Company: WFC-PC
Filing Date: 2025-04-29
Form Type: 10-Q
Source: 0000072971-25-000129
Chunk: 177

Company: WELLS FARGO & COMPANY/MN
Filing Date: 2025-04-29
Form: 10-Q
Item: Item 13
Chunk 177
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1,882 686 1,684 1,570 Net gains (losses) on sale— 11 — 21 Continuing involvement (3):Servicing rights recognized$24 11 16 10 Securities recognized (4)— — — — (1)In first quarter 2025, we sold the non-agency portion of our commercial mortgage third-party servicing business.(2)Represents cash proceeds and the fair value of non-cash beneficial interests recognized at securitization settlement.(3)Represents assets or liabilities recognized at securitization settlement date related to our continuing involvement in the transferred assets.(4)Represents debt securities obtained at securitization settlement held for investment purposes that are classified as available-for-sale or held-to-maturity. Excludes trading debt securities held temporarily for market-marking purposes, which are sold to third parties at or shortly after securitization settlement, of $531 million and $642 million during the quarters ended March 31, 2025 and 2024, respectively.In the normal course of business, we purchase certain non-agency securities at initial securitization or subsequently in the secondary market, which we hold for investment. We may also provide seller financing in the form of loans. During the quarters ended March 31, 2025 and 2024, for VIEs with significant continuing involvement, we received cash flows of $6 million and $158 million, respectively, related to principal and interest payments on these securities and loans. These amounts exclude cash flows related to trading activities.Table 13.2 presents the key weighted-average assumptions we used to initially measure residential MSRs recognized during the periods presented.Table 13.2:  Residential MSRs – Assumptions at Securitization Date20252024Quarter ended March 31,Prepayment rate (1)14.3 %17.3 Discount rate10.4 10.3 Cost to service ($ per loan)$62 265 (1)Includes a blend of prepayment speeds and expected defaults. Prepayment speeds are influenced by mortgage interest rates as well as our estimation of drivers of borrower behavior.See Note 12 (Fair Value Measurements) and Note 6 (Mortgage Banking Activities) for additional information on key assumptions for residential MSRs.RESECURITIZATION ACTIVITIES.  We enter into resecuritization transactions as part of our trading activities to accommodate the investment and