GPMT - Earnings call transcript Q4 2018 | Granite Point Mortgage Trust Inc.

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Operator

Good morning. My name is Phil, and I will be your conference facilitator. At this time, I would like to welcome everyone to Granite Point Mortgage Trust's Fourth Quarter 2018 Financial Results Conference Call. All participants will be in a listen-only mode. After the speaker’s remarks, there will be a question-and-answer period. to for over Granite like with Chris now Relations Investor Point. would the to conference Petta I Please go ahead.

Chris Petta

a fourth results. of Thank and quarter our you, press summary this items CEO; of our call the and a After brief provide with and Point's Marcin our will fourth recap COO. financials. you morning Steve release for XXXX and good conditions; activities our our introductory Marcin CFO; will associated my with tables morning, originations Plust, SEC. today's to everyone. are Alpart Steve The Jack Jack financial from Urbaszek, discuss our our key President market the were our me CIO; on business call With yesterday pipeline; Thank Taylor, joining and will quarter comments, call discuss financial and highlight and Granite Alpart, Steve filed

location. copy, on call. to this being sec.gov. GAAP on a you would review not Relations measures. with maybe non-GAAP them accessed you information and webcast mention section the have find you in Investor earnings our of like I now In SEC's If the which posted today's release and same in in website website, We to to also have a the do that this conjunction is urge financial provided reconciliation are may of we slides, call or website our our website our at on

and slides include over by during to you made remind turn supporting management the like may call call conference that Before Jack, to statements. would I I forward-looking this remarks the

not and of urge other such rely materially unduly our expect, from We and and as words the our in them or associated imply expectations. which any inaccurate. or on the on I'll to be over actual risks caution turn call website views with be risks you obtained typically may SEC's carefully filings any prove uncertainties, reflect described to the forward-looking are statements later believe may do SEC, They results not Jack. update with to to statements. the forward-looking events regarding and to differ We consider undertake We anticipate, obligation estimate future words. the investors such if sec.gov. events Forward-looking statements use now correct at

Jack Taylor

you, to welcome all year and Chris, XXXX We excellent our like you and to performance. Point. an year Thank thank quarter for good morning, and our discuss was would everyone. call fourth joining full Granite for you

while greater provide to in raised and capital CLO closings. we rate the sides of the facility across asset our expertise and our strong talent financing balance on loan results our bench strategy strong XX% term-matched, to grew $X.X balance. flexibility our We successfully accessing secure And principal non-recourse sheet, our $X.X securitization short-term extensive executed new shareholders. growth strong over up With board. XX% growth Markets. and borrowings our we a experienced on established new funds. of by deep to delivered To investment efficiently business and both XXXX. senior to support loans, originated and our We billion outstanding executed We of the Our of Capital our We of portfolio reducing directly managing financing. by non-mark-to-market our overall structure the floating liquidity inaugural diversified cost additional priced growth, of billion we grew from

we common the per shareholder dividend returns. yield growth our the which In attractive year, shareholders. of share, our activity resulted an declared fourth earnings course All dividends generated core to of in share core the $X.XX earnings and we $X.XX provides driving quarter, current in of over and per of believe substantial a

by including our and asset originations, advanced essential to developed Notably, financing-related part business functions, financial function further a activities, rating including investment management is agencies, among and at Senior XX with years reporting overall across our Officer experience, and This over portfolio some bank. capital addition XX all at have estate markets, we business. our Senior an as of the years we various Executive led the real In others. roles platform of a Credit senior commercial major have credit

We are strong deliver one platforms it of real estate and that continue have built the to finance commercial leading results. confident will

Our with record fourth total closed by million originations of the quarter. performance in loans XX new was commitments. approximately robust highlighted We XXXX $XXX senior

originations achievement, significant over largely capital and issued portfolio October loans, forward resulted of closings $XXX raised over prepayments, fourth have we $XXX million growth. loan of pipeline million our strong of convertible the in combined when in Our our quarter we notes. with With we limited record committed

see continue return to flow of our healthy investment attractive opportunities a requirements. credit We in meeting

types in sound view overall improvement volatility fourth market credit markets to of rational. an beginning of available the suggesting to lending continue and haven improve by maintain the believe This we sources as company of of are lending base us may and approximately real estate our since we As funding and have have in offerings fresh by of such IPO standards as valuations to stock the that our activities the capital a generally capital the supported Since commercial fundamentals million. portfolio support be remain result, overall and asset. again accessed quarter safe macroeconomic We are is lending gain we spreads widening a to counterparties. the a to XX% a and markets assets loan our our to optimism. proceeds again, last of once total markets fundings. year a ample access originate business with we scale. estate especially equity enhance that grew market that our securitizations in the more strong of market assets This us of CLO offering for quality range we in and selling broader and trends. seen markets, We some successful the in common continue week, the the more continue of and though strong to both to quarter. remains Property $XXX and impacted loans first diversified cautious real instances. capital the seen are through grow mix, When X.XX growth with attractive. is even regards million tone Overall, further have moderation CLO options for and the of a and Competition suitable fund additional capital executed the to of wide shares set provided volatility sentiment the compression managing securitizations as likely fourth by active we the loan The result true

As our continue the the able believe, we markets in attractive team ample have our built opportunities the our for reliable lending. have has recently, to to counterparty decades due differentiated been we as strategy through part, developed of investment portfolio, source over and relationships origination reputation stabilizing been our to

confident business Our and time. risk-adjusted by continues to grow returns deliver strategy high-quality that mature to will our platform attractive are and our our we supported shareholders over

in year Point. are to We XXXX to start off another a strong and we for Granite forward look great

call our investment over Now, discuss to in Alpart to I detail. more activity turn Steve will the

Steve Alpart

portfolio. I'll you minutes thank morning. and our you spend our We this a fourth your Thank and reviewing for originations, all forward appreciate few time our Jack, quarter joining. pipeline

fourth the fourth build in pace fourth origination accelerated large we a largely our we've portfolio of generated were able representing the highly In of in quarter, investment loans a the October capital quarter since we and available our opportunities the by to third committed inception with closed the capable attractive By offering. new to new taking loan XX deployment the Following growth had quarter in we funds quarter, highest the us, of for advantage of solid total $XXX commitments many platform. pipeline the raised the in quarter, volume approximately our direct of investment business. convertible we bond closings, million

opportunities They quarter fundings weighted and secured existing, target and were fourth of our are total XX% across fourth income-producing properties lending borrowers. and approximately $XX yield the from markets actively our investment loans. standards existing the LTV attractive initial new types. and underwriting meet in in by well loans, very of a reflective of X.XX%, to average increasing sector LIBOR add were Our type closed are of our produce industrial we returns, property upsizing longevity million loans providing the have ability commitments with high-quality, plus comprised of a about about loans $XXX markets XX% loan across highlights and X% Overall, pleased average diversified The million of our with our our weighted high-quality pre-existing property two in million the from allocation for the We which to million the platform $X relationships and $XXX us fundings target quarter strength mix from general additional diversification. market and portfolio credit, in trends. of participate high-quality the and our to

we December, As quarters, anticipated to fourth the last portfolio a be $XX we The and low-level partially of about amortization contributed we prepayments only over disclosed to growth combined and our overall realized in which prepayments strong in less the can active attributed quarter. million of million portfolio very had low-level than two management. $XX

on current a portfolio later on addition focused our properties reviewing the opportunities quarter we by exact it higher attractive plans. to our stages In in we credit are to continuously business last predict actively timing. investments the of from though realized anticipate perspective, the is than very loans in amend assets monitoring also be levels preserving are in the that to amount and low quarters, to two difficult prepayments We the over their

and was continue will including principal XX%. we end approximately annual at it funding of seasons, believe portfolio billion balance pay outstanding our commitments. an future billion of quarter $X.X our portfolio As rate off to our that At $X.X likely

healthy asset over positions origination continue LIBOR Senior property flow stabilized markets investment X.XX%. well in investments required by a our number remains XX% both term. meet as transactions to and markets robust property major the strong weighted at weighted A exhibit well The Consistent source, us significantly investments with XX% plus with our non-major average quality towards and rising near underwriting portfolio portfolio of return changing average overall and our the geographic that XX% offers opportunities and our loans our and remains office market remains criteria. across strategy, was type investment weighted allocation a comprise rates. type and our LTV sponsorship. and of yield portfolio sectors the and floating short-term credit for platform Our which don't diversified, we foresee attractive a of can as our rate, multi-family of of

over prudently and drove our raised which realize approximately capital forward larger We've our of will remainder of further of again expect quarter we We scale. total $XXX markets us over of the the new originations loans and which In rate benefits prepayments access $XXX typical business made floating close the in quarter, record the fourth significant pipeline the allow $XXX grow senior quarter, on deployment, million million subject with decision low combined capital loans equity, the $XXX had in with current Our first closing to conditions. million. initial first over later to fundings to of common and to funded in in already million resulted quarter. successfully commitments our the

our great performance summary, I we funds strategy two further will a now delivering of shareholders on we deployed may quarter for look depending to prepayments fourth our With the attractive Marcin year pipeline highlighted quarterly we the to a new realize investment executing turn more quarters to will financial on capital, In coming level detailed expect grow to business next three over forward had the the strong continued and success review our new our by the the the returns of and going and over beyond. call in and results. to XXXX forward. be

Marcin Urbaszek

Thank and for Thank good joining morning our you, you everyone. call. Steve,

our next well few financial minutes, capitalization the leverage. as Over will review of metrics our I as

per or Our XXXX. per or and GAAP $XX.X net year income $X.XX the $X.XX million $XX.X full million for share was fourth share quarter for the

share per quarter full share Taxable $X.XX full and or for for quarter core the $X.XX the $XX.X for was million and share the earnings Our was per per million year. for the or $X.XX fourth per share $XX.X $X.XX fourth income year.

year differences between a the the taxable to of related full fourth time the mainly formation GAAP-to-tax reminder, at our per and As share, We declared from IPO. dividend a $X.XX difference our dividend offers to our GAAP been our of common quarter has brought per share. transaction income resulting dividend believe our that $X.XX our attractive investors. to which current an We yield

share common earnings. Our dividend at was $XX.XX book per our XX was and December exceeding affected value by the

year the the dividends the higher as and deployment capital, earnings over result and costs. LIBOR our Our improved financing a available of lower of successful of largely significantly course

our available in As to last origination we pipeline healthy fourth attractive to mentioned markets current our The to opportunities capital. largely earlier, decided above record capital and of with offering offering continue further Since growth, per flow have week support was combined the $XX XX $XXX the first investment company, the quarter December common generate of at deployed our our to IPO. which since in the share. value per access share our million is equity raised stock book executed we

continues loss billion we $X.X and loan borrowing had of interest will points performing on temporary equity $X.X the with deploy facilities financing a large to two basis total decline contributed over of offering. a see originated five a combined balance to risk for the funds the a cost approximately fourth eight we in on these across new repurchase of with financing December loans. million end, balances currently or quarter overall our quarter-over-quarter. loans would outstanding The our rating with to our drag with total newly of expect either three this non-accrual rate next $XX On improve billion loans, of quarter. XX, As expect don't total no create on XXX% agreements we any portfolio defaulted to and to of impaired common approximately a the facilities four institutions. although, quarters, At reserves was capacity earnings We our outstanding to the during two move loans associated maturity of

loan $XXX XX, and issuing, to at manage to us in to addition of In large October the our million temporarily the we convertible million to financing upsized in bonds subsequently volume also December facility help $XXX short-term closings. January

We mix our of pleased are current with very funding alternatives.

additional diversify with various but a three forms quarter-over-quarter level, CLO it to you including Thank We evaluating joining and other this maintaining whether unsecured but us conditions will of options secured depending level We vary overall our may it anticipate of around activity. actively to And the available securitizations if balance our a our strategy cost quarter are ask to market leverage ended funds, the and We those times through We open to this leverage our further sheet debt. fourth our conditions, that of today. debt-to-equity optimize we on instruments. non-recourse prudent operator ratio financing may I sheet current believe leverage of given is us adjust accordingly investment the for balance now, change. call and again questions. or

Operator

you. Thank

We from Please session. question-and-answer ahead. Rahmani KBW. first the question comes (Operator begin go Instructions) with now will Jade The

Jade Rahmani

any if December in questions. Thanks funds wondering with that being anticipation sellers any to was very much quarter, that there volatile available securitization see I perhaps forced for given debt out give played and disruption the loans? that the perhaps Was being market backdrop the and fourth January on volumes. color the you those originated forced had pause taking of could in also the or you not did market from sell volatility any and loans

Jack Taylor

And volume reasons It's certainly believe people as would one result, there Jack did across including Hi, through small describing you. as reduction CMBS things Jade. This period our board caused widened was us, was that market and be the for I very question. The at were And up would – a of interesting price cautious little volatility by teeing that, asset the Taylor. Good period. and I what selling for mid-January, all resurgence pipelines picked I little it period. CLO-oriented out speak be government wider. did it in a there during a in I'll many was lower spread, was and CLO of Thanks of and bit anticipated quickly what to do any back is that up securitizations. believe with other that shutdown the a though a quarter the out waited uncertainty little freeze CLO that in became very were for try that we forced It succinct during to because up happened. period with early fourth say. market it bid reset that's market or to CLO to say people factors. the widening CLO up true to bit, the come freezing the any was the the I time market significant as for but going and out wider not ourselves that

Jade Rahmani

Okay.

Regarding the that on frame risk give and moved color loans how you will any property it loans to – type resolution and can two those type product the play four time think rating, you geographic were anticipated out? two

Steve Alpart

for it's question. Jade, Thank morning, Steve. Good your you

schedule me in their asset it's always and proactive and plan. with them these just your loans, be an be business. portfolio by Let That apartment renovation is first going ground that's two start to have secured of With our will large that number undergoing assets, question property in plans. is ahead of behind and through part the that currently we as very of retail one New loan of of some business active management natural building a York. process. the With reminder floor to some respect There's on progress properties a schedule a movement some normal with transitional loans

by The hotel second loan a in California. is secured

of that or just the earlier And risk you the expect we a two is ranking loans with a then don't a combined to last these about risk. not of thing X% loans the I loss these everyone And about either which impaired independent confirmed likely we want mention higher mean appraisals loan loans. collateralized. appear that I got as and for is the loans loss does our for January the else four of create balance loan January a of that's that loan to indicate well million said reserve that think in other any for have our of mentioned to month, Marcin reminder XXXX It be us portfolio. two as Marcin for $XX is each third-party for and view

Jade Rahmani

the What's LTV of the average loans?

Steve Alpart

well say recent I the secured would LTVs. on specific probably that they're to is on I want appraisals don't What based go into specifics and

Jade Rahmani

what's And resolution? frame the time for

Steve Alpart

other the don't Time both than frame specifics that service. are for We into well get They're debt current want secured. both saying probably resolution. to on loans

our active management probably specifics to we want of line part process, asset time. at this ongoing time As don't into on go

Jade Rahmani

Okay. The interest one is out cash those other reserves reserves there? how When reserves much loan of service that is will funding be exhausted? debt capacity I and guess,

Steve Alpart

Right.

So a we in as structure, lot reserves all these lot in loans, -- a to we alluded that built for you with of build loans. one have our of of

property For that property that and loan, have cash the flow cash specific service. we have up built -- the suite flow a payment for the from that's from source debt of reserves

As a predict it's very far as the just factors, of time property to that line, difficult how so performance last. would function it's long like other

Jade Rahmani

would Okay. that notable? Any post-year-end be credit migration other

Steve Alpart

I say this about we've the Not see that the mean, at credit is really. expect in would time that the I would overall stable talked overall but already of portfolio context, stable. the portfolio some of credit migration, we and broader to the is

Jade Rahmani

Okay. questions. taking Thanks for the

Steve Alpart

Sure.

Operator

The Please question go comes from with Ben ahead. next Zucker BTIG.

Ben Zucker

close a my taking to everyone. for strong on and questions, congratulations Good morning, XXXX. Thanks

Jack Taylor

Thanks.

Ben Zucker

to liquidity, million of balance and through then work the about through raised had you available how million your convert quick. nice $XX know will year-end hand, you've take your on proceeds, And do about another sheet, Just capital? was and you already so. it you long gone $XXX cash or I you at the looking thinking which think

out like whatever you for you so $XXX year-to-date thinking backing am million funded I have you capacity said just $XXX million. So then or

those numbers then like do there? sound proceeds kind So line fresh deployment of maybe for some of right $XXX million and time

Marcin Urbaszek

depending It receive. I Hi, yeah, to joining on have for type whatever the we reflect we three question. some three of prepays you're capital probably two earnings. say, right. the on minus. and also probably is results quarters probably would and us obviously, all We originate to Benefit, I the prepayments for it's plus or may say quarters Marcin. the and assets also in Thanks $XXX two or invested depends, million again our before would

Ben Zucker

That's helpful, Thanks. Marcin.

turning And last and sheet, balance the market May come just rates financing only warehouse little -- pushed ask finance a in. sit in the from your CLO bit of deal to because today? on your as wider spreads when a it have guys As repo XXXX. what the the like feels really side are you of I have And we thoughts completed

on So, now. I margin, you those how am financing the just right two wondering view sources

Jack Taylor

is This Jack. you. thank Hi,

as Point past, context. we as within our repeat the the we say generally positioned as that As market because think many grow carries one believe a assets benefits that I’d we've And financing the we CLO many CLO CLO said in of and we platform very of issuer Granite in tools. our fit well have organization our

part So first annual And warehouse of compare do we to it funds market, we're the as CLO of evaluation, constantly cost within and execution. lines, the in sales, evaluating of that market. that our light especially successful

it's cost funds. market market. than in while for maybe CLO and our think warehouse sometimes basis, of and through matched So the and general throughout say on lower competitive it's is aggressive the vendors and cost cost of but I of a year we us that firm They reopening. cost the been it meaning on trailing held match funds, July, might a been turmoil to wider their a is would of CLO And December the low have market They're provide last June, experience has lower in year and still funds that May that. us

Ben Zucker

up obviously, non-mark-to-market. and nonrecourse there benefits nice you like And, some pick

hear on of benefits market. the the I'll you CLO So,

Jack Taylor

and nonrecourse is It of cost leverage. non-mark-to-market is. it certainly lower It Right. a can funds, be

Ben Zucker

two to over service with in metrics? the that I'm yields, perspective like the loans. notable and From the in place in thinking or change spreads thinking of about any an coverage debt year debt underwriting and on underwriting those the kind respect even witnessed has But I'm you've market been last not criteria there

Steve Alpart

really. Hey, Steve. Benefit, Not it's

on We’re going the that is loan. -- you no service debt obviously, every think But tailored loan the significant changes. metrics is for coverage debt overall mentioned I LTV underwriting ratio to yield be

Ben Zucker

then repurchase two in of is how that just Very capital one you million for anticipating stock authorization you like know helpful. volatility. last had program And use shares you really put because a quickly, also this pipeline, know just wondering that so full and guys I the December Did any you I were allocation went?

Jack Taylor

Yes, we it. did not of use any

Ben Zucker

Got you.

Okay, thanks that’s from taking again. guys it me for questions. quarter my Great and

Jack Taylor

you. Thank

Marcin Urbaszek

Thank you, Ben.

Operator

The go Citi. next comes question Cyganovich from with Arren Please ahead.

Arren Cyganovich

I is know of we getting to you fully for kind kind everything where respect around With be than around invested. second once the that the would comments XXXX? low. the level outlook they're prepayment what very But is half, And to likely expect year? for full XX% indicated the said Thanks. you of obviously to you your point it be going higher Are to that

Steve Plust

Plust. Steve is this Arren,

million Let's just more far for of to $XXX million a address somewhere $XX so to million see around quarter. moment. prepaid for and surprised the QX something $XXX had We've like be wouldn't we

something full Forward projections XX% would But as or portfolio maturing, year. harder portfolio year to is per of prepaid like prepayments minus we do. are of the is for plus our a expect

do as so can to opportunistically to prospectively. quite extend, to in well needs, done borrowers matured we'll plans business with the we meet the past whose we've work adjust their haven't As loans

Arren Cyganovich

balance made yield you How you do the portfolio, then whenever amendment the the do do terms that? how loan you loosing amendments? the amendments that during I guess of And also fees in potential associated Okay. you with the that hit with book do and you balance

Steve Plust

to about in got we hand got feel pre-existing let and we've Steve market with credit to that respect I'll understand. the the we we've work a exit act we've competitive fees. Marcin and that against fees advantage talk documents that like with. got is got because again. booking This But an we've We

loan So borrower market we out to that gone or as free think market to refinance. to than terms try are any for re-cut the good the and better be had terms

Marcin Urbaszek

depends it's and Marcin. obviously fee, would X Arren, get say every If but is depends between are XX specific on they points. Hi and circumstances, situation basis there's a do we particular on situation. a I fees. somewhere Again it different

Arren Cyganovich

are and Are of itself types tend industrial to guess that multi-family also are more know just currently less any terms in there more areas favoring. you're Okay. I I you on the right portfolio. it any or that there focus of and in attracted now? the market property or types office you to

Steve Alpart

Hi, good the it's what we'll like see Steve. I very forward in going the doing in quarters been look What we've and morning, we'll think much past. two last

from that see office at can and multi-family. presentation You of the two-thirds about our portfolio XX/XX is

in We continue hotel. mentioned we sectors selective and in be as investments continuing you've We're two those to to categories. like retail seen But make to those as past. on the from time time, will we

do a XX%. modestly the as in looking our We couple we from mentioned fourth loans quarter more for that of industrial. industrial increased did always are to exposure We X%

were So things. loans, how healthcare, types and of some steady-state, some then quick no not commentary give we that that's I kind looking what we're those those. not loans in doing away change like land and we stayed are at property from mean construction seeing the of No

Arren Cyganovich

Thank Okay. you.

Operator

Please next The comes with ahead. from question Rick Shane go JPMorgan.

Rick Shane

Hey and the the guys, couple income. fourth of interest just we about quarter? timing if questions I'm quarter. quarter thanks was morning. the wanted originations for the as backloaded taking little wondering net a my this impacting talk if curious that are to things there I a differential in more done early I'm through was convert in move were And obviously the a

Marcin Urbaszek

the close loans the Yes, from some timing capital the there's the margin was our difference. Eric majority of I the definitely there income from for closed joining it's definitely raised Thank more interest good you would of October, we net obviously the -- recognized later morning, quarter, us. expense Marcin. interest later interest in say that sooner on the half than loans on drag so year. some in first

Rick Shane

it. Got

Okay.

is related and movements your we any there month how related Second resets re-price question, or others? that aware to slower think LIBOR, than liabilities about to NIM. in some due, of faster When and be assets should differential you again timing one

Marcin Urbaszek

around mismatch No really. no the revise is generally real not They there. time. There same

Rick Shane

if slower question. Got it. trade-off your yield? building of origination sheet? bit are gap the see there that slow with will because with little coupon the narrows, the pick accretion of associated up, So all-in between of the also And we Is cash trade-off if for look repayments repayments less balance the stated yields see pickup repayments that? the would example repayments a -- you help and your Is is that all-in then last in to slower terms in fees

Marcin Urbaszek

yes. it's the when remaining its of and forward, of that before think, there accretion I state recognize. loan bring we the obviously effect. We is in repays so maturity, some Look yield

Rick Shane

it. drill on Got little bit that. more going in a I'm to

of actual between of has between you the what you provide expected I yield What -- when sort when of basis makes creating last coupon show of it's -- think Presumably schedule the you coupon cash an your in look quarters do schedule of that would -- X.XX you you slower repayment data? yield than repayments. So, a assumes that an terms portfolio of assumption the repayment cash your X.XX show in all-in been and two the points all-in that yield? appreciably all-in drag terms over

Marcin Urbaszek

these to don't something. we these funding. project report do clarify not publish project our yield, Just and we yields prepayments. we origination future When at numbers, When we are

And we fees fundings X a loan even X-year if those future the all that over X, a loan not fundings has maturity future years. have get do is plus if the loan is a it, this X this amortizes in that that's -- funded. So plus assume we three

We is So straightforward itself. origination. it changes numbers not at yield adjust for do any to relatively loan the calculation, those a it's

helps. that hopefully So

Rick Shane

in looking actually was I immensely. at Thank That helps you. it actually reverse.

So helps. thanks that

Marcin Urbaszek

You’re welcome.

Operator

next with Instructions] [Operator comes Laws The question Stephen from Raymond James.

Stephen Laws

morning. or like been year they originated questions. about should Good lumpiness Hi. lot A But questions. share? talked seasonality on full you X Jack, XXXX Are investments this XXXX. XX X questions. thoughts this the in to the guess for all one-year lumpiness or of year. a your taking repayments specifically with Thanks or of look well I three-year the late two around extensions your of I lot guess, touched about kind early to on have seasonality previous guys assets think repayments Are I any as and couple how in or a my those breakout there like as has early that

Jack Taylor

Okay.

So am X, as trying assets to XX… find I X and

Stephen Laws

and X, X It's X, think. I

Jack Taylor

X, X said, and X, okay. you

could Somebody that to hand me.

off the right. to respect seasonality, seasonality, with first but there vintage -- there's no is Our

you increase closer is So when its progressed life XXXX, when that likely on initial further go is in all its Is being the and plan. to XXXX seasonality? and say, what you're fact asset XXXX would that is term say other things will say likely And an prepayment. at coming the it's getting of business its that over I equal to along or more more

Stephen Laws

will insight go? Yes, just lumpiness that into where do to that to the year. table that breakout pay And you are of Are these this expect loans so, any there larger if those off? any on you

Jack Taylor

you happened to for not XXX has So to happen. Steve fair that XXX going now that give the not. say, best like and that on asset could I us that think specific be encompass we We on those say asset say the knowledge have there would there say did list, -- to I that I of a loan to would number That will come. we be is I have very If within XX prepaid. one another will large this it that do we're that's it's when to specific our X any or not when to anticipate could try we is predict say, Plust numbers

of is And comment might might when that is they that it so the of some initial this to at this and of done term, a coming up where at number mean cautioned these necessarily negotiate because benefit on did term another we or And the business up, company's complicates to want I we borrower. not should just prepayment remind loan the it when of that you, times asset don't the I last to I'll thing looking year the know with with two doesn't about to Even if yield, have it loan I the to significant if prepay. something you we others you I okay, refinanced extend from to is on soon. that might us. did say your otherwise that was an and will its anticipate But large just plan. say, it's assets modeling the rework X.X-year know it's away it's maybe mark we're

Stephen Laws

short-term underwriting the Or looked that. short-term or see about year think ago all? changed. do tightening, that Fed. ago, year? going? outlook of later I guess, around where continued are view you maybe in kind your a your even floors? them the can your those talk outlook the on your you I appreciate couple of given it Whether Jack Has this easing now utilizing new comments you outlook Where I so, it's tightening that Great. of guys at quarters a what's And LIBOR rates Around on If on that like rates? has originations, impacted the

Jack Taylor

over not the a first to what comment Feds learned is years I've about ever going prediction do. The to firm the have

Stephen Laws

understand that. I

Jack Taylor

so and react do talk how I'll what how we position we do Right ourselves. is and

is perspective. the any that from not are uncertain though yield the of best some of our rate believing fact, down, positioned markets rates. That's we're and will a in lowering rising to and for fed hurt it's even come rather pace LIBOR view really is be that still increases So, by rates

that it know the So, compression has happening. cushioned is an we Fed rise had in impact are I upward spread for those direct will as pressure some and impact that on of you was indirect of yields, and the on putting that increasing resulted things short-term and which to also the against that our it of say some LIBOR one rates rates well-positioned

little So, it if think of spread were a wasn't XX%. may a go LIBOR there the one-for-one. pressures. If would we LIBOR of be XX%, down to up bit was our be up XX%, Similarly, lessening a yields

route I We personal and floor it to time XXXX it's correlation. a going on not do And pretty that would in do is known. and any happening what Fed XXXX they to a have not is or but the whether over December be they XXXX to market significant not it's view be and has to in think LIBOR, go say the said it's gradualist in always made but range they My clear that XXX to the yet you one-for-one about signaling So, on fashion and has do -- here that need been will, floors, that going supported increase or with so they're now to it. by market them or say we've Steve XXX is incrementalist raising were LIBOR I because something? to of the reactions

Steve Alpart

plus around say XX would points I that. around XX typically or XXX now basis XX Yes, to be minus might it

Jack Taylor

Yes.

have So, our loans floors.

Stephen Laws

runoff realization one when due the formation Great. about Appreciate core those into at question the left tax you what of you color and difference to there. earnings we'll formation over to And the the to Marcin taxable timeframe expect is see the remaining transaction, and how much assets can accrete that? talk income assets

Marcin Urbaszek

don't few forward. like just we done should left, that. but million said I going our dollars financial think Look before -- results is I largely Sure. say this we're it's affect don't largely think significantly I with this would

shouldn't us. be significant just noise, it probably it'll to So, be impact very

Stephen Laws

care. taking forward you. to and guys talking Thank to you later questions you Appreciate Great. look my today. Take

Jack Taylor

Thank you.

Marcin Urbaszek

Thank you.

Operator

the would Jack concludes questions, for closing question-and-answer any turn I no back session. like conference Seeing Taylor over our remarks. to this further to

Jack Taylor

we for And And we everyone speaking business. support appreciate look joining your to to we'd soon. like all of you us again with our today. forward And you really you. Thank thank

Operator

concluded. attending today's now The conference you for has presentation. Thank

now disconnect. You may

Granite Point Mortgage Trust (GPMT) 6 Feb 192018 Q4 Earnings call transcript