Without any significant marketing plans or aggressive sales campaigns, Norwest Mortgage Inc., a $45.5 billion bank holding company, somehow has leapfrogged four of its toughest competitors to become the single biggest originator of Ginnie Mae issuances with $10.2 billion worth, outpacing its closest competitor by more than $6 billion so far this year.
What makes that figure so amazing is that the Des Moines, Iowa-based company's total originations for all of 1992 were a mere $3.1 billion, according to the Mortgage Marketplace's Ginnie Mae Top 100 list.
Those figures may seem skewed, however, said Dave Boberg, vice president of secondary marketing at Norwest, because last year it sold loans through Barclays American Mortgage Co. of Charlotte, N.C., as part of Ginnie Mae's concurrent issuance program.
As a result, Barclays looked extremely good and chimed in as the No. 2 Ginnie Mae issuer last year with $6.2 billion worth of originations. Norwest, however, was still No. 5 with $1.2 billion. But things changed in this year when Norwest, which Paine Webber projects will report 1993 earnings of more than $419 million, opted out of the Ginnie-sponsored program and Barclays has since fallen from the Top 100.
Norwest, now claiming all of its originations, is riding high at No. 1.
But even with originations reaching record proportions, Boberg says Norwest didn't create special marketing programs to spur the increase. It did add 50 branches to increase its total to 595 nationwide and has 550 correspondents completing originations and servicings. The company planned to do about $20 billion in loan production in 1993, but Boberg said that figure will top $30 billion.
"We have a larger branch network than most other mortgage companies," Boberg said. "We cater to the purchase market and we also buy a lot of FHA and VA loans through correspondence companies. "He said that Norwest was also attracting a lot of volume by paying competitive servicing release fees.
Boberg cited the company's success in producing adjustable-rate mortgages as another reason for its success this year. Participation from Wall Street in buying Ginnie Mae ARM products also helped, he added.
Fannie Mae and Freddie Mac, when combined, make up a larger portion of Norwest's actual business - a little more than the $10.3 billion in Ginnie originations - but with the higher Ginnie originations also comes the risk factor.
"I think we have a somewhat higher delinquency rate," Boberg said. "But we still look at total servicing, basis points, servicing we can obtain, and we try to quantify all those points and factor them all into our pricing. We've never had a specific goal to reach with regard to FHAs, VAs or conventionals. We just go out there and give the best price we can."
