The wholesale mortgage division of Coastal Banking Company (CBCO) reached the $1bn milestone for loan production. The Atlanta-based lending division started originating loans in September 2007 as the bank shifted its strategy away from commercial real estate loans and increased focus on single- and multi-family residential mortgages. CBCO operates the Beaufort, S.C.-based Lowcountry National Bank and the Fernandina Beach, Fla.-based First National Bank of Nassau County. The bank’s mortgages are full-documentation, conforming loans and most are pre-sold to the secondary market. The bank also holds $38m in its portfolio. “[W]e entered the wholesale mortgage industry at a time when many mortgage lenders were exiting the business, leaving a gap in service,” said Charles Wagner, senior vice president of CBC National Bank’s wholesale division, in a statement. “In addition, we were able to create the division with nominal operational costs and free of the risk exposure that was troubling much of the industry due to past liberal lending practices. Our growth to date has far exceeded our expectations, and the division has been a significant contributor to CBC National Bank’s earnings.” The bank received of funds from the Treasury Department‘s Troubled Asset Relief Program (TARP) Capital Purchase Program, which it said allowed it to double its level of wholesale lending during the first six months after receiving the funds compared to the prior six-month period. Last year, the bank obtained approval to originate Federal Housing Administration (FHA) insured loans, which now make up one-third of its total loan volume. It currently originates more than $81m in mortgages every month and said it plans to expand its mortgage business in Georgia, South Carolina and north Florida. Write to Austin Kilgore.

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