Company: MFAN
Filing Date: 2025-02-20
Form Type: 10-K
Source: 0001055160-25-000004
Chunk: 79

Company: MFA FINANCIAL, INC.
Filing Date: 2025-02-20
Form: 10-K
Item: Item 5
Chunk 79
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7 million of common equity (including partnership interests) and $15.1 million of preferred equity.  During the year ended December 31, 2024, there were no impairment charges recorded by the Company on its investment in loan origination partners. During the year ended December 31, 2023, the Company recorded an impairment charge in earnings of $2.3 million against the carrying value of its investment in one loan origination partner. In 2023, the Company sold a preferred equity interest in one loan origination partner, which was recorded at $6.6 million, and recorded a gain of $0.1 million. During the year ended December 2022, the Company recorded an impairment charge against earnings of $28.6 million against the carrying value of its investment in one loan origination partner, bringing the net carrying value of this investment to zero as of June 30, 2022. This impairment charge was recorded in Provision for credit losses on other assets in the consolidated statement of operations. Further, for the year ended December 31, 2022, the Company recorded a valuation adjustment of $21.9 million against its investment in a loan origination partner that is accounted for at fair value through earnings. Prior to December 31, 2024, the Company had elected to account for certain of these investments pursuant to the fair value option, where changes in estimated fair value were recorded on the statement of operations.  Such changes in estimated fair value resulted in gains/(losses) being recorded of $(3.0) million, $6.4 million and $(21.9) million during 2024, 2023, and 2022 respectively. For certain of the Company’s investments, the interests acquired to date by the Company generally do not have a readily determinable fair value.  Consequently, the Company accounts for these interests (including any acquired options and warrants) in loan originators initially at cost.  The carrying value of these investments will be adjusted if it is determined that an impairment has occurred or if there has been a subsequent observable transaction in either the investee company’s equity securities or a similar security that provides evidence to support an adjustment to the carrying value.  In addition, for certain partners, options or warrants have also been acquired that provide the Company the ability to increase the level of its investment if certain conditions are met.  At the end of each reporting period, or earlier if circumstances warrant, the Company evaluates whether the nature of its