The fate of Wells Fargo & Co.’s mortgage business has been the subject of industry speculation in the wake of a Bloomberg report indicating that the lending giant plans to shrink its enormous mortgage footprint, including a likely pull-back from the correspondent lending business.

Shortly after that story went live, analysts at Keefe, Bruyette & Woods(KBW) published a report stating that if Wells does exit the correspondent lending market, it “would meaningfully reduce the company’s servicing portfolio, since that channel is primarily a source of mortgage servicing rights (MSRs).”

“We estimate that around 10% of [Wells Fargo’s] service volume is Ginnie details ⇒