Northpointe Bancshares, the parent of Michigan-based Northpointe Bank, plans to exit its distributed retail and consumer direct mortgage origination channels and sell them to CMG Financial and its affiliates. The bank announced the move with its third-quarter results on Oct. 20, 2026. The two companies have signed only a non-binding letter of intent. Northpointe said it expects the sale to close by the end of 2026, subject to due diligence, a definitive agreement and customary closing conditions.
The boards of the holding company and the bank approved the exit plan on Oct. 18, according to a Form 8-K dated Oct. 20. The filing cited “the current economic and operating environment and the continued evolution of mortgage distribution channels.”
Northpointe is not leaving mortgages. It will keep its Mortgage Purchase Program (MPP), its specialty servicing business and its digital banking business. Those, the company said, are where it has “the strongest competitive advantages.”
Why Northpointe is selling its mortgage channels
“Given today’s economic and operating environment, and the continued evolution of the mortgage distribution channels, we are refocusing our strategic priorities where we have the strongest competitive advantages,” Chairman and CEO Chuck Williams said in the release. He said the shift would let the bank “deepen client relationships, generate attractive portfolio assets, and grow relationship-based deposits.”
“We believe CMG would be a strong home for our origination team and a constructive path for our customers, referral partners and team members,” Williams said. “We remain highly committed to the mortgage banking industry.”
Neither the release nor the 8-K gave a price for the channels, the number of employees involved, or how many would move to CMG. Northpointe said it would share more on timing, restructuring charges, expense savings and the potential transaction on its Oct. 21 earnings call. The 8-K said the company will keep closing loans already in process and will support affected employees.
Restructuring cost of $6 million to $7 million
Northpointe estimates restructuring charges of $6 million to $7 million, most of it in the fourth quarter. According to the 8-K, the charges will consist mainly of cash spending on severance and employee transition costs. They also include an impairment charge of about $800,000 on the remaining intangible asset from an earlier acquisition of a mortgage team.
Northpointe’s quarterly mortgage volume fell. Residential mortgage originations dropped to $493.3 million in the third quarter, from $670.6 million in the second quarter and $636.6 million a year earlier. For the first nine months of the year, originations were still slightly ahead of 2025, at $1.86 billion compared with $1.79 billion. Interest rate lock commitments, an early indicator of future volume, fell to $570.4 million from $719.1 million in the prior quarter.
The bank’s net gain on sale of loans dropped to $2.2 million from $17.0 million in the second quarter. Excluding rate-driven fair value changes, the gain was $11.5 million, down $4.9 million. Northpointe attributed that decline to fewer residential rate lock commitments.
The wider market is also under pressure. The Mortgage Bankers Association recently cut its 2027 origination forecast to $1.99 trillion, with rates holding above 7%.
Northpointe’s third quarter
Northpointe reported third-quarter net income to common stockholders of $13.9 million, or $0.39 per diluted share. That compares with $21.3 million, or $0.60, in the second quarter and $20.1 million, or $0.57, a year earlier.
The release detailed the two items Williams cited. First, fair value declines driven by higher long-term interest rates reduced the value of loans held for investment and a lender risk account by $9.3 million combined, partly offset by a $5.0 million gain in the value of mortgage servicing rights. Second, the bank recorded $3.1 million in operating losses from what it called “an isolated external deposit fraud incident” at its retail banking center. Northpointe said it has notified its insurers and plans to pursue recoveries.
The businesses Northpointe is keeping grew. Mortgage Purchase Program balances rose $262.7 million in the quarter, a 27% annualized rate. Balances of its “All-in-One” first-lien home equity lines, which are tied to a deposit sweep account, grew $100.4 million, including a purchase of $85.4 million in seasoned loans on Sept. 30. Total assets reached $7.67 billion, and the board raised the quarterly dividend to $0.03 per share from $0.025.
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