PennyMac Mortgage Investment Trust : Corporate sustainability lives here.

2023

Corporate

Sustainability Report

ABOUT THIS REPORT

This 2023 Corporate Sustainability Report (or Report) will focus on sustainability factors that are relevant for PennyMac Financial Services, Inc. (NYSE: PFSI), our business, and our communities, and will highlight our commitment to increased transparency in our sustainability practices. We are pleased to share this Report with you as it demonstrates how our business creates value for our stakeholders.

This Report has been prepared in accordance with the principles and disclosures of the Global Reporting Initiative (GRI) Standards: Core Option and the Sustainability Accounting Standards Board (SASB) Mortgage Finance Standard. The GRI Standards aim to enable companies to understand and report on their impacts on the economy, environment and people in a comparable and credible way, thereby increasing transparency on their contribution to sustainable development. SASB's mission is to develop and disseminate sustainability accounting standards that help public companies disclose information that SASB deems to be material, decision useful information to investors. The SASB disclosures included in this Report are highlighted in the SASB Index Disclosures. The highlights and metrics shared in this Report represent the 2023 fiscal year and, where helpful, we have provided information related to events that occurred subsequent to the year end but prior to the publication of this Report.

We are committed to transparency in sustainability reporting, and we are working to continually improve our reporting as industry best practices evolve. We have redesigned and streamlined our Corporate Sustainability Report this year to help stakeholders identify the most decision-useful information, while maintaining consistency and transparency in our year-over-year data.

To view additional information online about PFSI, as well as this Report, please visit our Investor Relations website at pfsi.pennymac.com.

TABLE OF CONTENTS

About This Report
Message from Our Chairman and CEO	1
About the Company	3
Our Vision, Mission, Core Values and Leadership Standards	4
Our 2023 Corporate Highlights and Business Strategies	5
Our Corporate Sustainability Approach	7
Operating Ethically, Responsibly and Sustainably	12
Board of Directors Leadership	12
Board Governance	12
Director Skills and Qualifications	13
Board Diversity	14
Governance Best Practices	14
Our Board's Role in Risk Oversight	15
Executive Compensation	16
Our Code of Business Conduct and Ethics and Human Rights	16
Whistleblower and Ethics Hotline Reporting	18
Regulatory Compliance	18
Anti-Money Laundering, Anti-Corruption and Fraud Prevention	19
Political Contributions and Advocacy	19
Enterprise Risk Management	20
Tax Strategy	22
Business Continuity and Crisis Management	22
Data Privacy and Cybersecurity	22
Improving the Lives of Customers, Employees and Communities	25
Responsible Lending	25
Sustainable Homeownership	26
Human Capital Management	28
Diversity, Equity, and Inclusion	32
Economic Inclusion with Vendors	38
Company Culture	38
Employee Health and Wellness	40
Philanthropy and Community Engagement	43
Company Recognition	48
Employee Recognition	50
Advancing Environmental Sustainability in Our Operations	51
Our Environmental Responsibility	51
Our Environmental Impact	51
Waste Reduction and Management	52
Energy Efficiency	54
Water Recycling and Conservation	54
Climate and Environmental Risk Management	55
Global Reporting Initiative (GRI) Content Index	58
Sustainability Accounting Standards Board (SASB) Index Disclosure	65

MESSAGE FROM

OUR CHAIRMAN AND CEO

As Chairman and CEO of PennyMac Financial Services, Inc., I am pleased to share with all stakeholders our 2023 Corporate Sustainability Report (referred to as the Report). Since the beginning, our vision has been to revitalize the mortgage market and create a mortgage bank that would become one of the most respected and trusted in the industry. In support of that vision, we are guided by an unwavering commitment to advancing our core values of being Accountable, Reliable and Ethical (A.R.E.) and operating our business in a way that creates positive governance, social and environmental impacts and long-term, sustainable growth.

This Report is intended to be a companion to the PennyMac Financial Services, Inc. 2023 Annual Report to Stockholders and 2024 Notice of Annual Meeting and Proxy Statement. This Report evidences our commitment to voluntarily reporting on our sustainability investments and impacts, supporting the evolving information needs of our stakeholders, and approaching sustainability with the goal of minimizing our risk profile and maximizing our operational and financial performance.

2023 was one of the more challenging origination markets in recent history, with industry volumes down approximately 40 percent from 2022 and unit originations at their lowest levels since 1990. However, Pennymac, through its multi-channel production platform, demonstrated both our strong access to the purchase market and our ability to profitably support our customers and business partners. Our scaled and growing servicing business was key to the success we have achieved, driving earnings in higher interest rate environments and future opportunities as our customer base continues to expand.

The challenges encountered by our company and the broader industry in 2023 underscored the crucial need to continue integrating sustainability into all facets of our operations to bolster business resilience and foster long-term value creation. Corporate sustainability shapes our governance practices, guides our strategic business decisions, and informs our approach to human capital management. In addition, our Board of Directors and executive leadership team are aligned on the significance of effectively managing our long-term sustainability and mitigating sustainability-related risks. It stands as a cornerstone discipline that will remain instrumental in our capacity to drive sustainable business growth and maintain our leadership position within the mortgage industry.

At PFSI, we are dedicated to upholding a comprehensive framework of governance policies and practices that prioritize the highest levels of oversight, ethics, and integrity. Central to this commitment is our Board's vigilant oversight of our corporate sustainability initiatives, our robust enterprise risk management framework, and the implementation of policies and procedures aimed at fostering business conduct aligned with our GREAT (Grow. Respect. Energize. Achieve. Together.) leadership standards and core values of being Accountable, Reliable and Ethical. These components collectively reinforce our unwavering pursuit of long-term success as an organization.

We are purposeful in our endeavors to foster positive social impact through our business practices, within our workplace, and across the communities we serve. To advance these aims, we implement a range of enterprise-wide strategies aimed at positioning ourselves as an employer of choice, ensuring the attraction, development, engagement, and retention of top-tier talent. At PFSI, we are deeply committed to nurturing an inclusive workforce, empowering individuals from diverse

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backgrounds and experiences to connect, contribute, thrive, and realize their fullest potential. Furthermore, we consistently prioritize the health and wellness of our employees and actively support meaningful and impactful engagement with both local and national community organizations.

We understand that environmental stewardship is a shared responsibility and recognize the opportunity and importance of managing our environmental impact while minimizing our exposure to weather and climate-related events. Several facets of our business exemplify this dedication, such as our initiatives to reduce and manage waste, enhance energy efficiency, prioritize water conservation, and conduct thorough analyses of climate-related risks.

Given the unprecedented challenges encountered in 2023, our commitment to executing our strategic priorities and fostering long-term, sustainable value for all stakeholders remains resolute. I am continually inspired by the opportunity to collaborate with PFSI's seasoned and dedicated management team, who diligently ensure that we consistently prioritize the best interests of our customers, employees, investors, and other stakeholders. I encourage you to explore further insights into our approach in this Report.

Sincerely,

David A. Spector

Chairman and Chief Executive Officer

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ABOUT THE COMPANY

PennyMac Financial Services, Inc. (or PennyMac Financial) is a specialty financial services firm focused on the production and servicing of U.S. mortgage loans and the management of investments related to the U.S. mortgage market. PennyMac Financial externally manages PennyMac Mortgage Investment Trust (or PMT, and collectively with PennyMac Financial and their affiliates, referred to herein as Pennymac), which is a mortgage real estate investment trust separately listed on the New York Stock Exchange (NYSE: PMT) that invests in mortgage-related assets (or PMT and, collectively with PennyMac Financial and their affiliates, referred to herein as Pennymac). Founded in 2008, PennyMac Financial is recognized as a leader in the U.S. residential mortgage industry and employs approximately 3,800 people across the country In 2023, PennyMac Financial's production of newly originated loans totaled $99 billion in unpaid principal balance, making it the second largest mortgage lender in the nation. As of December 31, 2023, PennyMac Financial serviced loans totaling $607 billion in unpaid principal balance, making it a top five mortgage servicer in the nation.

We operate and control all of the business and affairs and consolidate the financial results of Private National Mortgage Acceptance Company, LLC (PNMAC). Our principal mortgage banking subsidiary, PennyMac Loan Services, LLC (PLS or our Servicer), is a non-bank producer and servicer of mortgage loans. Our investment management subsidiary, PNMAC Capital Management, LLC (PCM), is an SEC registered investment adviser and the external manager of PMT.

We conduct our business in three segments: production, servicing (together, production and servicing comprise our mortgage banking activities) and investment management.

• The production segment performs loan origination, acquisition and sale activities for our account as well as for PMT.
• The servicing segment performs loan servicing for both newly originated loans we are holding for sale and loans we service for others, including for PMT.
• The investment management segment represents our investment management activities, which include the activities associated with investment asset acquisitions and dispositions such as sourcing, due diligence, negotiation and settlement.

On May 14, 2013, our common stock was listed on the New York Stock Exchange under the ticker symbol "PFSI." Our corporate headquarters office is located at 3043 Townsgate Road, Westlake Village, CA 91361.

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OUR VISION, MISSION, CORE VALUES AND LEADERSHIP STANDARDS

Our Pennymac DNA

Our VISION is to be the most trusted partner for home, and our MISSION is to build the foundation of homeownership by enabling Americans to achieve and sustain their aspirations of home. One of the key drivers of our long-termsuccess has been our strong organizational culture. We recognize the significance of creating an environment that can align with our vision and mission, sustain our successes and embed a common DNA around our values across our workforce. Our Company values are reflected in the phrase "We A.R.E. Pennymac" and establish our commitment to being Accountable, Reliable and Ethical in everything we do.

Our core values are reinforced by our G.R.E.A.T. leadership standards, which embody a steadfast commitment to GROW, RESPECT, ENERGIZE, and ACHIEVE TOGETHER. Our foundational behavioral standards help define the conduct we demonstrate daily with customers, team members and other stakeholders, which ultimately supports the achievement of our long-term business goals.

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OUR 2023 CORPORATE HIGHLIGHTS AND BUSINESS STRATEGIES

Corporate Highlights(1)

PennyMac Financial's operating discipline continues to drive strong financial performance notwithstanding a challenging mortgage environment.

Substantial stock price appreciation and return to stockholders

1. For complete information regarding our Fiscal 2023 performance, stockholders should read "Management's Discussion and Analysis of Financial Condition and Results of Operations" and the audited consolidated financial statements and accompanying notes thereto contained in our Annual Report on Form 10-K for the fiscal year ended December 31, 2023, which was filed with the Securities and Exchange Commission, or the SEC, on February 21, 2024 and is being made available to stockholders with this Proxy Statement as a part of our 2023 Annual Report to Stockholders.
2. Assumes $100 invested in PennyMac Financial Services, Inc. common stock and other stock market indices. The graph above displays certain information comparing the cumulative total return on our common stock to the cumulative total return of the Russell 2000 Index and the Dow Jones US Mortgage Finance Total Return Index. The comparison period is from December 31, 2020 to December 31, 2023, and the calculation assumes reinvestment of any dividends.

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Business Strategies

Our business strategies are based on five key focus areas: consumer direct lending, broker direct lending (also known as third-party origination), correspondent lending, mortgage loan servicing, and new markets and products.

Consumer Direct Lending

We expect to grow our consumer direct lending business over time by leveraging our growing servicing portfolio through the recapture of existing customers for refinance and purchase-money loans as well as increasing our non-portfolio originations. As our servicing portfolio grows, we will have a greater number of leads to pursue, which we believe will lead to greater origination activity through our consumer direct business. As of December 31, 2023, we serviced 2.4 million loans. In 2023, 2022 and 2021, we funded $4.8 billion, $15.4 billion and $43.1 billion of mortgage loans, respectively, through our consumer direct lending channel as market interest rates increased and refinance volumes decreased. We believe that our national call center model and our technology will enable us to drive origination process efficiencies and best-in-class customer service.

Broker Direct Lending

According to Inside Mortgage Finance, the broker lending channel represented approximately 16% of U.S. residential mortgage originations in 2023. In 2023, 2022 and 2021, we funded $8.1 billion, $6.9 billion and $16.8 billion of mortgage loans, respectively, through our wholesale-broker channel, which is comprised of loans from both the broker segment as well as loans purchased through our non-delegated correspondent segment. We plan on growing our mortgage loan volume in this channel through the addition of new broker and non-delegated partner relationships, as well as expansion of existing relationships enabled by our leading broker technology platform.

Correspondent Lending

We expect to support our correspondent production market share by expanding the number and types of sellers from which we purchase loans. We also expect to increase the proportion of our sellers' production volumes that we purchase as we continue to expand to the loan products and services we offer. We believe that we are well positioned to continue generating significant business in this channel based on our management expertise in the correspondent production business, our relationships with correspondent sellers, and our supporting systems and processes. In 2023, 2022 and 2021, we purchased $71.6 billion, $49.7 billion and $64.8 billion of mortgage loans, respectively, through our correspondent lending channel. In 2023, 2022, and 2021, we also fulfilled $14.9 billion, $37.1 billion and $110.0 billion of mortgage loans subject to fulfillment fees, respectively, for PMT.

Mortgage Loan Servicing Portfolio

We expect to grow our servicing portfolio through loan production activities, as our correspondent production for our own account and consumer and broker direct lending add new servicing for owned mortgage servicing rights (MSRs), and correspondent conventional production for PMT's account adds new subservicing. We may also grow our servicing portfolio through acquisitions. In 2023, our loan production totaled $99.4 billion in UPB. Our MSRs were backed by loans with UPBs totaling $370.2 billion as of December 31, 2023.

Expansion into New Markets and Products

We regularly evaluate opportunities to grow our business, including expansion into new markets and providing additional services to our customers directly or through external partnerships. We continue to develop new products to satisfy demand from customers in each of our production channels and respond to changing circumstances in the market for mortgage-related financing. For example, our closed-end second lien mortgage loan is offered to certain borrowers and is secured by a second lien on the mortgaged property subordinate to the rights of the first lien mortgage holder as well as other potential senior liens.

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OUR CORPORATE SUSTAINABILITY APPROACH

Corporate Sustainability as a Foundational Discipline

Our Corporate Sustainability Program was established as a core foundational discipline in 2020. We maintain a Corporate Sustainability Policy, which defines the framework, requirements and governing platform for how we identify and manage the sustainability impacts of our operations in furtherance of our strategic plan objectives.

Board and Management		Policies and
Oversight		Procedures

SOCIAL

Human Rights

Labor, Health & Safety

Stakeholders & Society

Product Safety, Quality

& Brand

GOVERNANCE	ENVIRONMENTAL
Audit & Risk Oversight	Risks & Opportunities
Board Structure	Carbon & Climate
Shareholder Rights	Natural Resources
Compensation	Water & Toxicity

The primary components of the Corporate Sustainability Policy are Board and Management Oversight, Policies and Procedures, Monitoring and Evaluation, and Sustainability Reporting.

Our Board and management oversight program component establishes who is responsible for providing oversight and making critical decisions. Currently, our Senior Managing Director, Chief Human Resources Officer and our Managing Director, Corporate Sustainability report directly to the Executive Committee and our Board's Nominating and Corporate Governance Committee.

Monitoring and		Sustainability
Evaluation		Reporting

We also establish policies and procedures that support and define the controls necessary to manage identified sustainability risks and opportunities.

Through ongoing monitoring and evaluation, we are able to measure those sustainability factors that are material to our business operations.

Finally, our commitment to sustainability reporting demonstrates to our internal and external stakeholders our commitment to corporate sustainability disclosures that we believe to be decision-useful, transparent, accurate and complete.

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