The following is a summary of the MFA Financial, Inc. (MFA) Q1 2024 Earnings Call Transcript:
Financial Performance:
MFA Financial posted distributable earnings of $0.35 for the first quarter.
The company added $650 million of high-yielding assets, mainly from Lima One, with an average coupon rate of 10.4%.
A minor impact of higher interest rates was observed with GAAP and economic book value decreasing by 1.3% and 1.7% respectively.
MFA executed securitizations of $193 million and $365 million.
The company successfully raised $190 million through two bond issuances.
A $200 million share repurchase program was authorized and a $300 million at-the-market program was also set up.
The estimated decrease in economic book value is approximated to be 1% due to higher market interest rates post quarter-end.
Business Progress:
MFA focused on Lima One for high-yielding asset acquisitions.
They issued the fourth unrated revolving securitization of transitional loans originated by Lima One.
The company saw attractive loan opportunities and expanded their loan portfolio.
MFA displayed confidence in the company's future earnings capability, bolstered by steady net interest income and crossing the $10 billion portfolio benchmark.
The company is exploring the possibility of recycling capital by calling older securitizations in the next two-three years due to changing market conditions.
Lima One proved to be a valuable acquisition with a diverse product set and robust pipeline.
MFA announced a stock repurchase and ATM program, with no immediate use planned.
The loan extensions in their transitional book increased from 9% to 12%, which is considered a normal operational uptick.
More details: MFA Financial IR
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