Feb 13 U.S mortgage lending will likely continue to decline as an increase in mortgages for home purchases fails to offset a slowdown in refinancings, Wells Fargo & Co Chief Financial Officer Tim Sloan said on Wednesday.
Wells is the largest U.S. mortgage lender, and investors have been concerned lately about whether the bank can sustain profits spurred by a boom in mortgage refinancings at low interest rates.
Sloan reiterated that the bank still has a "good opportunity" to refinance eligible homeowners in its $1.9 trillion mortgage servicing portfolio. The bank also has experience in cutting costs when mortgage volume drops off, he said.
San Francisco-based Wells made $125 billion in loans in the fourth quarter, down 10 percent from the previous quarter.
The fourth-largest U.S. bank continues to be active in looking for companies and loan portfolios to buy, Sloan said at an investor conference.
In the past two years, the fourth-largest U.S. bank by assets has been especially active in buying loan portfolios from European banks looking to build capital. That activity slowed in the second half of last year but is "picking up again," he said.
Wells won't be buying a bank because of limits on the total share of U.S. deposits the bank hold, Sloan noted.