Westlake Village’s nonbank mortgage lender PennyMac Financial Services Inc. reported third-quarter earnings above Wall Street expectations and anticipates minimal losses from hurricanes and wildfires, the company announced Thursday.
The lender reported net income of $82.5 million (71 cents a share) on revenue of $251 million, compared to net income of $122 million ($1.06) on revenue of $291 million for the same year-ago period. Despite falling below its prior quarterly revenue and earnings, PennyMac exceeded analysts’ estimated 70 cents a share in earnings and $247 million anticipated revenue, according to Thomson Financial Network.
“We continued to grow market share in both our correspondent and consumer direct channels and we look forward to the rollout of our new broker direct channel,” said Chief Executive David Spector. He also said that the company’s servicing portfolio experienced substantial growth to now service more than 2 percent of all mortgages outstanding in the U.S.
PennyMac Executive Chairman Stanford Kurland described the company’s new Broker POWER technology platform that will give it entrance into the broker direct channel as well as access to another 10 percent of the mortgage origination market.
PennyMac also said about 11 percent of its servicing portfolio is in areas impacted by Hurricanes Harvey and Irma and recent California wildfires. As a result, it expects to have to raise loan servicing costs over the next few quarters to handle loan payment delinquencies by affected borrowers and incremental losses on defaulted government loans. Overall, it expects a modest financial impact.
Shares in PennyMac Financial Services (PFSI) closed Thursday down 30 cents, or 1.6 percent, to $18.40 on the New York Stock Exchange.