Good afternoon and welcome to the First Quarter Earnings Discussion for PennyMac Financial Services, Inc. The slides that accompany this discussion are available on PennyMac Financial's website at ir.pennymacfinancial.com. Before we begin, let me remind you that this discussion contains forward-looking statements that are subject to risks identified on Slide 2 that could cause our actual results to differ materially as well as non-GAAP measures that have been reconciled to their GAAP equivalent in our earnings presentation. Now I'd like to begin by introducing David Spector, PennyMac Financial's Chairman and Chief Executive Officer, who will review the company's first quarter 2022 results.

Thank you, Isaac. PennyMac Financial's first quarter results demonstrate the earnings power of our comprehensive mortgage banking platform against the backdrop of a rising interest rate environment, and significant competition among industry participants with excess capacity in this smaller origination market, increased income from our servicing business more than offset the decline in production income caused by the current transition in the origination market. As a result, PFSI produced net income of $174 million or diluted earnings per share of $2.94, representing an annualized return on equity of 20%. With regard to our capital usage, we continue to repurchase shares, and in the first quarter we repurchased 2.3 million shares of PFSI common stock for an approximate cost of $141 million. And in April, we repurchased an additional 905,000 shares for an approximate cost of $44 million. The pace of share repurchases was down from last quarter, as we believe it is prudent to retain capital during periods of greater volatility. PFSI's Board of Directors also declared a first quarter cash dividend of $0.20 per share. In total, this strong financial performance drove continued growth in book value per share, which was up 3% from December 31 to $62.19 at March 31. Dan Perotti, PFSI's Senior Managing Director and Chief Financial Officer will review additional details of our financial performance later on in this discussion. In total, loan acquisition and origination volumes were $33 billion in the first quarter. These production volumes more than offset prepayment activity in PennyMac Servicing portfolio, which totaled nearly $520 billion in unpaid principal balance at March 31, up 2% from the end of the prior quarter, and up 16% from the same time last year. In PFSI's Investment Management segment, net assets under management were $2.2 billion at quarter-end down from the prior quarter…

Thanks, David. A large servicing business is essential for the success of a mortgage bank in a rising rate environment. Our de novo servicing platform was built from scratch, void of any legacy issues that arose from the great financial crisis. And we've invested significantly throughout our history to ensure that we were able to efficiently and effectively serve our customers at the highest standards. Our leading production business has driven the strong organic growth of our servicing portfolio. And today, I'm extremely proud of the more than half trillion in UPB of servicing that we managed, and more than 2.2 million customers we serve. As a key part of our balanced business model, our large servicing portfolio provides significant value to the company. Servicing and sub servicing fees generated over $1 billion in revenue annually. And PFSI is expected to further benefit in the near-term as higher short-term interest rates are expected to drive increased interest income on our custodial deposit balances. In 2019, we launched our own proprietary cloud based servicing system designed specifically for PennyMac's unique workflows. SSE as we call it, not only provides us with the cost efficiencies by reducing third-party vendor expenses, but increases our flexibility, enabling us to adapt quickly to current market conditions, or forthcoming regulation. Additionally, SSE provides invaluable insight to our servicing team members dedicated to assisting customers with hardships and mitigating losses. Going even further, SSE provides the data we use to better understand our customers needs, so loan officers in our Consumer Direct channel can assist borrowers with products that can benefit them. Finally, given the scale we have achieved, we have begun to work with Hippo to offer homeowners insurance to our servicing portfolio customers, and are currently evaluating other potential partnerships to explore ways to better…

Thanks, Doug. As David mentioned earlier, PFSI's net income was $174 million or diluted earnings per share of $2.94. Production segment pretax income was $9.3 million. As you will see on Slide 10, we provide a breakdown of the revenue contribution from each of PFSI's loan production channels, net of loan origination expenses, including fulfillment fees received from PMT for conventional correspondent loans. Production revenue margins in Consumer Direct continued to decline from the prior quarter. Broker Direct margins also declined from the prior quarter and remained below their normalized levels. Government correspondent margins were also down slightly. Revenue per fallout adjusted lock for PFSI's own account was 102 basis points in the first quarter, down from 113 basis points in the prior quarter. This includes $19.5 million in losses realized related to timing of revenue and loan origination expense recognition, hedging, pricing and execution changes, and other items. We recognize that expenses in our production segment remain elevated given the rapid decline in the size of the overall origination market, and are actively working to adjust these expenses to better align with lower expected volumes. The servicing segment recorded pretax income of $225.2 million, up from pretax income of $126.1 million in the prior quarter and $141.7 million in the first quarter of 2021. Pretax income, excluding valuation-related items for the servicing segment was $86 million, down from the prior quarter, primarily as a result of lower EBO-related income. Operating revenue was essentially unchanged from the prior quarter. Operating expenses, as a percentage of average servicing portfolio UPB, increased primarily due to seasonal collection trends, but were down from the first quarter of last year. Payoff-related expenses, which include interest shortfall and recording and release fees related to prepayments, decreased by $6.2 million. Realization of MSR cash flows increased $14 million, driven by higher average MSR values during the quarter. In order to protect the value of our MSR asset, we utilize a comprehensive hedging strategy. This strategy is designed to moderate the impact of interest rate changes on the fair value of our MSR asset and also considers production-related income. On Slide 14, you can see the fair value of our MSR increased by $324 million in the first quarter, driven by higher mortgage rates, which resulted in expectations for lower prepayment activity in the future. Hedging losses totaled $218 million, primarily driven by higher interest rates. Finally, our Investment Management segment delivered pretax income of $97,000, down from $1.5 million in the prior quarter. Net assets under management totaled $2.2 billion as of March 31, down 6% from December 31 and March 31, 2021. Segment revenue was $10.1 million, down 3% from the prior quarter and up 6% from the first quarter of 2021. And with that, I would like to turn it back to David for some closing remarks.

Thank you, Dan. And thank you to our current shareholders and potential investors listening to the call. While the current mortgage market is going through rapid changes and transitioning to a more purchase-oriented focus, we feel PFSI is well-positioned due to the strength of our balanced business model, our position as a leading producer of purchase mortgages, and our risk management capabilities. We have successfully navigated many mortgage cycles throughout our history, and I firmly believe there is not a better management team than PennyMac's to navigate this one. We encourage investors with any questions to reach out to our Investor Relations team by e-mail or phone. Thank you.

This concludes PennyMac Financial Services, Inc.'s first quarter earnings discussion. For any questions, please visit our website at ir.pennymacfinancial.com or call our Investor Relations department at (818)-264-4907. Thank you.