This article is being republished as part of our daily reproduction of WSJ.com articles that also appeared in the U.S. print edition of The Wall Street Journal (January 30, 2018).
Wells Fargo & Co. said Michael DeVito will lead its mortgage division, after assuming the role on an interim basis following an executive shake-up in late 2017.
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His permanent elevation to the top mortgage spot comes at a difficult time for the division and the broader mortgage market. As interest rates have climbed in recent months, lenders' refinancing businesses are slowing, crimping profits in a crucial part of the business. Meanwhile, some analysts have expressed concern over the new tax law's impact on some parts of the housing market.
Mr. DeVito, who earlier led mortgage production for the bank, took over the home-lending division after the bank's now-former head of mortgage and auto Franklin Codel was fired for making disparaging comments about regulators, The Wall Street Journal reported.
Mr. DeVito takes the lead of the largest mortgage lender by volume. He will continue reporting to Mary Mack, who was named head of the consumer lending unit in December, following Mr. Codel's departure. That is in addition to her responsibilities leading Wells Fargo's retail bank.
Mr. DeVito has held several executive roles at Wells Fargo or its predecessor banks over the past 22 years and has served on the bank's home mortgage executive management team since 2011.
Wells Fargo's mortgage business earned $928 million in fees in the fourth quarter, down 35% from the $1.42 billion it earned in same period a year ago.
And Wells Fargo's originations business isn't faring much better. Wells Fargo's retail mortgage loans fell to $23 billion in the fourth quarter, down from $35 billion a year earlier. And its correspondent mortgage loans were $30 billion in the fourth quarter, down from $36 billion a year ago.
Meanwhile, Wells Fargo has said it charged some customers improper fees to extend the interest-rate commitments they received from Wells Fargo on their mortgage applications. In October, the bank said it is reaching out to around 110,000 customers who paid a total of $98 million in such fees, and expects refunds to be lower than that total because, the bank said, it "believes a substantial number of those fees were appropriately charged under its policy."
A few months prior, the bank fired some top executives in its mortgage retail sales group related to those problems.
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(END) Dow Jones Newswires
January 30, 2018 02:47 ET (07:47 GMT)
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