{"id":58356,"date":"2024-08-09T03:03:47","date_gmt":"2024-08-09T01:03:47","guid":{"rendered":"https:\/\/housesmarketplace.com\/longbridge-parent-lauds-reverse-lenders-contribution-in-q2\/"},"modified":"2024-08-09T03:03:47","modified_gmt":"2024-08-09T01:03:47","slug":"longbridge-parent-lauds-reverse-lenders-contribution-in-q2","status":"publish","type":"post","link":"https:\/\/housesmarketplace.trio-tv.com\/ru\/longbridge-parent-lauds-reverse-lenders-contribution-in-q2\/","title":{"rendered":"\u041c\u0430\u0442\u0435\u0440\u0438\u043d\u0441\u043a\u0430\u044f \u043a\u043e\u043c\u043f\u0430\u043d\u0438\u044f Longbridge \u0445\u0432\u0430\u043b\u0438\u0442 \u0432\u043a\u043b\u0430\u0434 \u043e\u0431\u0440\u0430\u0442\u043d\u043e\u0433\u043e \u043a\u0440\u0435\u0434\u0438\u0442\u043e\u0440\u0430 \u0432\u043e \u0432\u0442\u043e\u0440\u043e\u043c \u043a\u0432\u0430\u0440\u0442\u0430\u043b\u0435"},"content":{"rendered":"
\n

Following the slight loss contributed by Longbridge Financial<\/strong><\/a> to the first-quarter earnings of parent company Ellington Financial<\/strong><\/a>, the reverse mortgage lender turned its fortunes around in the second quarter, which led to praise from the Ellington executive team in a Q2 2024 earnings report released this week.<\/p>\n

Ellington reported net income contributable to common stockholders of $52.3 million, and $69.1 million from its investment portfolio. Longbridge contributed $4.2 million to the total.<\/p>\n

Ellington CEO Laurence Penn praised Longbridge in both an earnings release and on a call with investors that delved into the details of the Q2 report.<\/p>\n

Longbridge performance<\/h2>\n

Ellington reported that Longbridge\u2019s positive contribution in the second quarter was primarily driven by net interest income and net gains on the company\u2019s proprietary reverse mortgage products, branded as \u201cPlatinum.\u201d<\/p>\n

Longbridge is also a top 10 lender of Federal Housing Administration<\/strong><\/a> (FHA)-insured Home Equity Conversion Mortgages (HECMs). While the company did have a higher HECM loan volume in Q2 2024, this was \u201cmostly offset by a decline in gain-on-sale margins, driven by wider yield spreads on newly originated [HECM-backed Securities (HMBS)],\u201d the company said. <\/p>\n

\u201cIn servicing, tighter yield spreads on more seasoned HMBS led to improved execution on tail securitizations, which contributed to the positive results from servicing.\u201d<\/p>\n

Overall, the Longbridge portfolio increased by 18% to $520.8 million when excluding \u201cnon-retained tranches of a consolidated securitization trust,\u201d the company added. This was largely tied to proprietary loan originations, typically geared for higher-value homes with loan limits of up to $4 million. Proprietary loans from Longbridge are also available to borrowers as young as 55 in certain states.<\/p>\n

Across its retail, wholesale and correspondent channels, Longbridge originated 1,706 loans for a total of $304.5 million in Q2 2024, which includes its proprietary loans. Of the total volume, 20% came from its retail channel.<\/p>\n

Leadership response<\/h2>\n

Penn praised Longbridge\u2019s performance.<\/p>\n

\u201cDriven by broad-based contributions from our diversified credit and agency portfolios, as well as from our reverse mortgage platform, Longbridge, Ellington Financial generated a nonannualized economic return of 4.5% for the second quarter, and grew adjusted distributable earnings and book value per share sequentially,\u201d he said.<\/p>\n

Penn added that Ellington saw positive performance in its nonqualified mortgage (non-QM<\/a>) business, and he went on to describe Longbridge\u2019s contribution to the company as \u201crobust\u201d due to proprietary loan performance.<\/p>\n

\u201cFollowing quarter end, we successfully completed our second securitization<\/a> of proprietary reverse mortgage loans originated by Longbridge, achieving incrementally stronger execution than our inaugural deal in the first quarter,\u201d Penn added. \u201cOur second-quarter results also significantly benefited from the performance of our residential transition and commercial mortgage loan strategies, as well as non-agency RMBS.\u201d<\/p>\n

Penn mentioned in the Q1 earnings call<\/a> that the company expected Longbridge\u2019s performance to improve in Q2, which came to fruition. <\/p>\n

\u201cOn last quarter\u2019s earnings call, we predicted a second-quarter turnaround at Longbridge, and Longbridge did a great job and delivered both on a GAAP basis and [adjusted distributable earnings (ADE)] basis,\u201d he said. \u201cLongbridge is an important part of [our] ADE momentum.\u201d\u00a0<\/p>\n

J.R. Herlihy, Ellington\u2019s chief financial officer, noted that \u201cLongbridge [\u2026] contributed $0.06 per share to our ADE, in contrast to its negative $0.01 per share contribution last quarter,\u201d and credited Longbridge\u2019s contribution with an overall increase in the full company\u2019s ADE.<\/p>\n

Looking ahead<\/h2>\n

Penn said that the work for Longbridge is trending in a positive direction based on loan volumes and projections for mortgage rates<\/a>.<\/p>\n

\u201cAt Longbridge, we have more work to do to grow origination volumes further, but the positive developments in the prop[rietary] reverse securitization markets and a strong July in originations should bode well for Longbridge going forward,\u201d he said. <\/p>\n

\u201cLower long-term interest rates could also provide a big boost to Longbridge\u2019s origination business, since the size of the loans that borrowers are able to take out generally increases as long-term interest rates decline.\u201d<\/p>\n

Loan size, more than interest rates, Penn said, stands as the key driver of reverse mortgage origination volume.<\/p>\n<\/div>\n","protected":false},"excerpt":{"rendered":"

Following the slight loss contributed by Longbridge Financial to the first-quarter earnings of parent company Ellington Financial, the reverse mortgage lender turned its fortunes around in the second quarter, which led to praise from the Ellington executive team in a Q2 2024 earnings report released this week. Ellington reported net income contributable to common stockholders […]<\/p>\n","protected":false},"author":1,"featured_media":0,"comment_status":"closed","ping_status":"closed","sticky":false,"template":"","format":"standard","meta":{"footnotes":""},"categories":[1],"tags":[],"class_list":["post-58356","post","type-post","status-publish","format-standard","hentry","category-uncategorized"],"yoast_head":"\nLongbridge parent lauds reverse lender\u2019s contribution in Q2 - Houses Marketplace<\/title>\n<meta name=\"robots\" content=\"index, follow, max-snippet:-1, max-image-preview:large, max-video-preview:-1\" \/>\n<link rel=\"canonical\" href=\"https:\/\/housesmarketplace.trio-tv.com\/ru\/longbridge-parent-lauds-reverse-lenders-contribution-in-q2\/\" \/>\n<meta property=\"og:locale\" content=\"ru_RU\" \/>\n<meta property=\"og:type\" content=\"article\" \/>\n<meta property=\"og:title\" content=\"Longbridge parent lauds reverse lender\u2019s contribution in Q2 - Houses Marketplace\" \/>\n<meta property=\"og:description\" content=\"Following the slight loss contributed by Longbridge Financial to the first-quarter earnings of parent company Ellington Financial, the reverse mortgage lender turned its fortunes around in the second quarter, which led to praise from the Ellington executive team in a Q2 2024 earnings report released this week. 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