Howard will celebrate 40 years at Walker & Dunlop on November 24.
As you can see on slide three, we generated total revenues of $247 million, up 16% from the third quarter of last year and diluted earnings per share of $1.66, up 19% year-over-year.
As shown on slide four, on a year-to-date basis, of an exceedingly successful 2019, we have grown total revenues by 22% and diluted earnings per share by 24%.
For example, slide five shows W&D's performance versus the median of the S&P 600 Financials Index over the past several years.
Yet as the right side of this slide shows, the median price to earnings ratio for the S&P 600 Financials Index is 16.5, while it is 8.5 for Walker & Dunlop.
You can see on this slide that our Q1 lending was done 57% with the agencies and 43% with other capital sources.
As a result, in Q2, our agency volumes expanded to 77% of total financing, while capital from banks, CMBS and insurance companies contracted to only 23%.
75% of the $7.3 billion of debt financing we did in Q3 was with the agencies on multifamily properties, while only $1.8 billion or 25% was with banks, life insurance companies and other sources.
First, our business model and team allowed us to deploy a huge amount of agency capital during the pandemic that has driven our tremendous financial performance; and second, while deploying $1.8 billion of capital from banks, CMBS and life companies during Q3 is a significant accomplishment, we lend over $3 billion with these capital sources last year during Q3, showing the significant upside to our transaction volumes as the market normalizes.
We started the year with a very strong first quarter sales volume of $1.7 billion and then watched the market collapse in Q2, closing only $447 million of sales.
But due to our team, brand and technology investments, we saw our multifamily property sales volume rebound to $1.1 billion in Q3 as investors reentered the market with conviction.
We have a significant pipeline moving into Q4 and expect to close $2 billion to $3 billion in property sales volume in the quarter, bringing our annual total to over $5 billion, which is a significant accomplishment given the market fluctuations this year.
Winning and closing the largest multifamily financing likely to be done in 2020, the $2.4 billion Southern Management deal that we closed in Q2; was a marquee deal, where Walker & Dunlop went head-to-head against our three largest competitors and won.
Our email distribution list has expanded from 19,000 distinct email addresses at the beginning of the pandemic to over 120,000 today.
As you can see on slide seven, we have taken our market share with the GSEs from 10% last year to 13% this year.
In the third quarter, 69% of the loans we've refinanced were new to Walker & Dunlop.
69% of the loans we refinanced in Q3 2020 were not from our servicing portfolio and were either new loans from an existing Walker & Dunlop client or new loans from a new client.
And as it relates to new clients, 25% of our total financing volume in the third quarter was with new clients to Walker & Dunlop.
As evidenced by the 16% year-over-year increase in revenue during the quarter to $247 million and 19% growth in diluted earnings per share to $1.66.
In addition, return on equity for the quarter was 20%, up from 18% last year, while operating margin held steady at 28%.
Q3 adjusted EBITDA was $45.2 million, down from $54.5 million in Q3 of last year.
First, our servicing portfolio has grown by 13% over the past year and now stands at $103 billion, as you can see on slide eight.
In addition, the weighted average servicing fee on the portfolio has increased to 23.4 basis points at the end of Q3.
We earned $60 million of high-margin cash servicing fees in Q3, up 10% from last year, and those revenues will only continue to grow with the increase to both the portfolio and the weighted average servicing fee.
And finally, while we expect interest rates to remain low in the near term, any future increase in short-term rates will have a positive impact on the interest income we earned from our now $2.8 billion of escrow deposits, a balance we expect will continue growing as our overall servicing portfolio grows.
We ended the quarter with close to $300 million of cash on the balance sheet, further bolstering our already strong liquidity.
During the quarter, we repurchased 254,000 shares at an average price of $53.12 per share, utilizing $13.5 million of our $50 million authorization.
We currently have $26 million available for share repurchases to use between now and early February of next year.
And yesterday, our Board of Directors approved a dividend of $0.36 per share payable to shareholders of record as of November 13.
At the end of the quarter, we had only one $6 million Fannie Mae loan still in forbearance.
That is one loan in a portfolio of over 2,500 loans, which, by the way, we believe with our production volumes this year is now the largest Fannie Mae portfolio in the country.
Third quarter provision expense was $3.5 million and included a $2.4 million charge related to an increase to the reserve on the one loan in our interim loan portfolio that defaulted in the first quarter of last year.
The remaining $1.1 million of the quarterly provision expense was driven by the growth in the at-risk portfolio during Q3 as we did not make any changes to our loan loss assumptions during the quarter.
As detailed on slide nine, in our portfolio of 5,345 Fannie, Freddie and HUD loans, we had only nine loans in forbearance at September 30 or 0.2% of the entire agency portfolio.
After posting a gain on sale margin of 223 basis points in Q3, we expect the increase in debt brokerage volumes and continued strong agency originations to deliver a gain on sale margin in the range of 200 to 220 basis points in Q4.
And with year-to-date earnings-per-share growth of 24%, we are well on track to delivering double-digit earnings growth for the seventh year of our 10 years as a public company.
As borne out by the stats that Willy went over, related to our historical performance relative to the S&P 600 financials, our business model consistently demonstrates that it is built to sustain market downturns due to our focus on multifamily, access to countercyclical capital, and the strong credit standards that underpin our servicing portfolio; while our business also performs well when times are good as a result of our great people, strong brand and investments in growth in technology.
The first part of Vision 2020 was to grow our debt financing volume to over $30 billion by the end of 2020.
On a trailing 12-month basis, we are now at $31.4 billion of debt financing and are projecting that we end 2020 at a similar annual run rate.
As you can see on slide 11, over the past five years, we have grown annual loan originations at a 14% compound annual growth rate, and we believe we continue that growth trajectory, given the people, brand and technology we have built.
As the right-hand side of this slide shows, we have grown our servicing portfolio at a 16% compound annual growth rate, which pushed the portfolio over the $100 billion mark early in the third quarter, achieving the second component of Vision 2020.
We have doubled the size of our servicing portfolio from $50 billion to over $100 billion over the past five years and now stand as the eighth largest commercial loan servicer in the United States.
The third objective was to grow our multifamily property sales volume to over $8 billion a year.
And while we will come up short of that goal, as you can see on Slide 12, we have grown that business from $1.5 billion in 2015 to $5.3 billion for the trailing 12 months ending Q3 2020, a 28% compound annual growth rate.
The fourth component of Vision 2020 was to build an $8 billion asset management platform.
As you can see on the right-hand side of the slide, since setting our Vision 2020 objective, we have grown our AUM to $1.9 billion, and we continue to focus on building out this area of our business over the next several years.
When we established Vision 2020 in 2015, the underlying goal was to take W&D's annual revenues from $468 million to $1 billion.
And as we have seen, since we started establishing bold, ambitious five-year growth plans for Walker & Dunlop back in 2007, with our team, focus and determination, we have consistently achieved the majority of our goals.
As shown on slide 13, over the trailing 12 months, we have generated $951 million of total revenues.
And over the last two quarters, we are on a $1 billion annual run rate, an incredible accomplishment for our team.
The first component will be to become the number one multifamily lender in the country; after finishing 2019 as the fifth largest with $16.7 billion of lending volume.
JPMorgan is the largest multifamily lender at $22.7 billion of financing in 2019, with the majority of that lending done on small loans.

Summary:
As you can see on slide three, we generated total revenues of $247 million, up 16% from the third quarter of last year and diluted earnings per share of $1.66, up 19% year-over-year.
As evidenced by the 16% year-over-year increase in revenue during the quarter to $247 million and 19% growth in diluted earnings per share to $1.66.