Wells Fargo & Co. (WFC), one of the leading mortgage companies in the US, has surpassed its market share record due to cutbacks by its competitors, and not because of its own actions, according to Scott Simon, Mortgage-debt Head of California-based Pacific Investment Management Co.
“It’s not Wells Fargo’s fault they got so big,” said Simon.
According to Inside Mortgage Finance, WFC accounted for 33.9 percent of the US$385 billion (S$480 billion) of mortgages in Q1 2012, an increase from 30.1 percent in the previous quarter.
It added that WFC’s market share is more than triple the share of JPMorgan Chase & Co., its closest rival at 10.6 percent.
Meanwhile, Bank of America Corp, the previous market leader whose share dropped to 4.2 percent, has recovered after losses and lawsuits caused by flawed mortgage lending and servicing.
“If Wells Fargo went back to 20 percent, tried to cut themselves back more, it’d be hugely restrictive on credit,” noted Simon.
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