Company: ADAMM
Filing Date: 2025-05-02
Form Type: 10-Q
Source: 0001273685-25-000047
Chunk: 169

Company: ADAMAS TRUST, INC.
Filing Date: 2025-05-02
Form: 10-Q
Item: Part I, Item 2
Chunk 169
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 us appropriately for the risks associated with them, including, without limitation, CMBS, collateralized mortgage obligations, MSRs, excess mortgage servicing spreads, securities issued by newly originated securitizations, including credit sensitive securities from these securitizations, ABS and debt or equity investments in alternative assets or businesses.

80

As of March 31, 2025, the Company’s Recourse Leverage Ratio and Portfolio Recourse Leverage Ratio (as defined in footnotes 4 and 5 to the table under "— Capital Allocation") increased to 3.4x and 3.2x, respectively, from 3.0 and 2.9x, respectively, as of December 31, 2024, primarily due to the financing of highly liquid Agency RMBS.  As of March 31, 2025, 62% of our debt, excluding mortgages payable on real estate and Consolidated SLST CDOs, is subject to mark-to-market margin calls, with 57% of that debt collateralized by Agency RMBS and 5% collateralized by residential credit assets. The remaining 38% has no exposure to margin calls relating to collateral repricing by our counterparties. We anticipate a gradual increase in leverage as we further scale our investment portfolio.  Nonetheless, we remain committed to prudently managing our liabilities and intend to continue pursuing longer-term, non-mark-to-market financing arrangements for portions of our credit portfolio, which we believe will enhance our liquidity management and better insulate the business from potential market dislocations. In support of this strategy, in January 2025, we completed the issuance of $82.5 million of our 9.125% Senior Notes due 2030 in an underwritten public offering, receiving $79.3 million in net proceeds which were predominantly used to purchase Agency RMBS.  In the first quarter of 2025 we also completed two new securitizations of residential loans resulting in approximately $326.3 million of net proceeds to us after deducting expenses associated with the transactions and concurrently redeemed a residential loan securitization with an outstanding balance of approximately $54.4 million.

Looking ahead, we expect to continue to opportunistically dispose of assets from our multi-family portfolio and generate higher portfolio turnover to pursue investments across the residential housing sector with a focus on acquiring assets capable of growing our interest income. We expect to remain selective in acquiring residential credit assets and are committed to prudently managing our liabilities. Our investment and