Exhibit 99.1
New York Mortgage Trust Reports Second Quarter 2006 Results
| · | Consolidated net income of $0.01 per share for the quarter ended June 30, 2006 as compared to a net loss of $0.10 per share for the immediate preceding quarter ended March 31, 2006 and net income of $0.03 per share for the quarter ended June 30, 2005. |
| · | REIT (Mortgage Portfolio Management segment) earnings of $0.13 per share for the quarter ended June 30, 2006 as compared to net income of $0.11 per share for the immediate preceding quarter ended March 31, 2006 and net income of $0.19 per share for the quarter ended June 30, 2005. |
| · | Mortgage Lending segment net loss of $0.12 per share for the quarter ended June 30, 2006 as compared to a net loss of $0.21 per share for the immediate preceding quarter ended March 31, 2006 and a net loss of $0.16 per share for the quarter ended June 30, 2005. |
| · | Board of Directors declared a second quarter 2006 cash dividend of $0.14 per share. |
NEW YORK, NY August 7, 2006 - New York Mortgage Trust, Inc. (NYSE: NTR), a self-advised residential mortgage finance company organized as a real estate investment trust (“REIT”) for federal income tax purposes, today reported results for the quarter ended June 30, 2006.
Comparison of the Quarters Ended June 30, 2006 and 2005
| · | Quarterly loan origination volume of $741.3 million for the quarter ended June 30, 2006 as compared to $613.8 for the immediate preceding quarter ended March 31, 2006 and $939.7 million for the quarter ended June 30, 2005. |
| · | Consolidated net income of $178,000 for the quarter ended June 30, 2006 as compared to a net loss of $1.8 million for the immediate preceding quarter ended March 31, 2006 and net income of $546,000 for the quarter ended June 30, 2005. |
| · | REIT (Mortgage Portfolio Management segment) earnings of $2.4 million for the quarter ended June 30, 2006 as compared to net income of $2.0 million for the immediately preceding quarter ended March 31, 2006 and net income of $3.5 million for the quarter ended June 30, 2005. |
New York Mortgage Trust Reports Second Quarter 2006 Results
Page 2
Second Quarter Results
For the quarter ended June 30, 2006, the Company’s Mortgage Portfolio Management segment (REIT operations exclusive of its taxable REIT subsidiaries) reported net revenues of $3.1 million and net income of $2.4 million, or $0.13 per share.
The Company’s Mortgage Lending segment (the Company’s wholly owned taxable REIT subsidiaries or “TRS”) reported net revenues of $9.4 million and a net loss of $2.2 million for the quarter ended June 30, 2006. On a consolidated basis, the Company reported net income of $0.2 million for the quarter ended June 30, 2006.
Comments from Management
Steven B. Schnall, Chairman, President and Co-Chief Executive Officer, commented, “Our second quarter operating results represent an improvement over the previous quarter in both our Mortgage Portfolio Management and our Mortgage Lending segments. The improvement in our Mortgage Portfolio Management segment was largely the result of an asset repositioning initiatives which occurred in the first quarter of 2006. Despite this progress, our second quarter results in both our Mortgage Portfolio and Mortgage Lending segments reflect continued pressure from the impact of compressed net interest margins resulting from the flat yield curve - this is particularly true for our Mortgage Portfolio Management segment which has over $1.3 billion invested in mortgage securities and loans held in securitization trusts. During the quarter, though, we did see a slight improvement in net interest margins to 78 basis points as compared to 71 basis points from the immediately preceding first quarter of 2006. Additionally, our net duration gap between the average lives of our assets and our liabilities declined slightly to approximately nine months which is an improvement from the first quarter of 2006. Also, indicative of the credit strength of our portfolio is the fact that loan delinquencies greater than 90 days represent only 0.43% of portfolio value - with no losses projected.”
Mr. Schnall added, “The improvement in our Mortgage Lending segment’s earnings was primarily attributable to a 21% increase in our mortgage origination volume from the first quarter of 2006. Notwithstanding this improvement, our second quarter results in our Mortgage Lending segment reflect weaker than anticipated origination volumes and continued pricing pressure on premiums earned on loans sold to third parties. Specifically, we experienced a 73 basis point reduction in gain on sale premiums for the second quarter of 2006 relative to the second quarter of 2005. Fortunately, we are currently seeing signs of some market stabilization - gain on sale premiums earned on loans originated by our TRS and sold to third parties declined by only approximately 9 basis points for the second quarter of 2006 relative to the first quarter of 2006. Despite these negative market factors, the Mortgage Lending segment showed second quarter 2006 net earnings improvement of approximately $700,000 as compared to the second quarter of 2005. It should also be noted that various cost cutting initiatives undertaken at the end of the first quarter of 2006 were fully implemented in the second quarter. These initiatives include expense reductions to general and administrative expense, including non-commission and non-sales payroll, with savings up to approximately $900,000. Lastly, we are very excited to have announced last week the launch of a new, innovative and unique mortgage loan product - the “Homeowner Protection Loan,” a monthly Adjustable Rate Mortgage (“ARM”) with a 10-year interest rate cap at 6.99% and no negative amortization. We believe that this new product will be compelling for consumers in that it’s maximum rate for the first 10-years, which is capped of 6.99%, is approximately the same as a fixed rate or comparably termed hybrid ARM loan, but can decrease in a declining rate environment, thus largely eliminating the need for a borrower to refinance. While it is too early to report actual results, we are confident that this new product will gain meaningful traction, thereby increasing our origination volumes and our operating results in future quarters.”
New York Mortgage Trust Reports Second Quarter 2006 Results
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A breakdown of the Company’s loan originations by payment stream for the quarter ended June 30, 2006 follows:
MORTGAGE LOAN ORIGINATION SUMMARY
For the Second Quarter Ended June 30, 2006
(Dollar amounts in thousands) | Number of Loans | Par Amount | % of Total | |||||||
Payment Stream | ||||||||||
Fixed Rate | ||||||||||
| FHA/VA | 170 | $ | 28,891 | 3.9 | % | |||||
| Conventional Conforming | 1,556 | 277,639 | 37.5 | % | ||||||
| Conventional Jumbo | 131 | 80,752 | 10.9 | % | ||||||
| Total Fixed Rate | 1,857 | 387,282 | 52.3 | % | ||||||
ARMs | ||||||||||
| FHA/VA | 7 | 1,697 | 0.2 | % | ||||||
| Conventional | 1,021 | 352,363 | 47.5 | % | ||||||
| Total ARMs | 1,028 | 354,060 | 47.7 | % | ||||||
| Total | 2,885 | $ | 741,342 | 100.0 | % | |||||
Loan Purpose | ||||||||||
| Conventional | 2,708 | $ | 710,755 | 95.9 | % | |||||
| FHA/VA | 177 | 30,587 | 4.1 | % | ||||||
| Total | 2,885 | $ | 741,342 | 100.0 | % | |||||
Documentation Type | ||||||||||
| Full Documentation | 1,508 | $ | 393,105 | 53.0 | % | |||||
| Stated Income | 540 | 170,891 | 23.1 | % | ||||||
| Stated Income/Stated Assets | 285 | 74,130 | 10.0 | % | ||||||
| No Documentation | 394 | 70,556 | 9.5 | % | ||||||
| No Ratio | 102 | 22,934 | 3.1 | % | ||||||
| Stated Asset | 6 | 634 | 0.1 | % | ||||||
| Other | 50 | 9,092 | 1.2 | % | ||||||
| Total | 2,885 | $ | 741,342 | 100.0 | % | |||||
New York Mortgage Trust Reports Second Quarter 2006 Results
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A breakdown by credit quality of the Company’s loan originations for second quarter 2006 follows:
Number of Loans | Aggregate Principal Balance ($ in millions) | Percentage Of Total Principal | Weighted Average Interest Rate | Average Principal Balance | Weighted Average | |||||||||||||||||
LTV | FICO | |||||||||||||||||||||
| ARM | 1,021 | $ | 352.3 | 47.5 | % | 6.83 | % | $ | 345,116 | 72.2 | 711 | |||||||||||
| Fixed-rate | 1,687 | 358.4 | 48.4 | % | 7.20 | % | 212,443 | 75.2 | 713 | |||||||||||||
Subtotal-non-FHA | 2,708 | 710.7 | 95.9 | % | 7.02 | % | 262,465 | 73.7 | 712 | |||||||||||||
| FHA - ARM | 7 | 1.7 | 0.2 | % | 5.60 | % | 242,250 | 95.8 | 608 | |||||||||||||
| FHA - fixed-rate | 170 | 28.9 | 3.9 | % | 6.32 | % | 169,950 | 93.3 | 662 | |||||||||||||
Subtotal - FHA | 177 | 30.6 | 4.1 | % | 6.28 | % | 172,809 | 93.4 | 659 | |||||||||||||
| Total ARM | 1,028 | 354.0 | 47.7 | % | 6.82 | % | 344,416 | 72.3 | 711 | |||||||||||||
| Total fixed-rate | 1,857 | 387.3 | 52.3 | % | 7.13 | % | 208,553 | 76.5 | 709 | |||||||||||||
Total Originations | 2,885 | $ | 741.3 | 100.0 | % | 6.99 | % | $ | 256,964 | 74.5 | 710 | |||||||||||
| Purchase mortgages | 1,792 | $ | 434.7 | 58.7 | % | 7.10 | % | $ | 242,591 | 78.7 | 720 | |||||||||||
| Refinancings | 916 | 276.0 | 37.2 | % | 6.88 | % | 301,345 | 65.8 | 698 | |||||||||||||
Subtotal-non-FHA | 2,708 | 710.7 | 95.9 | % | 7.02 | % | 262,465 | 73.7 | 712 | |||||||||||||
| FHA - purchase | 108 | 19.2 | 2.6 | % | 6.23 | % | 178,163 | 96.6 | 669 | |||||||||||||
| FHA - refinancings | 69 | 11.4 | 1.5 | % | 6.38 | % | 164,429 | 88.0 | 642 | |||||||||||||
Subtotal - FHA | 177 | 30.6 | 4.1 | % | 6.28 | % | 172,809 | 93.4 | 659 | |||||||||||||
| Total purchase | 1,900 | 453.9 | 61.3 | % | 7.07 | % | 238,929 | 79.4 | 718 | |||||||||||||
| Total refinancings | 985 | 287.4 | 38.7 | % | 6.86 | % | 291,754 | 66.7 | 696 | |||||||||||||
Total Originations | 2,885 | $ | 741.3 | 100.0 | % | 6.99 | % | $ | 256,964 | 74.5 | 710 | |||||||||||
Note: FHA originations are Streamlined Refinance mortgages with low average balances. All FHA loans are and will continue to be sold or brokered to third party investors.
Investment Activity
As of June 30, 2006, the Company’s portfolio of investment securities totaled $652.7 million and had a weighted average purchase price of 100.36. Approximately 34% of the securities purchased have rate resets in less than six months, 8% reset in six to 24 months and the remaining 58% reset in less than five years. In addition, loans held in securitization trusts totaled $690.5 million and had an average origination value/purchase price of 100.66. Approximately 37% of loans held in the portfolio have interest rate resets of less than 24 months, 2% have resets between 24 months and 36 months and the remaining 61% have resets greater than 36 months. The investment securities and the loans held in securitization trusts are financed in part with debt totaling $1.0 billion at June 30, 2006.
The net interest margin on the Company’s mortgage portfolio investments for the three-month period ended June 30, 2006 averaged 78 basis points, up from 71 basis points in the first quarter of 2006. This increase in spreads is reflective of the redeployment of proceeds from the sale of certain of our investment securities during the first quarter 2006.
The following table summarizes the Company’s investment portfolio of residential mortgage-backed securities and loans owned at June 30, 2006, classified by relevant categories:
Par Value | Coupon | Carrying Value | Yield | ||||||||||
| Agency REMIC floaters | $ | 191,667,510 | 6.52 | % | $ | 191,198,886 | 6.70 | % | |||||
| Private label floaters | 29,310,487 | 6.06 | % | 29,222,341 | 6.21 | % | |||||||
| Private label ARMs | 312,618,258 | 4.82 | % | 306,714,267 | 5.55 | % | |||||||
| Agency ARMs | 100,235,042 | 6.09 | % | 100,649,393 | 6.16 | % | |||||||
| NYMT retained securities | 26,049,816 | 5.66 | % | 24,889,263 | 7.73 | % | |||||||
| Loans held in securitization trusts | 685,955,839 | 5.19 | % | 690,501,530 | 6.15 | % | |||||||
| Total/Weighted Average | $ | 1,345,836,952 | 5.39 | % | $ | 1,343,175,680 | 6.12 | % | |||||
New York Mortgage Trust Reports Second Quarter 2006 Results
Page 5
Conference Call
On Tuesday, August 8, 2006 at 10:00 a.m. Eastern time, New York Mortgage Trust's executive management will host a conference call and audio webcast highlighting the Company's second quarter financial results. The conference call dial-in number is 303-262-2140. A live audio webcast of the conference call can be accessed via the Internet, on a listen-only basis, at http://www.earnings.com or at the Investor Relations section of the Company's website at http://www.nymtrust.com. Please allow extra time, prior to the call, to visit the site and download the necessary software to listen to the Internet broadcast. The online archive of the webcast will be available for approximately 90 days.
About New York Mortgage Trust
New York Mortgage Trust, Inc., a real estate investment trust (REIT), is engaged in the origination of and investment in residential mortgage loans throughout the United States. The Company, through its wholly owned taxable REIT subsidiary, The New York Mortgage Company, LLC (“NYMC”), originates a broad spectrum of residential loan products with a focus on high credit quality, or prime, loans. In addition to prime loans, NYMC also originates jumbo loans, alternative-A loans, sub-prime loans and home equity or second mortgage loans through its retail and wholesale origination branch network. The Company's REIT portfolio is comprised of securitized, high credit quality, adjustable and hybrid ARM loans, the majority of which, over time, will be originated by NYMC. As a REIT, the company is not subject to federal income tax provided that it distributes at least 90% of its REIT taxable income to its stockholders.
For Further Information
| AT THE COMPANY | AT FINANCIAL RELATIONS BOARD |
| Michael I. Wirth, Chief Financial Officer | Joe Calabrese (General) 212-827-3772 |
| Phone: 212-634-2342 | Julie Tu (Analysts) 212-827-3776 |
| Email: mwirth@nymtrust.com |
This news release contains forward-looking statements that predict or describe future events or trends. The matters described in these forward- looking statements are subject to known and unknown risks, uncertainties and other unpredictable factors, many of which are beyond the Company's control. The Company faces many risks that could cause its actual performance to differ materially from the results predicted by its forward- looking statements, including, without limitation, the possibilities that a rise in interest rates may cause a decline in the market value of the Company's assets, a decrease in the demand for mortgage loans may have a negative effect on the Company's volume of closed loan originations, prepayment rates may change, borrowings to finance the purchase of assets may not be available on favorable terms, the Company may not be able to maintain its qualification as a REIT for federal tax purposes, the Company may experience the risks associated with investing in real estate, including changes in business conditions and the general economy, and the Company's hedging strategies may not be effective. The reports that the Company files with the Securities and Exchange Commission contain a fuller description of these and many other risks to which the Company is subject. Because of those risks, the Company's actual results, performance or achievements may differ materially from the results, performance or achievements contemplated by its forward-looking statements. The information set forth in this news release represents management's current expectations and intentions. The Company assumes no responsibility to issue updates to the forward-looking matters discussed in this news release.
FINANCIAL TABLES FOLLOW
NEW YORK MORTGAGE TRUST, INC. AND SUBSIDIARIES
CONSOLIDATED STATEMENTS OF OPERATIONS
(Dollar amounts in thousands, except per share data)
(unaudited)
For the Six Months Ended June 30, | For the Three Months Ended June 30, | ||||||||||||
2006 | 2005 | 2006 | 2005 | ||||||||||
| REVENUE: | |||||||||||||
| Interest income: | |||||||||||||
| Investment securities and loans held in securitization trusts | $ | 33,052 | $ | 27,081 | $ | 15,468 | $ | 14,218 | |||||
| Loans held for investment | — | 3,605 | — | 1,944 | |||||||||
| Loans held for sale | 8,275 | 6,100 | 3,233 | 3,507 | |||||||||
| Total interest income | 41,327 | 36,786 | 18,701 | 19,669 | |||||||||
| Interest expense: | |||||||||||||
| Investment securities and loans held in securitization trusts | 26,438 | 19,339 | 12,359 | 10,719 | |||||||||
| Loans held for investment | — | 2,545 | — | 1,401 | |||||||||
| Loans held for sale | 5,947 | 3,843 | 2,632 | 1,995 | |||||||||
| Subordinated debentures | 1,779 | 494 | 894 | 416 | |||||||||
| Total interest expense | 34,164 | 26,221 | 15,885 | 14,531 | |||||||||
| Net interest income | 7,163 | 10,565 | 2,816 | 5,138 | |||||||||
| OTHER INCOME (EXPENSE): | |||||||||||||
| Gain on sales of mortgage loans | 10,051 | 12,649 | 5,981 | 8,328 | |||||||||
| Brokered loan fees | 6,270 | 4,534 | 3,493 | 2,534 | |||||||||
| (Loss) gain on sale of current period securitized loans | (747 | ) | — | 26 | — | ||||||||
| Gain on sale of securities and related hedges | — | 921 | — | 544 | |||||||||
| Realized loss on investment securities | (969 | ) | — | — | — | ||||||||
| Miscellaneous income (expense) | 267 | 104 | 148 | (10 | ) | ||||||||
| Total other income | 14,872 | 18,208 | 9,648 | 11,396 | |||||||||
| EXPENSES: | |||||||||||||
| Salaries and benefits | 12,342 | 16,572 | 6,001 | 9,430 | |||||||||
| Brokered loan expenses | 4,935 | 4,206 | 2,767 | 2,686 | |||||||||
| Occupancy and equipment | 2,615 | 3,716 | 1,289 | 1,582 | |||||||||
| Marketing and promotion | 1,216 | 2,590 | 429 | 1,190 | |||||||||
| Data processing and communications | 1,414 | 1,190 | 753 | 672 | |||||||||
| Office supplies and expenses | 1,038 | 1,258 | 433 | 685 | |||||||||
| Professional fees | 2,531 | 1,846 | 1,250 | 1,102 | |||||||||
| Travel and entertainment | 283 | 446 | 101 | 230 | |||||||||
| Depreciation and amortization | 1,086 | 767 | 521 | 424 | |||||||||
| Other | 772 | 553 | 405 | 177 | |||||||||
| Total expenses | 28,232 | 33,144 | 13,949 | 18,178 | |||||||||
| LOSS BEFORE INCOME TAX BENEFIT | (6,197 | ) | (4,371 | ) | (1,485 | ) | (1,644 | ) | |||||
| Income tax benefit | 4,579 | 4,880 | 1,663 | 2,190 | |||||||||
| NET (LOSS) INCOME | $ | (1,618 | ) | $ | 509 | $ | 178 | $ | 546 | ||||
| Basic (loss) income per share | $ | (0.09 | ) | $ | 0.03 | $ | 0.01 | $ | 0.03 | ||||
| Diluted (loss) income per share | $ | (0.09 | ) | $ | 0.03 | $ | 0.01 | $ | 0.03 | ||||
| Weighted average shares outstanding-basic | 17,950 | 17,802 | 17,933 | 17,807 | |||||||||
| Weighted average shares outstanding-diluted | 17,950 | 18,123 | 18,296 | 18,121 | |||||||||
NEW YORK MORTGAGE TRUST, INC. AND SUBSIDIARIES
CONSOLIDATED BALANCE SHEETS
(Dollar amounts in thousands)
June 30, 2006 (unaudited) | December 31, 2005 | ||||||
ASSETS | |||||||
| Cash and cash equivalents | $ | 6,911 | $ | 9,056 | |||
| Restricted cash | 1,255 | 5,468 | |||||
| Investment securities - available for sale | 652,674 | 716,482 | |||||
| Due from loan purchasers | 76,139 | 121,813 | |||||
| Escrow deposits - pending loan closings | 1,385 | 1,434 | |||||
| Accounts and accrued interest receivable | 10,514 | 14,866 | |||||
| Mortgage loans held for sale | 84,327 | 108,271 | |||||
| Mortgage loans held in securitization trusts | 690,502 | 776,610 | |||||
| Mortgage loans held for investment | — | 4,060 | |||||
| Prepaid and other assets | 24,636 | 16,505 | |||||
| Derivative assets | 10,899 | 9,846 | |||||
| Property and equipment, net | 6,985 | 6,882 | |||||
| TOTAL ASSETS | $ | 1,566,227 | $ | 1,791,293 | |||
LIABILITIES AND STOCKHOLDERS’ EQUITY | |||||||
| LIABILITIES: | |||||||
| Financing arrangements, portfolio investments | $ | 1,039,799 | $ | 1,166,499 | |||
| Financing arrangements, loans held for sale/for investment | 157,006 | 225,186 | |||||
| Collateralized debt obligations | 213,486 | 228,226 | |||||
| Due to loan purchasers | 869 | 1,652 | |||||
| Accounts payable and accrued expenses | 19,651 | 22,794 | |||||
| Subordinated debentures | 45,000 | 45,000 | |||||
| Derivative liabilities | 229 | 394 | |||||
| Other liabilities | 383 | 584 | |||||
| Total liabilities | 1,476,423 | 1,690,335 | |||||
| COMMITMENTS AND CONTINGENCIES | |||||||
| STOCKHOLDERS’ EQUITY: | |||||||
| Common stock, $0.01 par value, 400,000,000 shares authorized, 18,327,371 shares issued and 18,024,840 outstanding at June 30, 2006 and 18,258,221 shares issued and 17,984,843 outstanding at December 31, 2005 | 183 | 183 | |||||
| Additional paid-in capital | 102,590 | 107,573 | |||||
| Accumulated other comprehensive (loss) income | (2,643 | ) | 1,910 | ||||
| Accumulated deficit | (10,326 | ) | (8,708 | ) | |||
| Total stockholders’ equity | 89,804 | 100,958 | |||||
| TOTAL LIABILITIES AND STOCKHOLDERS’ EQUITY | $ | 1,566,227 | $ | 1,791,293 | |||
NEW YORK MORTGAGE TRUST, INC. AND SUBSIDIARIES
SELECTED SEGMENT REPORTING
(Dollar amounts in thousands)
For the Six Months Ended June 30, 2006 | ||||||||||
Mortgage Portfolio Management Segment | Mortgage Lending Segment | Total | ||||||||
| Total revenue | $ | 5,645 | $ | 16,390 | $ | 22,035 | ||||
| Total expense | 1,194 | 22,459 | 23,653 | |||||||
| Net income (loss) | $ | 4,451 | $ | (6,069 | ) | $ | (1,618 | ) | ||
| Total assets | $ | 1,366,551 | $ | 199,676 | $ | 1,566,227 | ||||
For the Six Months Ended June 30, 2005 | ||||||||||
Mortgage Portfolio Management Segment | Mortgage Lending Segment | Total | ||||||||
| Total revenue | $ | 9,724 | $ | 19,049 | $ | 28,773 | ||||
| Total expense | 1,928 | 26,336 | 28,264 | |||||||
| Net income (loss) | $ | 7,796 | $ | (7,287 | ) | $ | 509 | |||
For the Three Months Ended June 30, 2006 | ||||||||||
Mortgage Portfolio Management Segment | Mortgage Lending Segment | Total | ||||||||
| Total revenue | $ | 3,109 | $ | 9,355 | $ | 12,464 | ||||
| Total expense | 699 | 11,587 | 12,286 | |||||||
| Net income (loss) | $ | 2,410 | $ | (2,232 | ) | $ | 178 | |||
For the Three Months Ended June 30, 2005 | ||||||||||
Mortgage Portfolio Management Segment | Mortgage Lending Segment | Total | ||||||||
| Total revenue | $ | 4,587 | $ | 11,947 | $ | 16,534 | ||||
| Total expense | 1,094 | 14,894 | 15,988 | |||||||
| Net income (loss) | $ | 3,493 | $ | (2,947 | ) | $ | 546 | |||