Good afternoon and welcome to the third 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 our 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 third quarter 2022 results.

Thank you, Isaac. In the third quarter, PennyMac Financial once again delivered strong financial performance with net income of $135 million or $2.46 in earnings per share. Meaningful income contributions from both our production and servicing segments led to an annualized return on equity of 16% and continued growth in PFSI's book value per share despite mortgage rates climbing to their highest levels in more than a decade. We ended the quarter with a servicing portfolio of $539 billion in unpaid principal balance as additions from loan production continued to offset prepayment activity. Importantly, I believe the growth of our servicing portfolio will continue to differentiate PFSI from its competition, serving as an increasingly important asset while the origination landscape remains challenging. Our balanced business model with leadership positions in production and servicing, combined with our robust risk management disciplines, supports our ability to profitably navigate different market environments. In the current environment, our servicing portfolio is contributing the majority of PFSI's earnings while also providing significant cash flow to support investments across our businesses. We remain active in repurchasing shares, which at current price levels is accretive to book value and beneficial for our future earnings. This quarter, we repurchased 1.9 million shares of PFSI common stock at an average price of $51.13, for an approximate cost of $100 million. Through October 26, we repurchased an additional 882,000 shares at an average price of $45.73, for an approximate cost of $40 million. In the near term, we expect the pace of share repurchases to trend lower in order to maintain our flexibility to address potential risks and opportunities in the evolving market environment. In PFSI's investment management segment, net assets under management were $2 billion at quarter end, down slightly from the prior quarter due to PMT's financial performance.…

Thanks, David. Overall production was solid in the third quarter given the market environment, with total production volumes down only 3% from the prior quarter. PennyMac maintained its leadership position in correspondent lending, as our strong capital position and consistent commitment to the channel provides our partners with stability and support they need to successfully navigate a challenging mortgage market. We estimate that, over the past 12 months, we represented approximately 14% of the channel overall. Total correspondent loan acquisition volume in the third quarter was $22.4 billion, of which 46% were conventional conforming loans for which PFSI earns a fulfillment fee from PMT. Government loan acquisition volumes were up 14% from the prior quarter, while conventional correspondent acquisitions were down only 1%. Government correspondent lock volume was up 9% from the prior quarter. Revenue per fallout-adjusted government lock in the third quarter was 24 basis points, down from 27 basis points in the prior quarter. The scale we have achieved in our correspondent business, combined with our low-cost structure and operational excellence in the channel, allow us to operate efficiently through the volatile market environment. In October, we estimate correspondent acquisitions will total $7.5 billion and locks will total $8 billion. Turning to consumer direct, we estimate that we accounted for approximately 1.4% of total originations in the channel over the last 12 months. Origination volumes for the third quarter were $2.3 billion and interest rate lock commitments were $3.8 billion, reflecting a steep decline in refinance volume. Purchase lock volume for the quarter of $1.4 billion was 36% of total locks, up significantly from 22% in the prior quarter. Margins in this channel expanded as we focused on meeting the needs of customers in our servicing portfolio. And revenue per fallout-adjusted lock was 366 basis points, up from…

Thanks, Doug. As David mentioned earlier, PFSI's net income was $135 million or diluted earnings per share of $2.46. Production segment pretax income was $39 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 the fulfillment fees received from PMT for conventional correspondent loans. Production revenue margins were mixed, with margins up in our consumer direct channel and down in our correspondent and broker direct channels. Revenue per fallout-adjusted lock for PFSI's own account was 99 basis points in the third quarter, unchanged from the prior quarter. This includes $36 million in gains realized related to the timing of revenue and loan origination expense recognition, hedging, pricing and execution changes and other items. As David mentioned, we remain focused on expense management activities given the current market environment. And although fallout-adjusted locks were down only 2% from the prior quarter, production expenses net of loan origination expense were down 21%. The servicing segment recorded pretax income of $145 million, down from pretax income of $168 million in the prior quarter and up from $8 million in the third quarter of 2021. Pretax income excluding valuation-related items for the servicing segment was $70 million, down from the prior quarter as higher loan servicing revenue, higher earnings on custodial balances and deposits and lower expenses were more than offset by higher realization of MSR cash flows and lower EBO-related income. Operating revenues increased from the prior quarter as loan servicing fees grew by $11 million, primarily due to growth in our servicing portfolio. Earnings on custodial balances and deposits increased by more than $30 million. As rates continue to rise, the earnings on these custodial balances will rise as well, with a…

Thank you, Dan. We remain focused on the broader challenges facing our industry in the near term. We will remain vigilant in our risk management disciplines and continue to actively pursue opportunities to further improve efficiency across our businesses. I continue to believe PennyMac is strategically well positioned in the mortgage market given our strong levels of capital, our large and growing servicing portfolio and our efficient and low-cost operating platform run by a best-in-class management team. We encourage investors with any questions to reach out to our investor relations team by e-mail or phone. Thank you.