NEW YORK–(BUSINESS WIRE)–On July 26, 2016, Freddie Mac announced that Chimera Investment Corporation (NYSE:CIM) was the winning bidder for Freddie Mac’s pilot structured sale of seasoned mortgage loans that Freddie Mac currently guarantees and holds in its mortgage-related investments portfolio. This transaction is part of Freddie Mac’s guaranteed re-performing loan (RPL) securitization program (approximately $24 billion securitized to date) and non-performing loan (NPL) sales program ($4.3 billion sold and settled through March 31, 2016).
Chimera, either directly or through a wholly-owned subsidiary, is expected to acquire and simultaneously securitize the seasoned re-performing residential mortgage loans with an unpaid principal balance of up to $199 million. Freddie Mac is expected to guarantee and purchase the senior tranches of the securitization and Chimera, or an affiliate, will retain the first loss subordinate tranche which will be subject to the risk retention requirements. Chimera expects the transaction will close in October 2016.
“We are pleased to work with Freddie Mac on this pilot program and look forward to additional opportunities to expand our portfolio of risk retention investments” said Matthew Lambiase, Chimera’s President and CEO.
Other Information
Chimera Investment Corporation invests in residential mortgage loans, residential mortgage-backed securities, real estate-related securities and various other asset classes. The Company’s principal business objective is to generate income from the spread between yields on its investments and its cost of borrowing and hedging activities. The Company is a Maryland corporation that has elected to be taxed as a real estate investment trust (“REIT”).
Disclaimers
This press release shall not constitute an offer to sell or the solicitation of an offer to buy Chimera’s common stock or any other securities, and there shall not be any offer, solicitation or sale of securities mentioned in this press release in any state or jurisdiction in which such offer, solicitation or sale would be unlawful prior to registration or qualification under the securities laws of any such state or jurisdiction.
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. These forward-looking statements involve significant risks and uncertainties that could cause actual results to differ materially from expected results, including, among other things, the ultimate structure and terms of any sale of loans by Freddie Mac to the Company.
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.
Chimera Investment Corporation to Sponsor Residential Mortgage Loan Securitization - Business Wire (press release)
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