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Press Release: PennyMac Financial Services, Inc. -4-

· 02/04/2021 16:30
PENNYMAC FINANCIAL SERVICES, INC. CONSOLIDATED BALANCE SHEETS (UNAUDITED) December 31, September 30, December 31, 2020 2020 2019 --------------- --------------- --------------- (in thousands, except share amounts) ASSETS Cash $ 532,716 $ 529,166 $ 188,291 Short-term investments at fair value 15,217 102,136 74,611 Loans held for sale at fair value 11,616,400 9,126,172 4,912,953 Assets purchased from PennyMac Mortgage Investment Trust under agreements to resell pledged to creditors 80,862 86,958 107,512 Derivative assets 711,238 578,254 159,686 Servicing advances, net 579,528 393,654 331,169 Mortgage servicing rights 2,581,174 2,333,821 2,926,790 Operating lease right-of-use assets 74,934 72,133 73,090 Investment in PennyMac Mortgage Investment Trust at fair value 1,105 991 1,672 Receivable from PennyMac Mortgage Investment Trust 87,005 122,478 48,159 Loans eligible for repurchase 14,625,447 17,183,873 1,046,527 Other 692,169 651,229 333,557 ----------- ----------- ----------- Total assets $ 31,597,795 $ 31,180,865 $ 10,204,017 =========== =========== =========== LIABILITIES Assets sold under agreements to repurchase $ 9,654,797 $ 7,259,188 $ 4,141,053 Mortgage loan participation and sale agreements 521,477 535,063 497,948 Obligations under capital lease 11,864 13,957 20,810 Notes payable secured by mortgage servicing assets 1,295,840 1,295,143 1,294,070 Unsecured senior notes 645,820 492,358 - Excess servicing spread financing payable to PennyMac Mortgage Investment Trust at fair value 131,750 142,990 178,586 Derivative liabilities 42,638 24,537 22,330 Mortgage servicing liabilities at fair value 45,324 31,698 29,140 Operating lease liabilities 94,193 92,005 91,320 Accounts payable and accrued expenses 308,398 278,403 175,273 Payable to PennyMac Mortgage Investment Trust 140,306 77,136 73,280 Payable to exchanged Private National Mortgage Acceptance Company, LLC unitholders under tax receivable agreement 35,165 35,784 46,158 Income taxes payable 622,700 673,149 504,569 Liability for loans eligible for repurchase 14,625,447 17,183,873 1,046,527 Liability for losses under representations and warranties 32,688 28,504 21,446 ----------- ----------- ----------- Total liabilities 28,208,407 28,163,788 8,142,510 ----------- ----------- ----------- STOCKHOLDERS' EQUITY Common stock--authorized 200,000,000 shares of $0.0001 par value; issued and outstanding 70,905,532, 72,400,490, and 78,515,047 shares, respectively 7 7 8 Additional paid-in capital 1,047,052 1,116,428 1,335,107 Retained earnings 2,342,329 1,900,642 726,392 ----------- ----------- ----------- Total stockholders' equity 3,389,388 3,017,077 2,061,507 ----------- ----------- ----------- Total liabilities and stockholders' equity $ 31,597,795 $ 31,180,865 $ 10,204,017 =========== =========== =========== PENNYMAC FINANCIAL SERVICES, INC. CONSOLIDATED STATEMENTS OF INCOME (UNAUDITED) Quarter ended ----------------------------------------------- December 31, September December 31, 2020 30, 2020 2019 ----------------- ----------- --------------- (in thousands, except earnings per share) Revenue Net gains on loans held for sale at fair value $ 859,061 $ 855,269 $ 257,487 Loan origination fees 93,460 75,572 63,868 Fulfillment fees from PennyMac Mortgage Investment Trust 72,606 54,839 58,297 Net loan servicing fees: Loan servicing fees 262,740 250,368 234,871 Change in fair value of mortgage servicing rights, mortgage servicing liabilities and excess servicing spread financing (127,097) (124,082) 45,246 Hedging results (109,147) 6,521 (192,386) --------- --------- -------- Net loan servicing fees 26,496 132,807 87,731 --------- --------- -------- Net interest (expense) income: Interest income 74,192 52,952 76,015 Interest expense 93,653 63,179 65,132 --------- --------- -------- (19,461) (10,227) 10,883 Management fees from PennyMac Mortgage Investment Trust 8,687 8,508 10,314 Change in fair value of investment in and dividends received from PennyMac Mortgage Investment Trust 149 (288) 39 Results of real estate acquired in settlement of loans 233 1,214 (648) Revaluation of payable to exchange Private National Mortgage Acceptance Company, LLC unitholders under tax receivable agreement 280 - 379 Other 635 2,298 2,025 --------- --------- -------- Total net revenue 1,042,146 1,119,992 490,375 --------- --------- -------- Expenses Compensation 187,807 202,440 141,009 Servicing 87,155 71,110 57,487 Loan origination 69,069 53,752 44,919 Technology 42,594 28,964 15,515 Professional services 19,853 18,307 10,983 Occupancy and equipment 8,535 8,491 7,841 Other 9,907 8,637 9,255 --------- --------- -------- Total expenses 424,920 391,701 287,009 --------- --------- -------- Income before provision for income taxes 617,226 728,291 203,366 Provision for income taxes 164,422 193,131 50,705 --------- --------- -------- Net income $ 452,804 $ 535,160 $ 152,661 ========= ========= ======== Earnings per share Basic $ 6.31 $ 7.39 $ 1.95 Diluted $ 5.97 $ 7.03 $ 1.88 Weighted-average common shares outstanding Basic 71,793 72,439 78,466 Diluted 75,898 76,138 81,076 Dividend declared per share $ 0.15 $ 0.15 $ - PENNYMAC FINANCIAL SERVICES, INC. CONSOLIDATED STATEMENTS OF INCOME (UNAUDITED) Year ended December 31, --------------------------------------- 2020 2019 2018 ---------- --------- -------- (in thousands, except earnings per share) Revenue Net gains on loans held for sale at fair

This press release contains financial information calculated other than in accordance with U.S. generally accepted accounting principles ("GAAP"), such as pretax income excluding valuation items that provide a meaningful perspective on the Company's business results since the Company utilizes this information to evaluate and manage the business. Non-GAAP disclosure has limitations as an analytical tool and should not be viewed as a substitute for financial information determined in accordance with GAAP.

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February 04, 2021 16:30 ET (21:30 GMT)