PennyMac Financial Services, Inc. (NYSE:PFSI) Q4 2024 Earnings Conference Call January 30, 2025 5:00 PM ET

Company Participants

David Spector - Chairman and CEO
Dan Perotti - Chief Financial Officer

Conference Call Participants

Doug Harter - UBS
Michael Kaye - Wells Fargo
Terry Ma - Barclays
Crispin Love - Piper Sandler
Mark DeVries - Deutsche Bank
Ryan Shelley - Bank of America
Derek Sommers - Jefferies
Bose George - KBW

Operator

Good afternoon. And welcome to PennyMac Financial Services, Inc. Fourth Quarter 2024 Earnings Call. Additional earnings materials, including presentation slides that will be referred to in this call, are available on PennyMac Financial’s website at pfsi.pennymac.com.

Before we begin, let me remind you that this call may contain forward-looking statements that are subject to certain risks identified on Slide 2 of the earnings presentation that could cause the company’s actual results to differ materially, as well as non-GAAP measures that have been reconciled that are GAAP equivalent in the earnings materials.

Now, I’d like to introduce David Spector, PennyMac Financial’s Chairman and Chief Executive Officer; and Dan Perotti, PennyMac Financial’s Chief Financial Officer. You may begin.

David Spector

Thank you, Operator. Good afternoon and thank you to everyone for participating in our fourth quarter earnings call. For the fourth quarter, PFSI reported net income of $104 million or diluted earnings per share of $1.95 for an annualized return on equity of 11%. Excluding the impact of fair value changes, PFSI produced an annualized operating ROE of 16%, driven by continued strength in our Servicing business and a solid contribution from our Production segment, despite higher mortgage rates.

In total, loan originations and acquisitions were $36 billion in unpaid principal balance, up 13% from the prior quarter and driving the continued growth of our Servicing portfolio to $666 billion in unpaid principal balance with 2.6