Lower interest rates increased Bank of America’s first-quarter residential mortgage volume by 21% over the previous year, while home equity dropped by 25%.
The bank originated $11.46 billion during the quarter, including $8.16 billion in its consumer banking unit. The rest came from its global wealth and investment management segment.
The digital channel contributed 20% of consumer mortgage applications during the period.
BofA stopped reporting mortgage revenue separately one year ago. It now includes it in the all other lines in the consumer banking noninterest income. There was $309 million of all other income in the first quarter, down from $427 million in the fourth quarter, but up from $225 million in the first quarter of 2017.
But the lower rates reduced BofA home equity lending volume to $2.8 billion, down from $3.6 billion in the fourth quarter and $3.75 billion in the first quarter 2017. The consumer banking segment contributed $2.5 billion for the first quarter, compared with $3.2 billion in the fourth quarter and $3.4 billion one year ago.
“We continue to share success: We will raise the minimum starting pay in our company to $20 over the next 24 months, we’ll help 20,000 low-to-moderate income clients become homeowners and we extended our environmental business initiative to $300 billion over 10 years to help create a low-carbon sustainable future,” Chairman and CEO Brian Moynihan said in a press release. “We serve by asking the simple question to customers, employees and communities: ‘What would you like the power to do?’ We listen to them and serve them with a team that is second to none.”
There was a reduction in nonperforming residential real estate loans from previous quarters. As of March 31, BofA had $1.77 billion of nonperforming mortgages and $1.75 billion of nonperforming home equity loans, compared with $1.89 billion in each category at the end of the fourth quarter and $2.63 billion in mortgage and $2.6 billion in home equity loans.