Planet Home's 2Q results driven by acquisitions

Aided by its acquisition of Platinum Home Mortgage's assets, second-quarter origination volume at Planet Home Lending grew 13% from the previous quarter and 15% from the prior year period.

And the company is on the lookout for more additions to build out its retail network.

Across all channels, Planet originated $7.39 billion for the three months ending June 30, compared with $6.54 billion in the first quarter and $6.43 billion during the second quarter of 2022.

Retail volume, while just a tiny portion of the total at $376 million, was up 39% versus $270 million in the first quarter. For the second quarter of 2022, Planet originated $670 million in the retail channel.

However, customer retention production made up $290 million of last year's second quarter retail volume. In the current higher interest rate environment, retention volume was $156 million in the most recent period, up 78% from the first quarter's $88 million.

On June 1, Planet closed on the asset purchase of 20 branches and production personnel from Hoffman Estates, Illinois-based Platinum.

"We anticipate the additional branches and retail professionals joining Planet…will further increase our retail market share in Q3," Michael Dubeck, chairman and CEO of parent company Planet Financial Group, said in a press release. "We continue to explore additional acquisitions of right-sized, financially stable retail organizations."

Planet Financial, headquartered in Meriden, Connecticut, is privately held. It did not release profitability metrics.

The correspondent channel, which grew following the second-quarter 2022 acquisition of Home Point Capital's unit, did $7.02 billion in the most recent three months. This was 12% more than $6.27 billion in the first quarter and 22% versus $5.76 billion of mortgages purchased in the second quarter of 2022.

Planet Home was also a purchaser of mortgage servicing rights during the quarter, adding a $10 billion Ginnie Mae portfolio from Village Capital & Investment in June.

In the second half of the year, Planet Home Lending plans to actively purchase MSRs both through bulk and co-issue transactions, and is consistently reviewing brokered and private portfolio offerings, a company spokesperson added at that time.

"We are constantly scaling up and creating operational efficiencies, which increases the competitiveness of our pricing," the spokesperson said. "Planet purchases when the opportunities align and it's a win for us and the seller."

The Village deal was the primary reason Planet had a $96.94 billion MSR portfolio (including residential and commercial subservicing) as of June 30, versus $77.03 billion on March 31 and $58.69 billion on June 30, 2022.

In June, Fitch Ratings upgraded the RMBS primary subprime servicer and RMBS special servicer ratings one notch each.

"The company's management team promotes a continuous improvement culture as evident in its primary and special servicing performance metrics while also managing significant portfolio growth in the past 24 months," Fitch said. "The ratings also consider the financial condition of PHL's parent, Planet Financial."