Mortgage News May 11, 2023
In recent news, Impac Mortgage is no longer suitable for listing on the NYSE American and has been delisted from the exchange immediately. The California-based lender’s common stock ticker symbol IMH is no longer tradable due to non-compliance with the required $2 million, $4 million, and $6 million stockholders’ equity. The NYSE American cited Section 1009 of the NYSE American Company Guide in its announcement.
Impac Mortgage recently shifted to a broker model and decided to wind down operations within its third-party origination (TPO) channel. The lender stated that a broker model would allow the company to provide various products at a reduced cost per loan. The decision was influenced by non-transitory inflation, Fed tightening, and widening credit spreads, which notably reduced Impac Mortgage’s addressable market for its product offerings. CEO George Mangiaracina said the excess industry origination capacity remained despite competitor consolidation and closures, as evidenced by participants’ pricing to decreased net margins in pursuit of market share.
While Impac Mortgage will no longer accept new loan submissions or broker applications, the lender has committed to honoring its pipeline and related obligations and commitments to its consumer and business partners. Impac Mortgage’s exit from the TPO channel is a significant shift and aligns with similar trends in the market. The industry’s excess origination capacity has created intense competition, with many lenders offering lower net margins to gain a greater market share. Ultimately, Impac Mortgage’s decision to transition to a broker model could be a strategic move that will enable the California-based lender to become more efficient and competitive in the long term.
The delisting of Impac Mortgage’s common stock from the NYSE American and the lender’s shift to a broker model demonstrates the challenges that lenders face in a competitive market environment where interest rates, credit spreads, and inflation can all impact profitability.
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