Among banks and thrifts, it is no secret that higher interest rates will weigh on loan production and refinancing volumes.
Looking forward, Mr Blankfein said: "We believe that we are well positioned to generate solid returns as the economy continues to heal and provide considerable upside for our shareholders as conditions materially improve". Citigroup saw its overall revenues fall 2% to $17.9bn for the fourth quarter, due in part to a decline in mortgage loan refinancing volumes.
That, in turn, will give mortgage lenders an incentive "to broaden loan eligibility requirements, as refinance volume is likely to dry up".
Meanwhile, the purchase index decreased 11.2percentt from a week earlier and was 13.9percentt lower than the same week last year...Survey participants said about 32percentt of this refinance volume was for Home Affordable Refinance Program HARPP) loans.
New mortgage and refinancing loan volumes fell nearly 19 percent, to $265 billion, at the end of the second quarter, down from $325 billion in the first quarter, the lowest since 2008, according to Inside Mortgage Finance, an industry newsletter.
"Refinance application volume jumped to the highest level in more than three years last week as each of the five mortgage rates in the M.B.A.'s dropped to new record lows in the survey," Mike Fratantoni, the association's vice president of research and economics, said in a prepared statement.
Nationwide, FMLP and 504 refinance loan volume confirms a healthy demand for these loans.
"Refinance application volume dropped sharply this week as mortgage rates held near six month highs," Michael Fratantoni, MBA's Vice President of Research and Economics, said in a statement.
The total dollar volume of refinancing activity in 2009 will be about $1 trillion.
