Company: MCHB
Filing Date: 2025-05-08
Form Type: 10-Q
Source: 0001518715-25-000083
Chunk: 74

Company: Mechanics Bancorp
Filing Date: 2025-05-08
Form: 10-Q
Item: Item 8
Chunk 74
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 on sale of $990 million of multifamily loans.  

Loan servicing income, a component of noninterest income, consisted of the following: 

 Quarter Ended(in thousands)March 31, 2025December 31, 2024Single family servicing income, netServicing fees and other$3,725 $3,715 Changes - amortization (1)(1,582)(1,690)Net2,143 2,025 Risk management, single family MSRs:Changes in fair value due to assumptions (2)271 2,559 Net gain (loss) from economic hedging (3)1,016 (2,731)Subtotal1,287 (172)Single Family servicing income 3,430 1,853 Commercial loan servicing income:Servicing fees and other2,782 2,472 Amortization of capitalized MSRs(1,354)(1,328)Total1,428 1,144 Total loan servicing income $4,858 $2,997 

(1)Represents changes due to collection/realization of expected cash flows and curtailments.

(2)Principally reflects changes in model assumptions, including prepayment speed assumptions, which are primarily affected by changes in mortgage interest rates. 

(3)The interest income from US Treasury notes securities used for hedging purposes, which is included in interest income on the consolidated income statements, was $0.4 million and $0.3 million for the quarters ended March 31, 2025 and December 31, 2024, respectively.

Noninterest income in the first quarter of 2025 increased from the fourth quarter of 2024 primarily due to the $88.8 million loss on the sale of multifamily loans in the fourth quarter of 2024 and an increase in loan servicing income. The increase in loan servicing income is primarily due to an increase in the value of our single family mortgage servicing rights.

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Noninterest Expense consisted of the following:

 Quarter Ended(in thousands)March 31, 2025December 31, 2024Noninterest expenseCompensation and benefits$26,309 $25,037 Information services7,585 7,208 Occupancy4,871 6,181 General, administrative and other10,343 5,527 Total noninterest expense$49,108 $43,953 

Noninterest expenses were $5.2