Upon reporting record quarterly earnings this month that more than doubled first quarter earnings in 2012, mortgage giant Ocwen Financial (NYSE: OCN) noted more reverse mortgage opportunity is still on the horizon.
The company posted earnings last week of $45.1 million during the quarter, or 31 cents per share, up from $19.3 million or 14 cents per share in the same quarter during 2012.
In an earnings report filed with the Securities and Exchanges Commission, the company noted its recent acquisition of Genworth’s former reverse mortgage business as presenting increased opportunity in an “untapped” market.
“There is sizable untapped potential in the reverse mortgage market that could sustain future growth,” the filing states.
The transaction was completed on April 1 in a cash purchase for $22 million. The company has retained its Liberty Home Equity Solutions name through the transition.
Ocwen says its position as a top retail and wholesale originator of reverse mortgages will help it break into a market that is still largely under-penetrated.
“Based on CFPB data, we estimate the total potential size of the reverse mortgage market at $1.9 trillion, of which only about 10% has been penetrated to date,” the filing states.”
Written by Elizabeth Ecker
