Quarterly home loan production surpassed prior period totals at PennyMac Financial Services Inc. A new wholesale lending channel is planned.
Pretax income from April 1 to June 30 totaled $84 million, well above the $30 million earned during the previous period and the highest on record.
The Moorpark, California-based entity revealed this total and other operational and financial results through its second-quarter 2016 earnings data.
The company’s recent income also fared better on a year-over-year basis, with just $75 million brought in during the second quarter of last year.
The financial services provider closed $16.109 billion in residential loans in the second-quarter 2016.
Mortgage closings leapt past the $10.890 billion funded in the first three months of 2016.
Home loan production also increased from the second-quarter 2015, when $13.033 billion was originated.
“Volumes in the mortgage origination market have increased in reaction to lower rates,” PennyMac Chairman and Chief Executive Officer Stanford L. Kurland said in the company’s earnings statement. “However, industry capacity constraints are moderating the growth in market volumes and should contribute to a prolonged period of elevated origination volumes and margins.”
Correspondent acquisitions, which grew 51 percent from the first quarter, comprised $14.607 billion of the latest mortgage production total. The remaining $1.501 billion came from the consumer-direct channel, which saw a quarter-over-quarter gain of 24 percent.
The mortgage firm is expected to launch its wholesale lending program in mid-2017.
For the first six months this year, PennyMac funding volume amounted to $26.999 billion.
Third-quarter home lending will likely out pace second-quarter originations based on the mortgage provider’s total locks. For the most-recent period, total locks were $18.9 billion, $6.3 billion above the first three months of 2016.
At the end of June 2016, PennyMac accounted for 457 correspondent seller relationships or 20 more than claimed at the end of the first quarter.
The residential loan servicing portfolio fattened to $117.037 billion at the end of June from $112.837 billion at the end of March and $90.681 billion at the same point a year ago.
PennyMac also accounted for an additional $48.895 billion in sub-servicing as of mid-year 2016.
The earnings report revealed the firm produced a letter of intent to take on mortgage servicing rights for nearly $1 billion in defaulted government loans from a large bank.
The 60-day delinquency rate dropped to 2.5 percent from 2.6 percent as of March 31.
At the end of June, PennyMac counted over 2,600 employees — 100 more than the first-quarter end count.
Staffing numbers were also increased over the 2,354 employees accounted for at the same point in 2015.
