Forget Recovery: Barclays Is Shutting Down Its Wealth Management Businesses In 130 Countries!! Q3 Earnings Surprises Incoming!!
September 26th, 2013
Q3 2013 Earnings\Financials: The Party is Over
It’s once again earnings season and a great deal of attention will be focused on financials. Over the past three months, the equity market values of most of the largest universal banks have traded off as investors have started to appreciate that the party is ending in terms of new mortgage originations driven by refinance transactions. As I noted in the last post, the guidance from all of the big banks is decidedly negative for Q3 because of the prospective decline in revenue and transaction volumes in mortgages.
While refinance transactions are falling rapidly, mortgage loan purchases volumes are not growing nearly enough to make up for the drop in overall volumes. The chart below shows the total loan originations, refinance and purchase volumes for all lenders from the Mortgage Bankers Association through Q1 2013: