Home-lending activity slowed at PennyMac Financial Services Inc. But the company reported growth in both its servicing and staffing.
In its fourth-quarter 2017 earnings report, the Westlake Village, California-based mortgage banking firm revealed $122 million pre-tax income.
Earnings improved from $94 million in the preceding three-month period thanks to a $32 million benefit from the Tax
Cuts and Jobs Act.
But pre-tax earnings were down
compared to $129 million during the same three months in 2016.
The latest quarter included $55 million in production income, down 20 percent from the third quarter. Servicing income, however, climbed 31 percent to $32 million.
Single-family loan originations totaled $17.038 billion during the three months ended Dec. 31, 2017 — including $1.642 billion in consumer-direct business and $15.396 billion in correspondent acquisitions. No volume was reported for the wholesale channel which opened last month.
Overall business slowed from $18.925 billion three months earlier and $22.077 billion one year earlier.
First-quarter 2018 production is likely to slip a little more based on total locks, which fell to $18.1 billion in the fourth-quarter from $19.6 billion the previous quarter.
PennyMac serviced $166.249 billion in loans for third parties as of year-end 2017. The servicing portfolio grew from $162.800 billion three months prior and $129.155 billion a year prior.
The number of loans serviced grew to 1,248,000 from 1,210,000 in the third quarter.
Correspondent market share for PennyMac, which reports 613 clients, dropped to 9.8 percent from
11.0 percent in the third quarter.
The report indicated that PennyMac reached an agreement to acquire mortgage-servicing rights on a portfolio of agency loans with an aggregate unpaid principal balance of $3.6 billion.
Delinquency of at least 60 days jumped to 3.5 percent from 2.5 percent as of Sept. 30
and 3.1 percent as of year-end 2016.
Headcount concluded last year at 3,248 people. Staffing grew from 3,142 employees at the end of the third quarter and 3,099 at the end of 2016.
