CCC 1423 It is called the sacrament of conversion because it makes sacramentally present Jesus’ call to conversion, the first step in returning to the Father1 from whom one has strayed by sin.
It is called the sacrament of Penance, since it consecrates the Christian sinner’s personal and ecclesial steps of conversion, penance, and satisfaction.

1 Cf. Mk 1:15; Lk 15:18.