Pennymac Financial Services, Inc. · NYSE:PFSI
Pennymac Financial Services — Q1 2026 Earnings Presentation
26 slides from Pennymac Financial Services's earnings presentation, May 5, 2026
Slide 1: 1Q26 Earnings Report
1Q26 EARNINGS REPORT PennyMac Financial Services, Inc. May 2026
Slide 2: Forward-Looking Statements
FORWARD-LOOKING STATEMENTS This presentation contains forward-looking statements within the meaning of Section 21E of the Securities Exchange Act of 1934, as amended, regarding management’s beliefs, estimates, projections and assumptions with respect to, among other things, our financial results, fut
Slide 3: First Quarter Highlights
FIRST QUARTER HIGHLIGHTS 1Q26 Production Servicing Results Segment Segment Net Book value Pretax Pretax income per share income income $82mm $83.31 $134mm $13mm Pretax income excluding Diluted Adjusted Total loan acquisitions PFSI correspondent valuation-related Valuation-related EPS(1) EPS(1)(2) an
Slide 4: Business Updates
BUSINESS UPDATES Repurchased 1% of common stock outstanding for $50 million at a weighted average price of $89.28 per share Continued to make progress on the acquisition of Cenlar’s subservicing business and expect the transaction to close in the second half of this year, as initially expected Succe
Slide 5: 1Q26 Strategic Update
1Q26 STRATEGIC UPDATE ™ PENNYMAC
Slide 6: Delivering Double-Digit Adjusted Returns on Equity
DELIVERING DOUBLE-DIGIT ADJUSTED RETURNS ON EQUITY Annualized Adjusted ROE(1) Mortgage Banking Adjusted Pretax Income ($ in millions) Servicing net of valuation related changes(1) Production With a smaller projected origination market due to higher interest rates, we expect adjusted ROEs to remain n
Slide 7: Earnings Potential from Consumer Direct Recapture Opportunity
EARNINGS POTENTIAL FROM CONSUMER DIRECT RECAPTURE OPPORTUNITY Gov’t. Loans: Note Rates >5%(1) Gov’t. Loan First Lien Refinance Recapture (UPB in billions) Refinance Recapture Origination Volume (UPB in billions) First-lien refinance recapture rate(2) > 7.00% • Improvement in 6.50 - 6.99% conventional fi
Slide 8: Technology and Scale to Continue Driving Efficiencies
TECHNOLOGY AND SCALE TO CONTINUE DRIVING EFFICIENCIES Consumer Direct Servicing Corporate & Other Reducing unit costs to historic Driving a significantly lower unit Achieving more with less lows through technology-driven cost as our portfolio expands through a unified technology automation with signifi
Slide 9: Key Operating Metrics & Other Financial Schedules
KEY OPERATING METRICS & OTHER FINANCIAL SCHEDULES
Slide 10: Production Segment Highlights – Volume by Channel
PRODUCTION SEGMENT HIGHLIGHTS – VOLUME BY CHANNEL Correspondent Broker Direct Consumer Direct (UPB in billions) (UPB in billions) (UPB in billions) Acquisitions for PFSI(1) Acquisitions for PMT(2) Originations Locks Originations Locks (3) Total Locks April April April Locks: $8.9bn Locks: $3.1bn Loc
Slide 11: Drivers of Production Segment Results
DRIVERS OF PRODUCTION SEGMENT RESULTS 1Q25 4Q25 1Q26 Revenue Revenue Revenue Fallout Margin / Contribution % of Fallout Margin / Contribution % of Fallout Margin / Contribution % of ($ in millions) Adjusted Fulfillment (net of Loan Production Adjusted Fulfillment (net of Loan Production Adjusted Fulfil
Slide 12: Servicing Segment Highlights
SERVICING SEGMENT HIGHLIGHTS • Servicing portfolio totaled $720.3 billion in UPB at March 31, Loan Servicing Portfolio Composition (UPB in billions) 2026, down 2% Q/Q and up 6% Y/Y ‒ Production volume was more than offset by $26 billion in runoff from prepayments and the previously-announced sale of
Slide 13: Drivers of Servicing Segment Results
DRIVERS OF SERVICING SEGMENT RESULTS(1) 1Q25 4Q25 1Q26 basis basis basis $ in millions points(2) $ in millions points(2) $ in millions points(2) Loan servicing fees $ 488.5 29.0 $ 532.2 29.4 $ 532.1 29.5 Earnings on custodial balances and deposits and other income(3) 96.0 5.7 128.1 7.1 105.3 5.8 Rea
Slide 14: Hedging Approach Moderates the Volatility of PFSI's Results
HEDGING APPROACH MODERATES THE VOLATILITY OF PFSI’S RESULTS MSR Valuation Changes and Offsets ● In 1Q26, gains from changes in fair value on MSR were ($ in millions) more than offset by hedging declines and costs MSR fair value changes before realization of cash flows(1) ● Hedge costs were contained
Slide 15: Strong Balance Sheet and Diverse Capital Structures
STRONG BALANCE SHEET AND DIVERSE CAPITAL STRUCTURES Low Debt-to-Equity (D/E) Ratio • Active management of targeted D/E ratios: ‒ D/E ratios increased slightly due to increased direct lending production and higher interest rate levels ‒ Expect D/E ratios to remain near these levels in the current int
Slide 16: Appendix
APPENDIX ™ PENNYMAC
Slide 17: Comprehensive Mortgage Banking Platform is a Flywheel
COMPREHENSIVE MORTGAGE BANKING PLATFORM IS A FLYWHEEL Large volumes of production grow servicing portfolio Loan Production Loan Servicing 2nd largest in the U.S.(1) 5th largest in the U.S.(2) Servicing Portfolio UPB(2) (in billions) Correspondent Broker Consumer Production Direct Direct Leading mark
Slide 18: Track Record of Strong Performance Across Market Environments
TRACK RECORD OF STRONG PERFORMANCE ACROSS MARKET ENVIRONMENTS PFSI's Annualized Return on Average Common Stockholders' Equity (ROE) Proven ability to generate attractive ROEs… U.S. Origination Market(3) 10-Year Treasury Yield(4) (in trillions) …across different market environments… PFSI Purchase Mix
Slide 19: Current Market Environment and Macroeconomic Trends
CURRENT MARKET ENVIRONMENT AND MACROECONOMIC TRENDS Average 30-year fixed rate mortgage(1) 6.15% 6.38% 10-year Treasury Bond Yield(2) 4.17% 4.32% U.S. Origination Market Forecast(3) Macroeconomic Metrics(4) (UPB in trillions) 3/31/25 6/30/25 9/30/25 12/31/25 3/31/26 10-year Treasury bond yield 4.2% 4
Slide 20: PennyMac's Market Share Over Time Across Its Businesses
PENNYMAC’S MARKET SHARE OVER TIME ACROSS ITS BUSINESSES Correspondent Production Market Share(1) Loan Servicing Market Share(1) Broker Direct Market Share(1) Consumer Direct Market Share(1) Note: All figures are for PFSI and include volume fulfilled or subserviced for PMT (1) Historical market share:
Slide 21: Technology Driving Efficiencies and Lower Expenses in Servicing
TECHNOLOGY DRIVING EFFICIENCIES AND LOWER EXPENSES IN SERVICING Direct Servicing Expense(1) Operating Expenses(2) (annual $ cost per loan) (annualized bps of average servicing portfolio UPB) % Government Portfolio • Pennymac’s per loan servicing expenses are among the lowest in • Culture of continuo
Slide 22: Delinquency Trends and Servicing Advances Outstanding
DELINQUENCY TRENDS AND SERVICING ADVANCES OUTSTANDING Trends in Delinquency and Foreclosure Rates(1) 30-60 Day 60-90 Day 90+ Day In foreclosure ● Overall, mortgage delinquency rates for the MSR portfolio decreased from the prior quarter, consistent with typical seasonal trends and within expected ra
Slide 23: Reconciliation of GAAP Net Income to Adjusted EBITDA
RECONCILIATION OF GAAP NET INCOME TO ADJUSTED EBITDA(1) ($ in millions) 1Q25 4Q25 1Q26 Net income $ 76.3 $ 106.8 $ 82.3 Provision for (benefit from) income taxes 27.9 27.6 22.4 Income before provision for income taxes 104.2 134.4 104.7 Depreciation and amortization 13.9 12.8 13.5 (Increase) decrease
Slide 24: Reconciliation of GAAP Items to Non-GAAP Items
RECONCILIATION OF GAAP ITEMS TO NON-GAAP ITEMS Reconciliation of GAAP net income to adjusted net income, adjusted EPS and annualized adjusted return on equity(1) ($ in millions) 1Q25 2Q25 3Q25 4Q25 1Q26 Net income $ 76.3 $ 136.5 $ 181.5 $ 106.8 $ 82.3 (Increase) decrease in fair value of MSRs and MS
Slide 25: Reconciliation of GAAP Items to Non-GAAP Items
RECONCILIATION OF GAAP ITEMS TO NON-GAAP ITEMS Reconciliation of GAAP servicing pretax income to servicing pretax income net of valuation related changes(1) ($ in millions) 1Q25 2Q25 3Q25 4Q25 1Q26 Servicing pretax income $ 76.0 $ 54.2 $ 157.4 $ 37.3 $ 12.7 (Increase) decrease in fair value of MSRs
Slide 26: PennyMac Financial Services
™ PENNYMAC FINANCIAL SERVICES,
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