Chimera Investment Corporation Sponsors Two Residential Mortgage Loan Securitizations

Rhea-AI Summary

On April 26, 2021, Chimera Investment Corporation (NYSE:CIM) launched two securitizations totaling $977.1 million: CIM 2021-R3 at $859.7 million and CIM 2021-NR3 at $117.4 million. The CIM 2021-R3 securitization included approximately $730.8 million in senior securities, representing 85% of the capital structure, with Chimera retaining $128.9 million in subordinate interests. The CIM 2021-NR3 had approximately $82.1 million in senior securities, accounting for 70%. The expected weighted average cost of debt is 2.12%, down from 4.14% for prior securitizations.

Positive

• Successful launch of two securitizations totaling $977.1 million, enhancing capital structure.
• Lower expected weighted average cost of debt at 2.12%, resulting in potential increased profitability.

Negative

• None.

On April 26, 2021, Chimera Investment Corporation (NYSE:CIM) sponsored two securitizations totaling $977.1 million, $859.7 million CIM 2021-R3 and $117.4 million CIM 2021-NR3 of seasoned residential mortgage loans. The mortgage loans for both securitizations were from the termination of Chimera’s CIM 2017-1, CIM 2017-5, and CIM 2017-6 securitizations (the “Prior Securitizations”).

Securities issued by CIM 2021-R3, with an aggregate balance of approximately $730.8 million, were sold in a private placement to institutional investors. These senior securities represented approximately 85% of the capital structure. Chimera retained subordinate interests in securities with an aggregate balance of approximately $128.9 million and certain interest-only securities. Chimera also retained an option to call the securitized mortgage loans at any time beginning in April 2024.

Securities issued by CIM 2021-NR3, with an aggregate balance of approximately $82.1 million, were sold in a private placement to institutional investors. These senior securities represented approximately 70% of the capital structure. Chimera retained subordinate interests in securities with an aggregate balance of approximately $35.2 million. Chimera also retained an option to call the securitized mortgage loans at any time beginning in April 2022.

Chimera’s expected weighted average cost of debt of these two securitizations is 2.12% compared to a weighted average cost of debt of 4.14% for the Prior Securitizations.

Disclaimer

This press release includes “forward-looking statements” within the meaning of the safe harbor provisions of the United States Private Securities Litigation Reform Act of 1995. Actual results may differ from expectations, estimates and projections and, consequently, readers should not rely on these forward-looking statements as predictions of future events. Words such as “expect,” “target,” “assume,” “estimate,” “project,” “budget,” “forecast,” “anticipate,” “intend,” “plan,” “may,” “will,” “could,” “should,” “believe,” “predicts,” “potential,” “continue,” and similar expressions are intended to identify such forward-looking statements. Readers are cautioned not to place undue reliance upon any forward-looking statements, which speak only as of the date made. Chimera does not undertake or accept any obligation to release publicly any updates or revisions to any forward-looking statement to reflect any change in its expectations or any change in events, conditions or circumstances on which any such statement is based. Additional information concerning these and other risk factors is contained in Chimera’s most recent filings with the Securities and Exchange Commission (SEC). All subsequent written and oral forward-looking statements concerning Chimera or matters attributable to Chimera or any person acting on its behalf are expressly qualified in their entirety by the cautionary statements above.

About Chimera Investment Corporation

We are a publicly traded REIT that is primarily engaged in the business of investing, on a leveraged basis, in a diversified portfolio of real estate assets, including mortgage loans, Non-Agency RMBS, Agency CMBS, Agency RMBS, and other real estate assets.

Please visit www.chimerareit.com for additional information about the Company.

View source version on businesswire.com: https://www.businesswire.com/news/home/20210429005888/en/

FAQ

What is the total amount of the securitizations announced by Chimera Investment Corporation on April 26, 2021?

The total amount of the securitizations announced is $977.1 million.

What is the weighted average cost of debt for the new securitizations CIM 2021-R3 and CIM 2021-NR3?

The expected weighted average cost of debt for the new securitizations is 2.12%.

What percentage of the capital structure do the senior securities of CIM 2021-R3 represent?

The senior securities of CIM 2021-R3 represent approximately 85% of the capital structure.

When can Chimera call the securitized mortgage loans for CIM 2021-R3?

Chimera can call the securitized mortgage loans for CIM 2021-R3 starting in April 2024.

When were the securitizations CIM 2021-R3 and CIM 2021-NR3 sponsored?

The securitizations CIM 2021-R3 and CIM 2021-NR3 were sponsored on April 26, 2021.