PennyMac Posts Profitable Q2 2024 Earnings

PennyMac Financial Services, Inc. (PFSI) yesterday reported net income of $98.3 million for the second quarter of 2024, or $1.85 per share on a diluted basis, on revenue of $406.1 million. Book value per share increased to $71.76 from $70.13 on March 31, 2024.

Pretax income was $133.9 million, up from $43.9 million in the prior quarter and $72.9 million during the second quarter of 2023

The second quarter profit was more than double the $39.3 million generated during Q1 2024. The California-based lender reported production revenue of $202.6 million from April to June, marking a 10% increase from the previous quarter and a 19% rise from the second quarter of 2023.

This revenue boost led to increased income for its loan production channel, which reached $41.3 million in Q2 2024, up from $35.9 million in Q1 2024 and $24.4 million in Q2 2023.

“PennyMac Financial generated strong earnings in the second quarter with an annualized operating return on equity of 16%,” said Chairman and CEO David Spector in the company's press release. “Given our continued strong financial results, I am pleased to note that PFSI’s Board of Directors approved a quarterly common cash dividend of $0.30 per share from $0.20 per share, an increase of 50%."

Spector also added that total acquisition and origination volumes were $27 billion, up 25% from the prior quarter, which drove "continued growth of our servicing portfolio to more than $630 billion in unpaid principal balance at quarter-end.”

Spector continued, "While our financial performance in recent periods has been strong, I continue to believe PennyMac’s best days are yet ahead. This quarter we successfully raised $650 million in unsecured senior notes at attractive terms, further strengthening our balance sheet and demonstrating our strong access to capital and liquidity. In this higher interest rate environment, we have gained considerable market share...we remain one of the best-positioned in the industry to drive continued growth and financial returns.”