New York Mortgage Trust Inc. (NASDAQ:NYMT) Q1 2018 Earnings Conference Call - Final Transcript

May 04, 2018 • 09:00 am ET


New York Mortgage Trust Inc. (NASDAQ:NYMT) Q1 2018 Earnings Conference Call - Final Transcript


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Good morning, ladies and gentlemen, and thank you for standing by. Welcome to the New York Mortgage Trust First Quarter 2018 Results Conference

Call. [Operator Instructions].

A press release with New York Mortgage Trust First Quarter 2018 Results was released yesterday. The press release is available on the Company's website at Additionally, we are hosting a live webcast for today's call, which you can access in the Events & Presentations section of the Company's website.

At this time, management would like me to inform you that certain statements made during the conference call, which are not historical, maybe

Deemed forward-looking statements within the meaning of the Private Securities Litigation Reform Act of 1995.

Although, New York Mortgage Trust believes that expectations reflected in any forward-looking statements are based on reasonable assumptions, it can give no assurance that its expectations will be attained. Factors and risks that could cause actual results to differ materially from expectations are detailed in yesterday's press release and from time to time in the Company's filings with the Securities and Exchange Commission.

Now at this time, I would like to introduce, Steve Mumma, Chairman and CEO. Steve, please go ahead.

Steve Mumma

Thank you, Operator. And good morning everyone and thanks for being on the call. Included in the 8-K filing yesterday was our earnings press release for the first quarter 2018 results. The Company delivered a GAAP net income of $0.21 per common share and had comprehensive loss of $0.01 per share for the first quarter. Our book value per common share was $5.79, a decrease of 3.5% from December 31, 2017 resulting in an economic loss for the quarter of 17 basis points or less than 1% on an annualized basis.

The Company did continue to benefit from our multifamily credit strategy, particularly, the Company's K-Series investments, which contributed nicely to both our net interest income as well as our portfolio valuation improvements from continued credit spread tightening, which helped offset some of the valuation pressure from our Agency RMBS portfolio.

Company's net interest margin for the first quarter expanded by 47 basis points

From the prior quarter to 286 basis points.

All this in the backdrop of what is currently a very challenging market environment for fixed-income strategies, where short-term liability costs are rising, overall, interest rate volatility is increasing, resulting in higher hedging costs and placing downward pressure on some of our strategies.

On the acquisition side, the quarter was relatively quiet. We continue to grow our credit portfolio, adding approximately $34 million in multifamily in second mortgages. The build in credit assets remains gradual as the demand for credit assets continues to be highly competitive.

I would like to now go over some of the highlights for the period ending March 31, 2018. We had net income attributable to common shareholders of $23.7 million or $0.21 per basic common share. We had a comprehensive income loss of $0.8 million or $0.01 per share, which was primarily the result of a decrease in valuation