Flagstar Bancorp Inc. in Troy, Mich., has reported first-quarter earnings of $7.8 million, down 59% from the year earlier. Diluted earnings per share were down 59%, to 12 cents 7 cents below the average of analysts' expectations in a Thomson Financial survey.
Flagstar said late Thursday that its profit fell because of lower net interest income, lower loan servicing income, and a reduction in the gain on sale of mortgage servicing rights.
Net interest income fell 20%, to $43.7 million. Net interest expense was up 27%, to $168.6 million. Flagstar's provision for loan losses rose 104%, to $8.3 million.
The increase was prompted primarily by a 29% increase in nonperforming loans, to $74.6 million. Noninterest income was down 6%, to $39.9 million. Noninterest expense was up 27%, to 71.4 million.
