said that, in its role as a community bank, they will be increasing single-family mortgage loans and higher-yielding loans such as multi-family, commercial real estate, construction, and commercial business loans held for investment.

“We have been in the mortgage banking business for many years and have weathered unfavorable mortgage banking environments in the past,” Blunden said.

“Unfortunately, the current poor operating environment is coupled with fundamental changes in the mortgage banking industry such as more burdensome regulations, required investments in expensive technology, fierce competition, and razor thin profitability, to name a few,” he added. 

The company estimates that it will incur one-time costs of approximately $3.6 million to $4 million during the remainder of fiscal 2019.



Most Popular Articles

3d rendering of a row of luxury townhouses along a street

Log In

Forgot Password?

Don't have an account? Please