Willamette Valley Is The Latest Bank To Step Away From Residential Mortgages

Salem, Oregon-based Willamette Valley Bank is exiting the residential mortgage lending business, citing intense competition and a prolonged high interest rate environment. The bank announced Thursday that its mortgage operations will cease on March 31.

President and CEO Ryan Dempster said the residential mortgage industry has undergone significant changes in recent years, including the rise of online and nonbank lenders and an extended period of elevated interest rates.

“These conditions have made it increasingly difficult for community financial institutions to compete sustainably in this segment,” Dempster said in a statement. “We remain focused on commercial banking and continue serving the core needs of businesses and individuals throughout the Willamette Valley.”

Willamette originated approximately $233 million in mortgages over the past 12 months, down sharply from $460 million in 2023, according to mortgage technology platform RETR. The bulk of its production consisted of conventional and purchase loans.

Data from the Nationwide Multistate Licensing System (NMLS) shows the bank had 13 sponsored loan officers as of Thursday. RETR data indicates that 39 loan officers departed the company over the past year.

The move comes amid a broader pullback by banks from mortgage originations.

In October 2025, Puerto Rico-based Popular Bank  exited the business as part of a profitability strategy that included the closure of four underperforming branches in the New York metro area, according to chief financial officer Jorge Garcia.

A month before that, OceanFirst Bank also stepped away from mortgage originations, opting instead to partner with Embrace Home Loans to continue offering financing solutions to customers.

Jill Hewitt, senior vice president and director of corporate communications and marketing at OceanFirst, said the mortgage segment has been “dominated in recent years by large-scale wholesale mortgage companies and financial technology firms,” prompting many banks to reassess their business models.

Embrace has also entered into a partnership with New York-based Amalgamated Bank. Meanwhile, Philadelphia-based Firstrust Bank has partnered with MortgageCountry LLC. Under the arrangement, loans will be originated and closed under Firstrust’s name, and the bank will retain its loan officers as employees. MortgageCountry will oversee production along with providing leadership support and a technology platform.