The second quarter of 2018 has proven a strong one for First National Financial Corporation.
Its home and commercial mortgage lending business posted gains in new originations of 9% to $5.1 billion from $4.7 billion a year earlier.
Mortgages under administration at June 30, 2018 reached a record high of $103.6 billion from $99.5 billion a year earlier, a 4% increase year-over-year.
Total originations together with renewals amounted to $7.3 billion, up 18% from $6.2 billion in Q2 2017. New single-family originations were $3.4 billion, up 5% year over year, while single-family renewals were $1.9 billion, up 45% year over year.
New commercial originations of $1.7 billion were 17% higher than a year ago, while commercial renewals of $299 million were 33% above the second quarter of 2017.
“The second quarter was highly productive for First National in both single family and commercial mortgage lending with both segments of the business generating solid growth on the basis of customer service,” said Stephen Smith, Chairman and Chief Executive Officer. "As a consequence of strong new originations and renewal volumes, MUA continued to climb, which is broadly positive for future financial performance and illustrates that First National is responding well to changing market conditions.”
Revenue, income lower
Revenue was down slightly to $290.9 million compared to $292.2 million in Q2 2017 and net income was significantly lower at $46.3 million compared to $68.8 million.
“While earnings, adjusted for fair value considerations, were lower by 18%, this was partially because we shifted mortgages to our securitization programs, which defers the earnings process until the securitization cash flows come in over five and 10-year terms,” explained Smith. “Considering the housing market interventions made over the past 18 months by various governments, strong competition and tighter mortgage spreads, we are pleased with the Company's ongoing progress."