While non-bank lenders took home billions in profits in the fourth quarter of 2020, Impac Mortgage Holding posted a net loss of $ 2.2 million ($ 0.10 per diluted common share) after the closing bell on Thursday.
The publicly traded Non-QM The lender posted net income of $ 1.6 million and core income of $ 3.3 million for the last quarter. According to Impac, some of the earnings volatility in the fourth quarter of 2020 was due to losses in mortgage service rights, which fell from $ 4.9 billion in 2019 to just $ 30.5 million in 2020.
Impac was one of the many mortgage companies to stop production due to the market ambiguity created by the pandemic. The company resumed taking on GSE and government-backed mortgages in June 2020. It continued its non-mortgage lending operations in the fourth quarterQM Lending and closing totaled $ 810 million – nearly double the lender’s production in the third quarter.
George A. Mangiaracina, Chairman and CEO of Impac, said the company is now well positioned to capitalize on the unprecedented growth of the non-agency credit market.
“Given this margin compression in the GSE product, which we believe will be offset by a shift in production to non-QM and jumbo, where margins are healthier, we are pretty confident that we can continue to run the platform at a positive rate” , he said.