Slower housing market bites into First National originations
Revenue declined 9% to $565.2 million, partly reflecting lower placement fees on a weaker volume mix. Placement-fee revenue fell 36% to $51.9 million as new single-family placement activity slowed and renewals — which typically generate lower fees than new originations — comprised a larger share of total volume.
Excluding acquisition-related accounting charges and other items, underlying pre-tax income fell 35% to $50.9 million, with the company pointing to $12.5 million in additional interest costs associated with higher post-acquisition debt, alongside lower placement fees, higher credit-loss provisions, and increased employee costs.
Portfolio growth continues despite volume pressure
Despite the quarterly origination softness, First National’s mortgages under administration (MUA) grew to $169.8 billion at June 30, up approximately 6% from $159.9 billion a year earlier.
The single-family portion of the portfolio was little changed at $98.6 billion, while multi-unit residential and commercial mortgages expanded to $71.2 billion from $61.9 billion, reflecting strength in the institutional and securitisation side of the business.
Mortgage servicing income rose 6% year over year to $73.7 million, underpinned by the larger portfolio and growth in First National’s third-party underwriting operations. Its securitised mortgage portfolio increased 3% to $47.7 billion.
