EverBank Financial in Jacksonville, Fla. reported a decline in second-quarter earnings as loan servicing fees and loan production revenue plunged.
The $19.8 billion-asset company's net income fell more than 25% compared, to $32.3 million, from a year earlier while earnings per share dropped 26%, to 26 cents.
Noninterest income fell 39%, to $89.3 million, as net loan servicing income dropped roughly 51%, to $21.4 million. This decline was partly due to EverBank selling its default servicing unpaid principal balances to Green Tree Servicing in May. The company's gain on loan sales fell 37%, to $47.7 million, while loan production revenue fell almost 47%, to $5.3 million.
Net interest income declined almost 1%, to $140.2 million, as interest and dividends on investment securities fell more than 33%, to $9.8 million.
Total loans held for investment increased 19%, to $15.3 billion, as consumer loans, which include residential loans, home equity lines of credit and credit cards, were up 26%, to $8.5 billion, and commercial loans increased 11%, to $6.7 billion.
Residential loan originations fell 31%, to $2.2 billion, primarily due to a 49% decline in conventional loan originations. Commercial and commercial real estate loan originations also declined 16%, to $285 million. However, equipment financing receivables increased 113%, to roughly $400 million, bringing total commercial originations to$684 million, up 30% from a year earlier.
EverBank recorded a $2.1 million charge for regulatory and other expenses, the company said in a press release Wednesday. Excluding that charge, net income would have been $34.4 million, or 27 cents per share. Noninterest expense totaled $167.3 million, down almost 22% from a year earlier as salaries, commissions and other employee benefits dropped roughly 20%, to $95.3 million.
Total deposits increased 1%, to $13.9 billion, due to a 31% increase in time deposits.