Amar Patel – Chief Financial Officer Jay Bray – Chairman, President and Chief Executive Officer.

Bose George – KBW Doug Harter – Credit Suisse Henry Coffey – Wedbush Kevin Barker – Piper Jaffrey Mark DeVries – Barclays Marc Hamud – Bank of America High Yield.

Good day, ladies and gentlemen, and thank you for your patience. You’ve joined the Mr. Cooper Group’s Third Quarter 2018 Earnings Call. [Operator Instructions] As a reminder, this conference maybe recorded. I would now like to turn the call over to your host CFO, Amar Patel..

Good morning everyone, I’d like to welcome you to Mr. Cooper Group’s third quarter 2018 earnings call. Joining us today from the company is our Chairman and CEO, Jay Bray.

Before we get started, I would like to remind you that our quarterly press release and earnings supplement are available from the Investor Information section of our website www.mrcoopergroup.com. In addition, we will be make forward-looking statements during today’s call that are subject to risk and uncertainties.

Factors that may cause actual results to differ materially from expectations are detailed in our SEC filings; including the Form 8-K filed today containing our earnings release and quarterly supplement.

Information about any non-GAAP financial measures referenced, including a reconciliation of those measures to GAAP measures can also be found in the earnings release and in the quarterly supplement available on the website. Before Jay presents third quarter results, I would like to go over the changes to Mr. Cooper’s financial statement presentation.

Mr. Cooper was determined to be the accounting acquirer in the merger and Nationstar is considered the "Predecessor" and its assets and liabilities are reflected at fair values as of the merger date of July 31, 2018. Mr.

Cooper’s interim Consolidated Financial Statements for periods following the close of the merger are labeled "Successor” and reflect the acquired assets and liabilities from Nationstar.

With respect to the three months ended September 30, 2018, Company has separately provided the financial results of the Predecessor for the period from July 1, 2018 through July 31, 2018 and the results of the Successor for the period from August 1, 2018 through September 30, 2018, where both are presented under GAAP.

The presentation also includes a combined column that combines the Predecessor and Successor results referenced above with respect to the three months ended September 30, 2018.

The “Combined” column reflect non-GAAP financial measures, as a different basis of accounting was used with respect to the financial results for the Predecessor as compared to the financial results of the Successor. All this will become more meaningful when you see our 10-Q, which will be filed by the end of the week.

I’d like to now turn the call over to Jay Bray..

Thank you, Amar, and hello everyone. As you can see on the first page, this was an extraordinary quarter for our company. We completed the merger with WMIH Corp subsequently renamed the company the Mr. Cooper Group, Inc, changed the ticker symbol to COOP, and finalize the 12-for-1 reverse stock split.

In addition to closing the Assurant acquisition, we made strides in every business segment. Servicing achieved 6.5 basis points of profitability. Correspondent originations ranked among the top 10 in the industry, and Xome increased its third party revenue to 56%.

We remain committed to the market and identifying opportunities to create more shareholder value. Today we are announcing the acquisition of Pacific Union, which I will get into shortly.

We’re continuing to make strategic investments to grow all our segments, including new products and technologies like home intelligence, designed to increase customer recapture and revenue per customer. Now, let’s discuss the third quarter results.

For the quarter, we reported adjusting earnings of $54 million or $0.58 per diluted share, which is a 9% increase from the prior quarter. Servicing generated 6.5 basis points of adjusted profitability on a servicing portfolio of $500 billion. Originations earned $33 million adjusted pretax income and delivered $5.1 billion of funded volume.

Xome earned $11 million adjusted pretax income sold over 3,200 properties and increase third party revenue share from 28% to 56% at the end of the quarter. Let’s take a closer look at servicing and move to Slide 5.

Servicing had another great quarter as it again perform better than expected achieving $81 million of adjusted pretax income or 6.5 basis points of profitability in the quarter.

The increase in profitability of approximately 12% from the prior quarter was mostly from other income improving by $9 million quarter-over-quarter due to a decrease in interest expense related to MSR financing and higher float income. Prepayment and delinquency trends also continue to be favorable for the business.

We’ve ordered $37 billion throughout the quarter ending with a $514 billion portfolio with 3.2 million customers. For the fourth quarter, we already have more than $40 billion scheduled to board. These transfer should take our portfolio to $535 billion by the end of the year, which achieves our targeted 5% growth.

In addition, the opportunities for further growth are significant and we are well positioned to capture these opportunities. We remain confident in achieving adjusted profitability in excess of 6 basis points on average for the full year 2018 propelled by a lower prepayment environment and continued cost savings initiatives.

So let’s take a closer look at our platform and path for growth. If you look at Slide 6, we have a very successful track record of profitability growing the servicing portfolio. We believe no other company has done more transfers than we have and no other company has consistently growing the platform.

We completed over a 1000 transfers from virtually every large financial institution and every system that exist in the marketplace, and we’ve done so while continuing to be the low cost, lowest cost provider in the space. Our platform is self sustaining with originations flow from existing MSR and subservicing partners and bulk opportunities.

Not only replacing principal reductions, but also providing incremental growth. For 2018, we will achieve 5% growth in the servicing portfolio. For 2019, we already have visibility to at least 7% growth with what we have presently scheduled to board.

We continue to leverage our scale and servicing to capitalize on the many available market opportunities. Being the lowest cost provider provides competitive advantage to capture additional market share. Servicing is also well positioned to benefit from rising interest rates.

Rising rates lead to slower prepayment themes, which lead to improve value and profitability.

For example, as you can see on the page at 25 basis point increase in rates equates to about one – equates to about a one CPR reduction, which translates into an $80 million plus increase in the book value of the MSRS and $20 million annual pickup and profitability. Put all together this is a fantastic environment for our servicing business.

Now, let’s move to originations. Originations delivered $33 million in adjusted pretax income, which is the same as last quarter. This is an amazing accomplishment in the current environment. This was primarily driven by higher revenue margins.

In the quarter, we funded nearly 23,000 loans, totaling $5.1 billion, which was composed of $2.4 million from the consumer direct channel and $2.7 billion from the correspondent channel. In the consumer direct channel, we have improved refinance recapture rates to 57%, that’s an 8% increase quarter-over-quarter.

We’ve also seen meaningful improvements in our purchase insurance and second lien volumes quarter-over-quarter. We are using our tuna [ph] feature in the Home Intelligence app to help customers manage their personal balance sheets.

And we have a tremendous opportunity to help nearly 750,000 of our existing customers, consolidate debt and improve their cash flow. Currently over 70% of our consumer direct volume is debt consolidation solutions to our customer.

Given the current interest rate and market environment, our full target for 2018 is $115 million of adjusted pretax income in the originations business. From an industry perspective, the current rate environment has helped servicing, however originations has had its challenges.

Anyone who reviews the origination landscape can see that it’s been a tough environment for most industry participants. I’m really proud of our team for its accomplishments in this environment. Now, let’s move to Xome. This quarter Xome earned $11 million in adjusted pretax income, which was below our original target. Xome originally began taking Mr.

Cooper field service orders in the second quarter, but we discontinued the internal build out of the field services platform once we knew the acquisition Assurant was an imminent. We will continue to focus on the Assurant integration and transforming throughout 2019, growing margin and fully ramping up the capture of Mr.

Cooper’s field services opportunities by mid 2019. But in the field services ramp up aside, Xome has performed well relative to the market. Well, the market has experienced a 6% reduction in quarter-over-quarter mortgage refinance volume for the MBA and a 14% reduction in REO units quarter-over-quarter, Xome has been able to grow revenues by 6%.

In addition, Xome has dramatically shifted to third-party business post the Assurant acquisition with 49% third-party revenue for the third quarter compared to 28% third-party revenue in the prior quarter. We exited the quarter at 56% third-party revenue, and the business is posed to further growth third-party share.

The number of clients also grew significantly with the addition of Assurant’s 560 plus active clients. Before we’d have a new Assurant, I want to highlight that Xome is another area where we are making meaningful investments for our future.

First, we’ve invested in new leadership, as we’ve hired Ray Mathoda as Chief Executive Officer, responsible for Xome operations.

Ray brings the 20 year track record of success in the real estate and mortgage markets, including most recently as Co-CEO and member of the Board of Directors of Genesis Capital and serving as President of Hudson & Marshall.

Ray will oversee the growth of Xome throughout all segments, including the expansion of third-party opportunities across the exchange, title, valuation and field services businesses as well as the integration and transformation of the recently acquired Assurant Mortgage Solutions business. Now, let’s talk about Assurant, and move to Slide 9.

In August, we announced the closing of Assurant Mortgage Solutions, a strategic compliment of Xome. The company provides origination, valuations, default valuations, field services, and title to 560 plus active clients. And we have been working to integrate the platform into Xome.

The combined business will leverage the best team and technologies to offer more products to clients and become a leading provider in the mortgage services market. Ultimately, we will have a better platform with more clients, more revenues, and improve margins.

We expect Xome to be below historical levels temporarily in the very near term as we integrate and transform the title, valuation and field services businesses we acquired from Assurant. However, combining the Xome and Assurant Mortgage Services businesses absolutely the right thing to do for the long term expansion and profitability of Xome.

The Assurant acquisition and related activities are currently at or ahead of our plans. And now let’s move to our latest acquisition. Today, we are excited to announce that we have entered into an agreement to acquire Pacific Union financial. Pacific Union is a leading originator with a servicing portfolio of approximately $25 billion.

Specifically integration of the platform enables Mr. Cooper to expand his presence and correspondent and wholesale originations with delegated and non-delegated product offerings and it supports Mr. Cooper’s expansion into non-QM.

The company brings over 700 active clients and the business is quite complimentary as there’s only about 20% overlap with Mr. Cooper’s existing clients. We estimate the incremental annual originations volume potential is in excess of $10 billion with over 80% of that volume being purchase loans.

Subject to regulatory approvals, we anticipate closing in the first quarter of 2019 at which time we will walk them Pacific Union team members to Mr. Cooper and board approximately $25 billion of servicing to our platform. So let’s move to Q4 and beyond. While the third quarter was a great success, I’m even more excited about what’s to come.

For servicing, our focus continues to be growing our servicing portfolio profitably. We are exceeding our growth target for this year and we have already achieved 7% growth for next year with increased originations, volume from our existing partners and the servicing from Pacific Union.

And I am pleased with the progress we have made so far in project Titan. We remain focused on improving the customer experience while bending the cost curve. For 2019, we expect servicing profitability to improve due to a combination of higher revenues and greater efficiencies from project Titan.

I firmly believe that we have unique technology products and tools to help customers manage their personal balance sheet. The integration of Pacific Union and its 700 plus active clients is expected to build on our platform capabilities and provide incremental origination volume of $10 billion plus.

On the Xome front, we are aiming to continually increase market share across all segments. Our integration of Assurant is underway and unlocking the platforms full potential continues to be our focus in 2019. And we remain committed to creating shareholder value through our disciplined capital management strategies.

I’m truly excited about the future of our differentiated platform and we look forward to profitably growing our business in a prudent manner that benefits our customers, our team members and our shareholders. And with that, I’ll now hand it back over to the operator for Q&A..

[Operator Instructions] Our first question comes from the line of Bose George of KBW. Your line is open..

Hey guys, good morning. First question is just on the Pacific Union acquisition.

Is there much of a cash outlay for the origination platform or is that more of an earn-out? And then for the MSR part that you’re going to fund that with cash or just how’s that going to happen?.

Sure. I mean, for the – we’re looking at, it’s a total company acquisition. The primary purchase price is related to the assets of the company, which is primarily the MRSs.

We will be acquiring that and then funding it with normal kind of facilities or co-investment deals that we do with normal transactions, the bulk of the purchase price is related to the assets of the company..

Okay. And then just a couple of accounting questions on the transaction.

Post the deal, what was the size of the DTA valuation allowance?.

Right on merger it was close to $990 million..

Actually not the DTA, but….

He is asking the allowance ..

Yes, just the allowance. Yeah..

For the full value is $1.26 billion..

$1.26 billion. Okay.

So just that minus the $934 million?.

Correct? Yeah. .

Okay.

And then in terms of the expenses to $148 million, was that all deal related? And are there any deal related to expenses next quarter or is that done now?.

No, that is done. That is done. Obviously this was a transition quarter with a merger, but all the purchase price accounting is completed, and there is still a window where there may be some adjustments, we have about a year window to complete that, but we feel pretty good about where we’ve ended up.

So unless there’s any other adjustments there, there’s not going to be any other merger related expenses coming through the P&L..

Yes, just from a GAAP standpoint, you have a year to true it up if you will, but we don’t expect anymore to merger related to expenses, and I’m doubtful have any more purchase accounting adjustments. But for GAAP purposes, you do have a year..

Okay. And then just one last one from me.

On the MSR mark, the $49 million, how much of that was driven by rates?.

Almost all of it..

Yeah. Almost all of it..

Yes..

Okay. So. Okay, great. Thanks..

Thank you. Our next question comes from the line of Doug Harter of Credit Suisse. Your question please..

Thanks. Jay, you mentioned as you look for towards 2019, now servicing profitability should be improved.

Just – I guess trying to get a sense, is that from kind of the full year north of six basis points or is that from the six and a half basis point level that you’ve achieved in the third quarter?.

Well, it’s definitely from the full six, right. But I think, we do have momentum. We’ve kind of locked in the growth on the portfolio like we shared in the comments and then we also, still feel very confident in our – what we call project type initiative where we’re looking at revenue and has been seen in cost reductions.

So I think for the year next year certainly we would expect to be above six and a half..

Great. And then as you’re looking at obviously already have kind of the 7% growth locked in for next year. Yes.

I guess can you talk about kind of what that pipeline of additional opportunities looks like? There are a lot of other acquisitions like Pacific Union out there or larger transactions, I guess, how do you view the pipeline?.

I think it’s strong. I mean, I think we’re going to be selective and really take a hard look.

I mean, if you think about what we can do with Titan, if you think it will, what we can do now with Pacific Union and our existing origination platform, there’s a lot of growth and there’s a lot of opportunity there to improve core earnings, not dimension what we think we can do with Xome and Assurant over time. So, I think the pipeline is large.

I think there’s, a lot of consolidation opportunities that they can present themselves. There are some larger strategic opportunities as well. But we’re going to be very mindful of – and selective on what we do. I think as we kind of enter 2019, we feel – we feel actually great.

I mean, given that we’ve locked in kind of a pretty strong growth rate already, given that we’ve got pack you and some things I think that’ll be very important on the origination side. So we’re just, we’re not going to chase things, we’re going to be very disciplined in that approach and I think that’s the way you should think about it..

Thank you, Jay..

Thank you. Our next question comes from Henry Coffey of Wedbush. Your question please. .

Yes. Good morning everyone. Very during interesting quarter. So, you didn’t make comment on mortgage that you would expect it to be at about $115 million. This year Xome should be a little light because of the expected the related integration cost, but obviously an important merger.

And then on the servicing front with servicing at six and a half basis points, now should we assume that the contribution from that will be a little higher or you didn’t just going back to some of the hard numbers you’ve given us before in terms of guidance for 2018?.

Yes.

The short answer is yes, Henry, do you think you’ll see some offset from origination from Xome within the servicing?.

Yes. These own factors come in, right? Because seasonal factors prepaids are typically down and also means the lower origination volume as well..

Right? Right. We’re figuring that in there.

And then in terms of putting this project Titan, as you look at your technology options and now with the acquisition, do you start changing technology vendors? Do you start developing your own mortgage origination technology? And I know you’re big Ellie users and Ellie Mae is a very, very popular of technology in the correspondent business, because of its ability to access small customers.

So when you look at what you might be able to accomplish in terms of operating efficiency with your existing mortgage technology, what are your thoughts about where you might take that?.

Yes, I think it’s unlikely we build our own, in the near term. I think when we look at the different pack you has, a different provider than we do on the correspondent side. So we’re going to take the time to evaluate that and select the best platform. They have some great portals.

We think they’re actually best-in-class and so I think we will be picking up some technology there that’s going to be great for our customers and great for us, and frankly I think will drive efficiencies as well.

But I think we’re going to – the short answer is, we’re going to take the next 90 days and really do a deep dive into their platform, our platform and make some decisions and unlikely we build our own, but we try to take the best of breed and kind of move forward from there..

How equity line of credit? I finally have heard people start talking about that, beginning of the years like – anything, obviously I mean, I did the analysis with my own mortgage broker, he was like, yes, you don’t want to do a cash out, but there are so many people out there with sub 4% rates were a cash out refinance.

It’s just not the right product. And so now that’s going to open up the home equity line of credit door, which was a problem, was great asset, a great opportunity, then it was a problematic loan. And then, so where are we today with that? Whereas Mr.

Cooper today with that, how big of an opportunity is that for people of what are your thoughts in terms of what you might be able to accomplish on that front?.

Well, I think it’s a massive opportunity. I mean if you look, if we just stick with the cash out refi opportunities first, where someone can refi their first lien – we have 750,000 customers that we think we can say over $500 a month, and a debt consolidation makes a ton of sense for them.

And so that I would say is first the product that and now 75% of what we’re doing on the – in our direct-to-consumer or refi a is cash out, you debt consolidation loans. And so, I think that’s here to stay and I think it’s going to grow. And I think we have a massive opportunity there.

We have a second lien product that actually is growing pretty significantly now. Again, the numbers are small compared to our overall origination’s, but we do think that’s a product that customers are going to won and they are kind of demanding.

And really Henry gets back to kind of gets back to your technology question, I mean, the way to think about our technology platform is the Ellie Mae’s and some of the others are kind of just the behind the scenes, foundation. We’re building tools and an ecosystem, if you will around that.

That LOS [ph], that’s very customer enabled, right? It’s a great customer experience, where you’ve heard us talk about home intelligence and you’ve heard us talk about my way, my way is our version of rocket mortgage, home intelligence is going to be our app for all of our existing customers to really go in and look at their home.

It’s going to be home centered and it’s going to have a tuna feature that’s going to allow them to really, go and look at the liability side of their balance sheet and then provide them the best solution. And that best solution could be, a cash out debt consolidation loan like we talked about.

It could be a second lien, could be a personal loan, could be a home equity line of credit. And so we’re going to have all those products and available for the customer and find the best solution for them. So that’s how we’re thinking about it. I do think it is massive opportunity and I think we’re well positioned for it..

Great. Thank you. Interesting quarter..

Thank you..

Thank you. Our next question comes from the line of Kevin Barker of Piper Jaffrey. Your question please..

Good morning.

Could you talk about what the amortized value of the MSR is versus the fair value today? And then the portion of the amortization expense associated with the fair value mark up with the MSR this quarter?.

Yes. Sure, Kevin. The difference is between the fair value and the amortized amount is approximately about $42 million. And right now there is about a 45 basis points to 48 basis point differential between the fair value of the MSRs relative to our cost basis..

Okay. Thank you. And then, in regards to Pacific Union, you said you were just buying the assets, right? So you’re going to finance the transaction through yourself, right? So you just basically buying the assets then either going to issue debt or use a co-funding to do it.

Would you just provide a little more detail on how you’re going to finance that transaction?.

Well, whereby we’re actually buying the company, so it’s not just the assets we’re buying the company and the assets will be financed predominantly we co-invest. So we’re – we have our partners as we talked about in the past, but there won’t be any additional debt if you will – will be co-invest..

So you will have your cash and then the co-investments from other companies in order to basically supplement whatever you’re paying for it.

Is that a good way to think that?.

That’s right. That’s correct..

Okay.

And then, what is the capitalized value of the MSRs that you’re acquiring associated with Pacific Union?.

I’m not sure we can get into those details. I mean, that is, we’re buying a $25 billion portfolio, which we believe in market price for the assets. The portfolio itself is fairly recently in originated. It’s about two years old..

Okay.

So low CPR, relatively new MSR, is that I’m going to assume most of them are government insured?.

That is correct..

Okay, thank you. And then, in regards to the adjustments that you laid out, the $148 million that you said a merger related, there was two big numbers. There’s one on the servicing side and then there was another on the corporate side.

Could you detail exactly how much was, related to the merger with WMIH and the merger with the insurance [ph] and how that, how that plays out and what was any of that related to DTA?.

Sure. Nothing was related to DTA. Items related to Assurant are essentially in – they’re not – they’re not merger related adjustments.

And that ends up being $5 million of the Xome adjustments, $5 million $7 million that we’ve listed for Xome, but everything else, $131 million that we’ve outlined is all for merger related items having to do with assessment of the balance sheet at the time of the merger and the purchase price accounting that is entailed with that.

And then so we had to fix purchase price for WMIH had a fixed purchase price of acquiring the company and in that there was an assessment of the assets and liabilities as of the merger date of 7/31.

When that happens, most of these items go through a balance sheet and re-class, but some others may go through a P&L item through the predecessor, which is Nationstar. And so that gets to that $131 million adjustment.

At the end the balance purchase price is what it is and the balance sheet is what it is? It’s just a matter of how you kind of get to that ending spot..

Okay.

And so was any of that related to interest expense of the issues with that or the prepayment at that, or was this more looks like fees and other adjustments associated with merger?.

Those fees, lot of those fees there is also related to some call to prior debt. But that was part of the things that we enumerated when we outlined the transaction..

Got It. Okay. And then the DTA declined by $81 from the pro forma number in the second quarter.

Was that due to lower valuation allowance or expectations for future use of the DTA?.

No, I think that’s – we fully expect to utilize that DTA, particularly through the term, which extended beyond 2032, when you get to the final booking and the valuation allowance, which is essentially got to a number that was just slightly below the $1billion that we had out there..

Okay. And then, on your adjusted number, you had roughly $5 million worth of taxes in your adjusted EPS, which implies roughly 5% tax rate.

Is that your expectation that you have on a GAAP basis or is that what you’re going to use for an adjusted number going forward?.

We expect to use about a 3% number for the adjusted basis. From a GAAP basis, it will be the full rate, which will be approximately 24%..

Okay. Thank you for taking my question..

[Operator Instructions] Our next question comes from the line of Mark DeVries of Barclays. Your question please..

Yes, thanks. I’m sorry if I missed this. Is there any color you can give us on your expectations for a creation from this Pacific Union deal and any color you can give on – on how the margins the origination servicing businesses with that compared to what you’ve got and any kind of opportunities for efficiencies down the road? Thanks..

Yes. On the origination side, I think their current run rate is, call it $15 million of originations. As we – we’re forecasting I think somewhere between $10 million and $15 million just to be conservative. And today they’re – I think they’re around 40 basis points in profitability. We’re, slightly south of that obviously..

On correspondent side..

On correspondent, yes, yes..

Total work close to 60 basis points on average. That’s the combination of consumer direct and correspondent, but their margin on the correspondence given the clients they have, the products they do is that’s higher than our business..

Okay.

And on the servicing side?.

On servicing side, like you’re saying it says market type transaction. Most of the portfolio is government and we look at all deals to be accretive to us, and we try to hit even though low to mid teens type of returns and we think we’ve that with this deal..

Okay. Follow-up question on the pipeline. I mean, I think there was, there was at least one deal out there that was materially bigger than, than this. I’m just curious, and maybe this is a naïve question given how many balls in the air though.

What the Pacific Union does for your appetites and kind of a near term to do any other kind of acquisitions?.

Yes. I think, like we said earlier, we’re going to be pretty selective and as we think about other opportunities, the Pacific Union transaction itself – it’s 25 – if you think about it from a servicing standpoint, it’s fairly simple. It’s $25 billion of a portfolio size and we’ve done a number of those size transaction.

So we think it’s – it’s not overly complicated there. On the origination it is more complicated from an integration standpoint, but we’ve been working with these guys for 90 days now and Tony Ebers team or – all over and quite good at integration and we have time between signing and closing as well.

So I don’t feel like it certainly doesn’t put us on the sidelines by any stretch of the imagination.

but I think it’s, again, when we think about new opportunities, we, we really, we like – we like packy platform and then we actually, we think it’s going to be very creative in the sense that, more volume, they have 700 clients – and there’s very little overlap and so we think it’s 80% purchase.

So we really, we love the origination platform and we think the servicing is, is very complimentary to what we have. So that type of acquisition I think makes a ton of sense and we’re going to be selective on others. But clearly we’re not – we’re not constrained from looking at other things..

Okay, that’s helpful. And then finally on Assurant.

Could you talk a little bit more about your plans to improve margins there and get the margins and that segment of the business up to kind of where you were with Xome prior to the acquisition?.

Yes. Assurant is, if you go back to kind of their strategy, they acquired, I think it was four different companies, three to four different companies. And they were own different platforms and so, and they – they were at the time of our acquisition, kind of going through a strategic review on how to consolidate those. So we stepped in.

We are now assessing the platforms trying to determine the best technology on the field services side. Clearly we’ve already made the decision to not grow that de novo and they leverage what they have, but it’ll take us, I think a couple of quarters to get that integrated and to get back to the margins that we would expect to be at.

So it’s going to a little – take a little bit of time. I think the great news, again, they have an number of clients, it takes our revenue, doubles our revenue and then some and so I think that’s a good thing. And then with Ray, she is all over this and is doing a great job of integrating and laying out the plan.

So, but it’s still, it’s, it’s a complicated – multiple platforms. It’s going to take us a couple of quarters to get to where we want to be..

Okay, great. Thank you..

Thank you. Our next question comes from the line of Marc Hamud of Bank of America High Yield. Your line is open. .

Thanks, Jay and Amar. I had two questions.

On Pacific Union, could you give any fire points on the mix of types of servicing and origination like Fannie, Freddie, and Ginnie?.

It’s predominantly government. I don’t know Amar, if you have the actual percentages..

Right. The portfolio is predominantly government. On the origination type. There is a mix between agency and government, but it’s predominantly, I believe it’s 70% or 80%government..

Thanks.

Can you give us a sense for their servicing profitability? or whether or not they were servicing their own or if they sub service that?.

I think they were servicing on their own, on their own platform and obviously their size is $25 billion. We’ve got scale and efficiency on the $500 billion portfolio and so we’ll achieve nearly a lot of efficiencies there..

Got it.

And then lastly, in the past, there was a $30 million of annualized corporate savings from the 2017 number, but I didn’t see that repeated anywhere in the release today? Can you give us an update on where you see corporate expense savings going?.

I’ll jump in and, let Amar correct me. I think $30 million, it was $15 million in a corporate interest expense save because as we entered the year, our plan was to continue to deliver and pay interest or pay debt down. Therefore less interest expense and $15 million was true kind of hard cost reductions and spin saves.

We clearly are ahead of the $15 million on the expense side where we’re heads and – and overall spin. On the debt, obviously the picture has changed, right? We, as part of the merger, we took on more debt.

So that piece it’s kind of a fresh day for that and our debt expense clearly as you guys know and you know, is going up given the additional debt expense.

But overall, as we think about corporate, – I think our teams had done a good job of hitting the numbers that we outlined in exceeding those and as we typically do, we’re know we’re going through this process now where we take a hard look at a corporate experience throughout the company.

So I think there will be some additional opportunities there, but we definitely hit what we had expected to for the year. From kind of an expense reduction standpoint excluding the debt piece. .

Got it. Thanks for clarifying that. Thanks, Jay and Amar..

Thank you. At this time, I’d like to turn the call back over to the chairman and CEO, Jay Bray for any closing remarks, sir..

Thank you guys. I really appreciate your time and look forward to chatting further. Have a great day. .

Thank you sir. Ladies and gentlemen, this concludes today’s conference. Thank you for your participation and have a wonderful day. You may disconnect your lines at this time..