PennyMac Financial Services more than tripled its net income over the course of a year when it reported $535.2 million, or $7.03 per share, in its third quarter financial report, up from $121.5 million, or $1.51 per share, in the third quarter of 2019.
The Westlake Village-based mortgage lender built on steam from a record second quarter, which produced high income from loan production and servicing, and also issued $500 million of 5.375% senior unsecured notes and repurchased almost 120,000 shares of common stock for nearly $7 million.
Servicing segment pretax income also rose sharply. In the third quarter it was $111.7 million, compared to $18.1 million a year prior.
The company has hired to keep up with the additional demand, and now has more than 6,000 PennyMac employees across the country.
“PennyMac Financial again delivered record earnings in the third quarter, driven by increases in income from both our production and servicing segments,” said president and CEO David Spector in the company’s Nov. 5 earnings release. “Record production income resulted from outstanding performance across all channels and continued growth in our higher-margin consumer and broker direct lending channels.”
PennyMac’s board of directors announced a third quarter cash dividend of $0.15 per share, which will be paid to common stockholders on Nov. 25.
PennyMac Mortgage Investment Trust, a real estate investment trust managed by PennyMac Financial Services, also reported third quarter earnings on Nov. 5. It reported a net income of $93.3 million, or 94 cents per common share on a diluted basis, for the third quarter of 2020, up more than 46 percent from a year ago.
PennyMac Mortgage Investment Trust also repurchased about 492,000 common shares, for a total cost of about $8.3 million.
“PMT’s investments in credit risk transfer continued to benefit from the improvement in the market value for risk assets and elevated prepayment speeds,” Spector said. “We remain focused on leveraging PMT’s market position, along with PennyMac Financial’s expertise and technology platform, to continue to deploy capital in attractive investments and deliver strong risk-adjusted returns to shareholders.”
The company paid a cash dividend of $0.40 per common share on Oct. 30.