Guild Holdings Company

Good afternoon, ladies and gentlemen, and welcome to the Guild Holdings Company second quarter 2021 earnings conference call. At this time, all participants are in listen-only mode, and later we will be conducting a question and answer session, and instructions will be provided at that time. As a reminder, this call is being recorded, and I will now like to turn the conference over to Mr. Kim, Michael Kim, rather, Investor Relations. Please go ahead, Michael.

Thank you, and good afternoon, everyone. Before we begin, I'd like to remind everyone that comments on this conference call may contain certain forward-looking statements regarding the company's expected operating and financial performance for future periods. These statements are based on the company's current expectations. Actual results for future periods may differ materially from those expressed or implied by these forward-looking statements due to a number of risks or other factors that are described in greater detail under risk factors in GILs Form 10-K and 10-Q and other reports filed with the U.S. Securities and Exchange Commission. Additionally, today's remarks will refer to certain non-GAAP financial measures. Reconciliations of non-GAAP financial measures where appropriate to the corresponding GAAP measures can be found in today's earnings release filed with the SEC as well as on GILD's Investor Relations website. Participating in the call today are Chief Executive Officer Mary Ann McGarry, President Terry Schmidt, and Chief Financial Officer Amber Elwell. Now, I'd like to turn the call over to Mary Ann McGarry. Mary Ann?

Thank you, Michael. Good afternoon, everyone, and thank you for joining us. Before we discuss second quarter results, I wanted to thank all Guild employees for their hard work. Our people are at the heart of Guild and drive our continued success. I am proud that Guild was named as one of the best mortgage companies to work for in 2021 by National Mortgage News. I am joined by our president, Terry Schmidt, who will discuss how GILD is strategically positioned for growth. Our Chief Financial Officer, Amber Elwell, will review our financial results for the second quarter, and then we will be joined by our Chief Operating Officer, David Nayland, for Q&A. I wanted to start by providing some perspective on the market. Margins have increasingly compressed due in part to rising competitive pressures. It is anticipated that these market dynamics will continue through the balance of the year as forecasted by the MBA. This dynamic led to lower gain on sale margins in the second quarter. Yet Guild was able to produce results slightly above pre-COVID levels. We remain confident that we will continue to deliver sustainable and profitable growth across market cycles as we've successfully been doing for 60 years. We're purchase-focused and service-oriented with a servicing division we can scale. We provide a personalized and individualized experience where clients return to us and refer Guild to others. We can adapt and compete effectively against many different businesses and models. For example, in June, We were named as one of the best online lenders by Mortgage Professional America. Year after year, because of our business model and our ability to adjust, we maintain durable volume and consistent returns that are less sensitive to various market cycles compared to our peers. Another key to our success is servicing. Our portfolio has scaled from $2.5 billion of unpaid principal balance in 2007 to $66 billion as of June 30th, with loan servicing fees rising 26% year-over-year to $48 million in the second quarter. Our servicing platform is important to client retention. We retain servicing rights of 92% of total loans sold in the second quarter. As interest rates rise, servicing functions as a natural hedge to originations with favorable valuation adjustments to the MSR asset. In the second quarter, total funded originations were $8.2 billion, while purchase mortgage originations were $4.9 billion, up 34% on a sequential basis. We generated adjusted net income of $52 million and adjusted earnings per share of 87 cents for the second quarter. Year-to-date volumes were up strongly compared to the first half of 2020, showing the strength of our differentiated platform compared to most peers. So with that, I'd like to turn it over to our president, Terri Schmidt. Terri?