) -- Big banks made a killing on financing mortgages last year, but they're unlikely to build off of that tremendous growth in 2010.

Mortgage-related profits more than tripled from the previous year, according to a survey released by an industry group on Tuesday. The average profit per loan was $1,135 in 2009, vs. $305 in 2008. Loans originated by banks and thrifts were 44% more profitable than those originated by independent companies, according to the Mortgage Bankers Association.

It's no surprise, but something of an ironic footnote to the Great Recession: Thanks largely to the federal bailouts, banks survived and their funding costs fell to nearly zero. Thanks largely to federal housing initiatives, the costs of mortgage production plunged and demand grew dramatically, sending origination volumes through the roof.

As a result, profit margins climbed from the very business that led the country into a downturn. And those that received some of the largest bank bailouts had a great advantage over smaller, independent peers because their mortgage-finance subsidiaries are so huge.

For instance,

Bank of America's

(BAC) - Get Report

mortgage profits -- before credit expenses -- nearly doubled from 2008.

Wells Fargo's

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were 4.7 times as high. The average firm posted pre-tax, pre-provision profits $4.9 million, seven times as high as 2008, and 96% of those surveyed were profitable, vs. just 59% the previous year.

"Production profits increased in 2009 over 2008 as higher origination volumes, particularly in refinancing, reduced per-loan production expenses," Marina Walsh, MBA's associate vice president of industry analysis, said in a statement. "It was also clear bank and thrift subsidiaries had an advantage over independent mortgage companies because of lower loan officer compensation per loan and higher net interest spread due to lower warehouse funding costs and the ability to keep loans in warehouse longer."

However, originations have tapered off because the climb was driven by incentives and desperation. Homeowners who most needed assistance either rushed to participate in the federal workout program early, entered a private workout with the bank, or resorted to less-desirable solutions such as deed-in-lieu, a short-sale, or an outright foreclosure, if they were truly in over their heads.

Financially stable borrowers seeking mortgage loans or refinancing tend to be more cautious and selective. The expiration of a federal tax credit in April has only pushed down demand from first-time homebuyers and others who were helping to prop up what critics call "artificial" demand.

Existing home sales dropped 2.2% in May, following April's tax-credit-related surge. New home sales plunged an even more dramatic 33%.

Meanwhile, prices remain under pressure -- apart from April's skewed results -- with the MBA predicting further declines through 2012. Mortgage rates have fallen to a record low of 4.69%, again, with the help of the government, via

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Federal Reserve

rate policies and the mortgage-buying spree of

Fannie Mae


Freddie Mac

. But buyers and refinancers still can't be wooed to the table.

In the first quarter, big banks reported mortgage-banking results that didn't impress the market -- perhaps because of the

surprising mega-profits a year ago.

JPMorgan Chase

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was the

first to unveil results, which investors considered lackluster, on April 14.

Bank of America and

Wells Fargo followed suit. The mortgage-servicing titans all beat estimates, but the bottom line was no match for credit concerns and other industry woes: Bank stocks have dropped roughly 15% since that time.

Investors may want to take note that the mortgage sector is coming under renewed pressure, and set second-quarter expectations accordingly.

-- Written by Lauren Tara LaCapra in New York