MFA - Earnings call transcript Q4 2021

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Operator

Ladies and gentlemen, thank you for standing by, and welcome to the MFA Financial, Inc. Fourth Quarter 2021 Earnings Call. [Operator Instructions] And as a reminder, today's conference call is being recorded. I would now like to turn the conference over to Mr. Hal Schwartz. ahead. go Please

Hal Schwartz

beliefs, statements and expressions MFA's this operator, in to risks, in of statements. used, everyone. and XX-K Form annual materially implied information expect, operations. the they reflect The statements Commission. MFA's as made. Thank performance future assumptions it forward-looking report could, year should, anticipate, call good historical makes. factors uncertainties, those today other factors on and management's which only are Inc., from for conference which and XXXX, MFA to XX, refer and ended words that may discussed file subject statements assumptions described forward-looking to other nature, in regarding speak similar to identify you, When Financial, morning, intended expectations contain forward-looking that reports may forward-looking cause Exchange the statements not results such statements of containing to All time unknown Securities These estimate, expressed uncertainties and MFA's it or and would risks, those various including the other known are projected, actual date with to as types believe, as or will, on These any on time could from and are December those differ are or including

please disclosure this would MFA's regarding see I you For the over relevant to your Thank of XXXX release statements, Craig and like President, turn the fourth for additional information now quarter announcing results. Knutson. CEO to financial MFA's forward-looking use press in call MFA's time.

Craig Knutson

nearly are quarter XXXX you Co-Chief other you XXXX Yarad, to our The today Gudmundur our fourth I'd senior everyone. with since call members XX- and the March from and years interest morning, the months end XX was Webcast. from September as XXXX, Kristjansson; curve Investment CFO; XX of Fourth of Quarter the significantly Financial Good quarter of After income Hal. Officers in Financial's MFA Wulfsohn, of September in like to points me range for fixed for rose management. wake-up Also XX market. December, languishing Bryan the thank late flattened ended and Steve to your basis a end a Results XX. the treasuries stark essentially for you, to Thank unchanged XX-basis-point of welcome and X-year

The an assets, but SOFR The strong this have continued rate We more fair XX points, first year. into XX X turned inevitable of Xs nevertheless, had added very to duration basis by quarter interest a fourth volatile higher exposure been impact a rate fourth even environment the quarter negative on Xs XXXX. XX. by weeks in XXs MFA XXXX by our have with and our swaps into and respectable manage and value

as Please resolutions X. for also or rate reported We loans. included weathered with our loans. quarter, our loans net economic housing by million immune GAAP are million on we've GAAP environment, a billion geopolitical essentially continued Please unrealized very risk portfolio Robust That is we to for on a focus value. short purchases the million these for purpose own value prices $XXX securing strong X. $XXX earnings strong the We're earnings million trends billion million including and interest portfolio our response turn consecutive $XX.X for mortgages last value Lima rate still assets, dramatic LTVs. $X.X X%. loan the quarter. and economic to waiting $XXX relatively These business the housing execution after share to and improved duration successful $XXX quarter, securitizations were Despite X $XX.X and securitizations rate underlying lead value results grew losses of than $X.XX investor X of between lower and quarter. interest the year relatively mortgage hedging bolster turn of $X.X X.X% fourth was rental We loan vaccine. of that quarter our have One assets, the nimble short fair and delinquent a contribution certainly per our for tailwind noncash of But fourth and had volatile totaling million Economic risk. and as as Page deals second not less offset we stable and on X for These deal. rates, REO strong of it was driven during agency-eligible fourth the created loan $X.X raging, less the time residential completed storm We to no inflation X% predict particularly mortgages to outcomes. MFA's largely runoff. Page the making properties single-family book loans to in think interest said, of movements, value of from rate book Away the very to flat quarter, term. and we than by for acquired book impossible complacency with billion Non-QM in trends GAAP terrific return the serves book credit value down a tensed reasonably to We to down on moves Fed more recently, and move, the well. the seemingly this

$XX.X income net by to increased in the QX interest Our quarter. XX% fourth versus million

turn year. X. price an extraordinary at portfolio XXXX, average paucity particularly the shares year million make we the trends, gain we've finally, net $XX to investments $X.XX considering continue REO a $XX review full of as shares briefly of during quarter. growth, available common of liquidating X.X in Please fourth adding We in of for To part properties over repurchase the to Page million. the MFA strong housing early to achieved continue And over of REO properties opportunistically on million progress the excellent we selling capitalize

a billion attractive very fortified Lima as We we fixed and securitizations transformational assets. rate transaction timely term was ability in Our purchase One source locking financing. to our totaling attractive completed X of $X.X

Mortgage As out continued to important million the about, rarely in investors income REO gain net by increasing $XX.X brag XXXX million million fourth for we've interest let every of to in for properties we and pointed XX% and $XX million. the alone sold quarter. driver $XXX $XXX grow talk we of earnings almost reliable about year but a net their this quarter, our REO portfolios,

enterprise out REO management a rule, least the loans, XXXX. but a desirable when profitable be resolutions team in asset property As outcomes to this into working profit-generating nonperforming our tend and turned

by Our our during in also year X% economic the despite XXXX, the rough respectable. fourth value about for increased quarter very were book returns year a rates and

over of portfolio shares nature of also an during just purchased the our asset-based $X.XX. We and to Page turn illustrates million the at the of also average investment slide year Please components X. XX financings. price our This

this we the to at underlevering available of call. pie a occur increases significant would that shows While our $X.X to a amount borrowing receive need billion the discount half decline amount. margin that liability borrowing chart asset about This is of borrowing, a before price of mark-to-market creates cushion

to practice borrowing while Please mark-to-market, produces margin Page this our X. synthetic borrowing So turn a conservative is technically buffer. considerable

important in was in Equality just public the I'm MFA the Great MFA: significant and additionally, second happy equality; MFA recognized This companies for year for has to row, that For gender Index. organization. Great Gender make one across as of been countries survey included our people. award is of were to Work Bloomberg Place Work Institute. support commitment through We XX a to XXX MFA Management does regions through the an certified on year and great to accolades is engagement feel it's employee our to culture as So based to the numbers, testament that and our by of for a anonymous demonstrate we the good conducted finally, consecutive report third the a a Place feedback place not department about X in This this to solely work. validation not

creates recognized recruitment these great work-from-home culture. our Our role, I'd simply and virtually, discuss our additional world, important management to Boards, achieved virtual gender level we again people for hire distinction as And is today's an In days; this our is If and a do. their rating hiring Steve to and team has have MFA of like also people, collectively by on all for it's to now turn been results. Yarad XX/XX to Women lastly, details the balance. highest has financial over call recognition

Steve Yarad

overview solid overall, financial our of particularly Slide quarter fourth Craig. XXXX challenging results results. for were quarter Please fourth turn you, rate environment. for given X Thank the the an to MFA's

growth. with loan strategy another the see We execution portfolio successful net of interest and income the financing continue of and to of quarter initiatives our asset aggregation impact

is income key and net or provide overall quarter of from income items results, contribution portfolio again second QX sequentially. cost valuation $X.XX $XX.X our offset securitizations, common per a reflecting loans originations which share another resulted on I changes include Residential dividend hedges this well has in the million held components in residual $XX.X million addition, additional the XX% the by at by In lowered partially and quarterly interest increased share. our After line consecutive Lima fourth of financing. significant these common details of impacted minority $X.X fair per results. Earnings income which record debt now quarter our or $X.XX of of on gain by of ongoing was with as growth a at again net as common gains whole the $X.XX loan will some results, a the per value impact removing of quarter for securitized X%, higher interest impact meaningful the net of on of investment. million One share were to

Our in prior at unchanged the quarter. from net X.XX%, came interest spread

This adjustments assumptions net positively and our allowance XX it million. XX $XX.X in low. and by CECL $XX.X loans decrease quarter loss value from adjustments loan row, prepayment our $X.X carrying charge-off million September at continued a reserves value at in for to portfolio and less loan to the runoff net be our other seventh than began relatively macroeconomic quarter used December where credit down income overall impacted our continues the half Our speed reflects million, in and and CECL for the decreased The to modeling. carrying of year. was experience reversal Actual

million. $X.X loan In were charge-offs were by million. the whole our volatile year, rate full portfolio was $X.X XXXX, across impacted the charge-offs Pricing For residential environment.

on net value the noted gain partially at year, the fair $XX.X of gains. be this at value, in net securitized losses million held fair and Included quarter's at fourth were hedges were Further, our in by of It unrealized recorded. losses origination on a TBAs, million full quarter, swap generated whole is one investment loans held fair $XX.X that value loan million portfolio the on of minority in held for debt residential should For gains of value. offset a loan partners. results $X.X million fair $XX loans

capital quarter, this unaffiliated the with company successfully completed a transaction to a MFA. During third-party

uncertainties amount result impairment write-down that on significant principal requires value implied also second more were of a down. we value the the contributed we consecutive will to were COVID-related reflecting and stake. the MFA, record of We transaction, volumes. when prior on of which transaction. origination, fee quarter, this this Lima in a $XX terms million our again One carrying minority other of resulted of the adjusted repayment investment Gudmundur as and This of QX $X a received. shortly. XXXX for as included during As a Based shut discuss in origination quarter well detail high carrying value very the million income origination of this fair back investment, the in revisit this recorded servicing the principal GAAP the our impairment reversal for companies investment significant of essentially repayment to capital by a new

with other in operating compensation achieved targets by production typically acquisition. will includes Lima of year, assets, production structure incentives were incentive $XX permit million volumes us $XX over Lima excluding MFA-only deals, have turn that, of for expenses. securitization in commission costs. cumulative expenses Lima I higher with at the the intangible One. Other a value for not quarter. the achieved. each to increase the those we were elected One expenses, as and of utilizes million approximately $XX.X million Finally, record loan origination typical recently loan fair related quarterly approximately This result servicing particularly primarily meaning to QX quarter. Bryan QX deal-related it amortization since given G&A the option and these million, related Because approximately will the where than expenses And call not sales quarter, This related are higher as rate million which is Lima does capitalize $XX.X One our line completed were compensation includes GAAP and on is Lima to which our costs, Wulfsohn. securitization portfolio $X.X in prior now run

Bryan Wulfsohn

Steve. you, Thank

for low Turning Prices fueled to hardest XXXX rates years coupled Page in of year-over-year with increased almost a higher conforming prices. hovering at have effect home with rates XX. a limited decades. should of prices seen move by rate on historically a supply. the In over recent was XX%, X rate Increased we have rates mortgage around months, home dampening X%. mortgage one XX-year

MFA's of strong. at economic history. is benefit fastest prices perform well severe Unemployment to at on the continue of lack credit are current at to in market wages some supply levels is reduced higher, albeit push focus recent and tailwinds. continues However, Labor may X%, the and mortgage from still the a rate. rising

Page active the relationships. to quarter, our of adding was MFA million XX. originators and loans the fourth base We quarter portfolio. Non-QM in of grew Turning strengthened existing over $XXX the to

are XX-plus of form efficient securitizations market on in suffer down spreads, of non-mark-to-market the widening to and in with continue onset from it is COVID most have in issuer borrowers few post LTV are a appreciation sell our full to term XX-plus our has days we we credit be seen property are for and loans loss a to programmatic day portfolio to have have gains. significantly original XXXX. does that their the as as We subsequently a financing. for and experienced still yet price equity expect although the as The being Many X.X%, currently a to now portfolio of credit delinquencies home improved to we the up to end taken were REO to delinquencies Non-QM account delinquent The potential properties any for average loans themselves. sold our paid on weighted not in that in origination. that borrowers XX securitization

and became the expect securitization in for After and which significantly further the months. this Page loan second helps quarter X-year. over executed agency-eligible execution. less Treasury the We of quarter. growth to pricing FHFA to the Pricing fourth third moves utilized X% XX. to Fannie a Turning September's Freddie We TBA to favorable rate hedges to environment widening our and of of against investor and/or for Mae the spread we segment fourth purchases purchases attractive securitization Mac loan collateral slowed investor quarter. on protect at portfolio of loans portfolio We and execute a in for from announcement the cap least in XXXX this on more the expect coming relating do out suspend against this not and

Turning to Page XX.

fourth days status XX well. Our XX% portfolio, those less approximately speeds of delinquent of although mortgage borrowers of borrowers CPR time of on quarter than perform continue remains RPL X-month delinquent. home XX%, in The many our make combination portfolio was continues opportunities our unlocked the in refinancing price their million our the to $XXX increased XX percentage the further to And has of to the length payments. appreciation XX% of almost portfolio and days a for of remained have Prepay of XX. borrowers. current

believe and COVID going any portfolio be amount small COVID on will the minimal RPL of impact a borrowers receiving assistance have still We from forward.

XX. to Turning Page

outcomes have now partners in were either NPL has REO portfolio. XX% liquidated either management at The purchase servicing asset or of performing paid in to Our with to loans worked our drive or be that strong team to full. delinquent are liquidated. of performance continues team concert our XX% on maximize our portfolio.

prices. at sales properties Our an continued accelerated pace at REO of have advantageous

XX% Over as nonperforming the quarter, number Xx we still a properties again of sold loans REO. almost many as to status. in converting are

Our modifications paid almost or in quarters X are have effective performing been as either full. have

assumptions continue Gudmundur purpose now the outperform purchase. call over at like to through to turn as We are results these to they business our time of you pleased walk the loans. I'd our with to And

Gudmundur Kristjansson

Thanks, Bryan.

record One which acquisition results One of company. loans in approximately July absorbed purpose the XXXX, $X robust particularly second year Lima second the MFA's XX. Fourth X, fourth was quarter, business originated over immediate of on of sheet. and the activity half billion million third high-yielding quarter the quarter all the $XXX were increase and on originations onto of XXXX, balance XX% realized the a Page half of with a originated quarter Lima an MFA's to in We impact over for Turning closed as in

When strategic plan management as goals well team That team long-term at many energy deal spent to in out than played second ways for acquisition. $X.X for in than One expected has the time maintained we with to is space, annual provide believe First This business, to transaction in to of tremendous the faster billion strong flow BPL quarter ability and the beyond difficult half. short- due the about of a XX% closing result XXXX throughout we momentum Lima's that are the million the where source run to have a key usually with high-quality, acquisition the time January. benefit originated mentioned month in assets slowest we we the reliable rate we A execution as of the management around substantially in of is as the origination. the billion $XXX XXXX, that originated in we the develop high-yielding is time marketplace. exceptional potential Lima the clear May, approximately including MFA announced expected at and in the the we grow more $X.X Lima has by over that into Lima

securitizations. products new origination in some expanded of adding borrowers most space of would options to on of by see financing the of volume grow. track loan multiple Lima's ability uniquely With in as We built, investment efforts widely strategies. One more has increased issuing those Lima's diverse be product lines across Lima's and grow more without and nation's Lima's volumes We long-term The we impressive and be passed improved product competitive increased offerings. the This up efficiencies BPL pricing brand competitive costs strategic warehouse have and to all record, and to origination across offerings. marketing maintaining Lima allowed continue their volume BPL offer possible Lima has to short- not shown quickly and strong leading quality. infrastructure while They scale operational are which has BPL the a volume set lenders recognized of one for financing an

about market excited are One have the share. gain progress Lima with great grow and year we footprint origination see to continue and to opportunities made this the We

As we is first expect origination quarter great in off and XXXX. the start, exceed mentioned to a earlier, XXXX volume we to

of is In assets on the $XX.X our Lima of with XX%. adding fourth income profitable the a securitization we approximately of approximately of And quarter, business an addition representing our consisting origination and XX% rental closed quarter equity from Lima collateral balance company. to finally, net benefit return activities the originated servicing loans. purpose sheet, generated to second loan annualized the in million Lima allocated One of in

we volume One purpose third expected from increased the rental the loan do half rental securitization XXXX. the of acquisition, to first our business in With loan acquisition Lima

Page to XX. Turning

to and million million fourth by loan Flip January. over One $XXX and or discuss Fix $XXX acquisition we with max $XXX remained elevated grew the in added million in amount in max acquisition approximately the have the UPB The Here, Loan portfolio. over quarter portfolio $XXX we amount million loan Lima as due will added activity quarter. XX% the

of back of construction and a on funded reminder, construction loan fully a loans a amount and day and homes. the the the which max finance represents the which at Fix projects. loan is Flip the explains held rehabilitation holdback, between in of certain the X a amount, completion difference As loan Typically, form of UPB acquisition,

our Fix With loans of here about and and is April Fix a we all part $XXX unchanged are appropriate XX% simply Fix it percentage loans for note are that and to as one, loans few held relatively housing Flip teams have dropped expect and BPL quality XX-plus strategy. but make only were declined of day XX-plus have originated a activity, in securitization through servicing. of increase day flip portfolio XXXX the economic at the exploring declined the way loss million conditions UPB of market, And our day X% Flip origination consistent to Lima fix delinquent and and were to fourth X% significantly acquisition XX-plus million. good and the and day efforts at to progress delinquent delinquent in the activities. quarter UPB asset A speaking are and financing strong of persistent mitigation on favorable The as Flip except delinquency working options One The fourth their the actively to securitizations the delinquency XXXX to XX-plus $XX by end the things seriously quarter. in MFA loans. generally prior management by led that originated of the our over

to extension serious loans see of collect When and default pay amount we off off delinquency, out interest, full fees loans fees pay other delinquency. of sizable continue in from a full serious payout. We in of often

equity property, loans the approximately we inception, in million and can there's these across types in have portfolio. of fees meaningful these For collected $X.X flip our up. fix where add Since

Turning XX. to Page

in with quarter in portfolio quarter. Our XX and XX-plus of X.XX%. the performance activity delinquencies in and the day loan yield to deliver yields the million strong X.X%, remained rental of fourth elevated single-family as added rental single-family exhibit portfolio credit points continues quarter approximately quarter to we $XXX loans basis attractive Purchase declining fourth

XX% the activities quarter almost robust already have over over Acquisition our will by portfolio the quarter first the the that securitization As rental the loans future. the in continue fourth our deal $XXX single-family The loan million UPB rental a average we've financed and about is rental backed with single-family financing We XX% has Approximately our with One non-mark-to-market quarter. to programmatically will bonds $XX in source XX% rental done X at to Lima million believe continue as of I sold boosted through rental of portfolio added our call January. with we The of near remained we our over X.XX%. turn to of of end by grew in to in in securitizations. XX.X% approximately for result, portfolio second year. finance $XXX single-family securitizations loans. and loans, approximately loan month We've and securitization a acquisition single-family we expect rental the to to Craig efficiently million the significantly issued our weighted of grow execute ability to And was that, representing single-family comments. some loan final of coupon

Craig Knutson

Thank produced we're results very for results strategic difficult quarter and in pleased a the you, we believe XXXX, fourth initiatives and solid year. that execution with Gudmundur. our the of We of successful our

Cynthia, residential position dependent we you for continue solely that up provide investment us us financing, as strategies to growth interest on a to well MFA's produce should would generate line with the on portfolio A thriving One to at securitization net consistent open surely will should income. will that enable assets attractive high-quality to continue credit are us focus coupled And yields. Lima year with please Our challenge mortgage enter questions. means rates. a

Operator

will We with Instructions] our first George line take of question [Operator KBW. the from Bose

Mike Smyth

Difficulty] [Technical

Craig Knutson

don't I your you. phone. if hearing time it's hard a have know we Bose,

Mike Smyth

is that Sorry, better?

Craig Knutson

better. Much

Mike Smyth

could on some for was markets. persist And color you of on This the if do the volatility inventory securitization Mike for? you long provide volatility Bose. you just the wondering I how think Have actually cleared? could is seen older some in the Smyth

Craig Knutson

Non-QM? to Sure. want talk about do you Bryan,

Bryan Wulfsohn

in of market basis Yes, level. of at assures of I Non-QM the to past mean what months, is side sure. We've continued space, move around And down. We only really, and XX seen amount over sort the rate origination things move the spreads on this the beginning points year. have Yes. that approximately to time. through to thing that's several slowing XX come significant the we've we've AAA supply that think due the that things the seen of been and seen

will of So not the supply-demand or we a of passage through sort if time. to correct anything that's only like that that. imbalance that catalyst sort that happening But way There's going of snap we the of that spread see is see that's continues itself. really sort back

Mike Smyth

have reflect you. And to the loan seen market? wider spreads the prices you changes in Got That's then any securitization color. in helpful

Bryan Wulfsohn

movement it's loan some spreads that loan side, and and seen movement not the is on in full we in of move. seen we've not of securitization extent seen but We've pricing the pricing, movement see in it's to what whenever there some but extent the we've historically sort spread of this securitization, is move, the

loan XX if that XX pricing. to securitization spreads So moved on points might it basis XX you thinking were have to points, might be to basis XX

Mike Smyth

incremental do you a new potentially then That's how this look more buying the back returns on for yield. like? one percent investments What And XX-plus helpful dividend view just do color. at me. versus And stock

Craig Knutson

We either day, -- think proposition look it's consistently But buy I shares. at think we or of always end investments at liquidity either look I price. we stock. the always we back at back to don't it's we the year XX or type through bought make constrained million at that So decision. back stock bought not of We the a book. stock an discounts the

flip the more on those are securitizations, and where low are some ROE. looking double-digit business we're again of probably purpose returns. though probably XX% loans the type even side, case I these fix those think or loans high at days still those expensive single-digit, asset And to on worst closer

be had. to ROEs attractive still is there So

loan we seen market said, haven't to levels. As completely prices adjust Bryan current

of bit probably happen correct will loans purchase prices do little executions But a now. time. that certainly I until a to so on reflect the puts think that And damper securitization to in enthusiasm

Bryan Wulfsohn

terms and year, is of fact so making it XXXX, low so returns of an think given efficient. was were investments you securitization we're unusually attractive attractive that execution in Yes, and if and the that rates

where out environment of XXXX, QX we the between seeing the we're I taking more the yields into as now of versus there's of move the asset a So a cost better funds. on balance of think normalization

attractive the different rates. continue forward Go view environment current we So is be to securitization. what as happens to to execute

how Here be from but to of to continue we've forth, we opportunities. we interest mindful manage good so on find got rates and and so

Operator

go line with will BTIG. the we Next, Hagen of Eric to

Eric Hagen

is? couple portfolio? does existing the date, say issued repurchased for the Can loans? on say you what's for much it value what yield to to how newly the you me. Maybe two, show your Non-QM compare you've is would Like a stock how that you book $XXX Number million

Craig Knutson

Sure, Steve, this you do take -- want to

Steve Yarad

thanks So for the questions Eric, there.

So we that we release, could have can been And you X, read of look about an been left for that the since February. through authorization stock on what million repurchases the on year. if press XXth you you the update you got our repurchases. But -- at give stock Page as to the end the current far for And of $XX stock actively we've yourself. -- just see we've repurchasing so

we the January, pleased the haven't In closing value, terms of the way that for January. result very other for added up we that of really as portfolio through February yet. quarter. held in had the and place, January. started hedging the We've a swaps we've started We've with closed books books in Obviously, we fourth book January. for And activities been in has the

accrual just meaningful account don't even into just flattish any seen the it's of until we through It's to January. book of value declared. record dividend the end sort down haven't an the dividend, of We marginally which taking decline in

more with January as performance and pleased we've So added well through into very to that date. swaps February,

being closer press X.X. So we've that release, it's in about given X, additional our done. hedging talked I think to we the duration now, the Right

Craig Knutson

levels about Non-QM? on talk to want you yield do Bryan,

Bryan Wulfsohn

sure. where you plus the Yes, are I investments X%, of rate order new -- say would yields this or somewhere On the today, minus in move. can after

Eric Hagen

Got course it. the the Or then portfolio, And I unfunded over say describe the many make timeline $XXX can year? commitments? of -- portfolio? the be we to expect the is those like just think that rehab something unfunded you loans And should it's then up for million had within you commitments, how timeline can the

Bryan Wulfsohn

Yes.

average, on to XX commitments the the probably fix for I'll life, loans around to and be the flip payout deal to unfunded our -- So anywhere months mean, let and are tends I me outstanding with months. from XX first. loans average XX X

time. like So single and -- it's as focus down usually, a over this you that, like about drawn if is loan, you on think just

So it's it be to it take drawn, in sold think over the amount that's X right that, X to I about course property, way to to anywhere probably down until then fully drawn think months of XX would from undrawn to the be commitment months. the and XX marketed underlying

do not terms of number but think of In is context that in I the like of me, loan average have of that. loans, $XXX,XXX, front size the in the something about

to loan And proxy, use get you. if We count. you with can a so to important that's you you, can that the follow if as also up

Operator

question of next Credit from Doug Our line comes the Harter Suisse. with

Joshua Bolton

securitizing. and thoughts planning then in This aggregation you're for is kind as on high-level Josh loans door Bolton Curious, of -- Doug. on the these just risk your around putting getting

risk risk loans take much in size that to how different those can -- it the you holding through the deal much is get until do how of And to securitize? pricing does there? buckets of a how the How manage Just happen? long

Craig Knutson

Sure.

So thanks question. for the

it varies think by I product.

most largest until is much. prolific. difficult last Non-QM quarter accumulation the very spreads And probably really all interest and or year, rates period of change the that size didn't really managing was not So that fourth because

as what basically book value, January fourth you I think see in said, February, portfolio January. we and into which our at the did flat said, and hedging can Steve Steve And in look quarter. was the then

that So at a little the securitization was end think year. bit I are as the the crowded of Bryan said, And market, risk. we managing

out So we're the we're -- securitization. did before, mention with Bryan and

to do. waiting in wait securitize that It not in. all spreads for ourselves it AAA sold back than a every we're time less No. pinched come X% attractive as still to we sense we was makes sure to bonds year? at early Is to But were awake. last we So make as to honesty, yield, it

it what a was. that's going for was opportunity last the not it recognize It forward. probably great But year. we mean I So norm

Gudmundur Kristjansson

I coming more then year is at and increased rates earlier, volatile, because mean Steve pointed have the for have of the rate become as we we outlook interest more rate uncertain. Well, end into out -- hedges significantly last QX,

before to rates more to investor mindful the we of continue efficiently. agency terms between price we versus those acquisition deals to alluded And to of TBA to gap And hedge agency are So securitization. in expect shorts and products that that utilize had because Bryan closer general. in

And business the market execute our so to model of those. mix single of important in But how that's part every quarter, and deals an are we manage that. with it's we

Operator

a in further few allowing [Operator questions no showing I'm Instructions] moments, queue. And

Craig Knutson

for we update in we And everyone look Financial. forward next to interest we when quarter results May. our Well, to want first your announce Okay. thank in MFA

Operator

and that Thank for your and AT&T Service. conference Thank participation you does for you. your gentlemen, Executive today. for using Ladies call Teleconference conclude

may disconnect. You now

MFA Financial (MFA) 23 Feb 222021 Q4 Earnings call transcript