Segments

3 Months Ended

Mar. 31, 2023

Segments

Segments

Note 23—Segments

The Company conducts its business in three segments: production, servicing (together, production and servicing comprise its mortgage banking activities) and investment management:

● The production segment performs loan origination, acquisition and sale activities.

● The servicing segment performs loan servicing for loans held for sale and loans serviced for others, including for PMT.

● The investment management segment represents the Company’s investment management activities relating to PMT, which include the activities associated with investment asset acquisitions and dispositions such as sourcing, due diligence, negotiation and settlement.

The Company’s reportable segments are identified based on their unique activities. The Company’s chief operating decision maker is its chief executive officer. The following disclosures about the Company’s business segments are presented consistent with the way the Company’s chief operating decision maker organizes and evaluates financial information for making operating decisions and assessing performance.

Financial performance and results by segment are as follows:

	Quarter ended March 31, 2023
	Mortgage Banking						Investment
	Production		Servicing		Total		Management		Total
	(in thousands)
Revenues: (1)
Net gains on loans held for sale at fair value	$	74,726	$	29,659	$	104,385	$	—	$	104,385
Loan origination fees		31,390		—		31,390		—		31,390
Fulfillment fees from PennyMac Mortgage Investment Trust		11,923		—		11,923		—		11,923
Net loan servicing fees		—		148,837		148,837		—		148,837
Net interest income (expense):
Interest income		56,993		71,485		128,478		—		128,478
Interest expense		54,083		77,688		131,771		—		131,771
		2,910		(6,203)		(3,293)		—		(3,293)
Management fees		—		—		—		7,257		7,257
Other		574		(223)		351		2,012		2,363
Total net revenues		121,523		172,070		293,593		9,269		302,862
Expenses		141,163		114,623		255,786		8,929		264,715
Income before provision for income taxes	$	(19,640)	$	57,447	$	37,807	$	340	$	38,147
Segment assets at quarter end	$	7,543,466	$	12,534,419	$	20,077,885	$	25,300	$	20,103,185

(1) All revenues are from external customers.

	Quarter ended March 31, 2022
	Mortgage Banking						Investment
	Production		Servicing		Total		Management		Total
	(in thousands)
Revenues: (1)
Net gains on loans held for sale at fair value	$	221,610	$	76,849	$	298,459	$	—	$	298,459
Loan origination fees		67,858		—		67,858		—		67,858
Fulfillment fees from PennyMac Mortgage Investment Trust		16,754		—		16,754		—		16,754
Net loan servicing fees		—		286,309		286,309		—		286,309
Net interest income (expense):
Interest income		30,941		22,941		53,882		—		53,882
Interest expense		27,059		50,248		77,307		—		77,307
		3,882		(27,307)		(23,425)		—		(23,425)
Management fees		—		—		—		8,117		8,117
Other		785		616		1,401		2,031		3,432
Total net revenues		310,889		336,467		647,356		10,148		657,504
Expenses		301,619		111,314		412,933		10,051		422,984
Income before provision for income taxes	$	9,270	$	225,153	$	234,423	$	97	$	234,520
Segment assets at quarter end	$	4,905,974	$	9,689,282	$	14,595,256	$	22,646	$	14,617,902

(1) All revenues are from external customers.

(