Catalyzes the removal of a penultimate prolyl residue from the N-termini of peptides, such as Leu-Pro-Ala. Also shows low activity towards peptides with Ala or Ser at the P1 position. Promotes TNFRSF1B-mediated phosphorylation of MAPK8/JNK1 and MAPK9/JNK2, suggesting a function as an adapter protein for TNFRSF1B; the effect is independent of XPNPEP3 peptidase activity. May inhibit apoptotic cell death induced via TNF-TNFRSF1B signaling. Release of any N-terminal amino acid, including proline, that is linked to proline, even from a dipeptide or tripeptide. Binds 2 manganese ions per subunit. Homodimer. Interacts with TNFRSF1B/TNFR2 (activated) and TRAF2. Mainly mitochondrial. Translocates to the cytoplasm following TNFRSF1B activation. Expressed in the kidney, specifically in intercalated cells, but not in principal cells, of the distal convoluted tubule and cortical collecting duct (at protein level). Belongs to the peptidase M24B family.