Key facts
- Large banks collectively saw mortgage volumes rise 20.8% quarter-over-quarter in Q2 2026.
- This growth significantly surpassed industry projections from the Mortgage Bankers Association and Fannie Mae.
- Wells Fargo, Truist, and Fifth Third reported substantial percentage increases in their mortgage volumes.
- Securitization data also suggests increased activity among banks in the agency mortgage market.
- Proposed changes to bank capital rules for mortgages may be influencing banks to increase their exposure.
Large banks collectively experienced a significant surge in mortgage volumes during the second quarter of 2026, growing by 20.8% quarter-over-quarter and 20.1% year-over-year. This performance far exceeded industry forecasts, with the Mortgage Bankers Association projecting a 3% gain and Fannie Mae forecasting 9% growth for the overall market.
According to analysts at Keefe, Bruyette & Woods (KBW), this trend suggests that depositary institutions may be recapturing market share from nonbank originators. The sampled banks, including JPMorgan Chase, Bank of America, Truist, PNC, Fifth Third, U.S. Bank, and Wells Fargo, reported a combined $56.1 billion in mortgage volume for the second quarter, up from $46.4 billion in the first quarter. Wells Fargo led the group with a 42.9% increase, while Truist and Fifth Third also posted strong growth. U.S. Bank was the sole exception, with a 7.6% sequential decline.
Agency securitization data further supports the notion of increased bank activity. Total agency issuance rose 11% quarter-over-quarter, with Ginnie Mae issuance up 20% and GSE issuance up 6%. While some large nonbanks like Rocket Companies and Rithm also saw growth, United Wholesale Mortgage and PennyMac experienced declines in their agency issuance.
KBW analysts noted that the stronger performance by banks could be linked to upcoming changes in capital rules for mortgage loans and mortgage servicing rights (MSRs). Proposed regulations may offer banks more flexibility by removing caps on MSRs and reducing risk weights on certain residential mortgages. However, the analysts cautioned that it is too early to determine if this indicates a permanent shift in how banks view mortgage exposure, and any significant increase in their role in the mortgage market is expected to take time.