Impac suffers a loss of $12M in the fourth quarter

Impac Mortgage Holdings suffered a smaller quarter-to-quarter loss than it did in the quarter ended Dec. 31. However, originations were still down as the company cut back its operations. In his opening statement to the earnings call, George Mangiaracina (chairman and CEO) stated that despite competitor consolidation and closings, there is still excess industry origination capacity. The company does not intend to engage in systematic, non-economical activities. “The company has no intention of engaging in systematic, non-economic activities. Justin Moisio chief administrative officer stated that, “From an expense management standpoint, we continue to adjust marketing spend to calibrate for a reduced loan officer staff as well as the decline in lead quality of borrowers wanting to transact and shrinking addressable markets at these rate levels.” “Our business promotion expense fell to $261,000 in quarter four, a 52% decrease over the previous quarter and an 88% (or $2 million) decrease over the quarter last year. The fourth quarter’s net gain on sale was $865,000, which is a 52% decrease from the prior quarter and an 88% or $2 million decrease from the fourth quarter of last year. This compares to a loss of $682,000. The net gain on sale for all of 2022 was $6.3 million, a significant decrease from the $65.3 million in 2021. Gloeckner stated that the net gain on sale for all of 2022 was $6.3 million, well below the $65.3 million in 2021. Gloeckner said that the company still has $16 million in warehouse capacity with one counterparty. Impac is a broker and does not need to self-fund originations. It has a cash position of $26million plus $9.4million of unencumbered loans. Gloeckner stated that the company applied for $7.3 million in employee retention credit as part of the CARES Act. This credit is expected to be received by 2023. “Based on our current cash position and borrowing resources, as well as our defensive posture, we believe we have the liquidity required to meet our immediate production needs.”