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Record Earnings, Mortgage Originations at PennyMac

PennyMac Financial Services Inc. reported an all-time high for earnings. In addition, quarterly residential loan originations were the highest on record.

From July 1 through Sept. 30 of this year, pre-tax income came to $139 million — the most ever earned by PennyMac. Income was $74 million a year earlier.

That data and other operational and financial metrics were included in
the Westlake Village, California-based company’s third-quarter earnings report.

In the second quarter of this year, earnings came to $84 million.

“We have been able to capitalize on the strong origination market and the unique ability of our platform to scale up quickly and efficiently to generate strong volumes amid continuing low interest rates,” PennyMac Chairman and Chief Executive Officer Stanford L. Kurland stated in the report.

Mortgage originations totaled a record $20.597 billion during the latest three-month period. Business improved from $16.109 billion in the second quarter and $15.464 billion in the third-quarter 2015.

For all three quarters that have completed so far this year, volume came to $47.596 billion.

Third-quarter 2016 production included $1.677 billion in consumer-direct originations and $18.920 billion in correspondent acquisitions.

Current-quarter originations are likely headed even higher based on total locks, with climbed to $25.0 billion in the third quarter from $18.9 billion the prior period.

PennyMac noted that there is “significant opportunity in conventional conforming market for continued share growth.”

September 2016 ended with 504 correspondent relationships, 47 more than at mid-year.

Refinance share was a third, widening from 29 percent in the second quarter.

PennyMac serviced $121.313 billion in home loans as of the end of September 2016. The primary servicing portfolio expanded from $117.037 billion three months earlier and $106.977 billion one year earlier.

An additional $56.100 billion in mortgages were subserviced as of the most-recent date.

The report indicated that a total of 939,000 loans were serviced at the end of the third-quarter 2016.

Delinquency of at least 60 days climbed to 2.9 percent from 2.5 percent as of June 30, 2016.

There were in excess of 2,900 people on PennyMac’s payroll as of the end of September. Headcount
increased by 300 employees compared to the prior period and by 417 employees versus a year prior.

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