B of A Loses a Ton on Consumer Real Estate, Home Loan Fundings Fall

Bank of America funded $58.4 billion of home mortgages in the first quarter, a 33% decline compared to 4Q, and a further sign that the megabank — like many others — is suffering from a weak home buying market.

Overall, the nation’s largest servicer of home mortgages posted a company-wide profit of $2 billion in 1Q, but its earnings were dragged down by a $2.4 billion loss in its consumer real estate services division.

B of A reported first lien originations of $56.7 billion in the quarter, and second lien fundings of $1.7 billion.

Mortgage banking income came in at $694 million. Its consumer real estate division reported total revenue of $2.1 billion.

The bank also booked $4.9 billion in non-interest expenses on its legacy servicing assets (tied to Countrywide Financial Corp.) and set aside $1.1 billion to cover expected loan buybacks from the GSEs and insurance cancellations from mortgage insurers.

B of A said it entered into an agreement with Assured Guaranty of Bermuda to resolve all outstanding and potential representation and warranty claims.

Charge-offs on first mortgages totaled $905 million, compared to $970 million in the fourth quarter.

As of March 31, the Charlotte-based bank held $261.8 billion of first mortgages and $133.6 billion in home equity loans, little changed from the fourth quarter.