June 18, 2018

Obama Efforts to Help Borrowers Improve Lender Profit

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Obama Efforts to Help Borrowers Improve Lender Profit

Wells Fargo & Co. and JPMorgan Chase & Co., the nation's two biggest home lenders, are expecting improved third-quarter profit buoyed by federal government policies intended to help borrowers.

Oppenheimer & Co. analyst Christopher Kotowski says those firms, along with No. 3 U.S. Bancorp and fourth-place Bank of America Corp., may report $6.9 billion of mortgage-banking revenue in the period -- a 37 percent increase from a year ago.

The banks are benefiting as the White House targets residential real estate in an effort to stimulate the U.S. economy. They are earning more on each mortgage they sell as Federal Reserve purchases of mortgage debt widen profit margins.

Source: "Obama-Fueled Mortgages Boost Profit at U.S. Home Lenders," Bloomberg (10/10/12)

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