Flagstar Bancorp, Inc., Flagstar Bank’s parent company based in Michigan, has reduced its mortgage staff by 20% since the calendar turned to 2022, laying off 420 employees amid a significant drop in origination volumes and margins.

Overall, the bank’s net income fell 60.4 percent from the previous quarter to $53 million in the first quarter of 2022. Mortgage revenue fell $36 million from January to March, falling to $74 million.

“Gain on sale revenue was under significant pressure throughout the quarter as the velocity of the increase in mortgage rates rose at the fastest rate this century,” Flagstar Bancorp president and CEO Alessandro DiNello said in a statement.

Flagstar Bancorp reported on Wednesday that mortgage loans closed in the first quarter totaled $8.2 billion. Which is down 23% quarter-over-quarter.

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