Company: CIMO
Filing Date: 2025-02-19
Form Type: 10-K
Source: 0001628280-25-006426
Chunk: 427

Company: CHIMERA INVESTMENT CORP
Filing Date: 2025-02-19
Form: 10-K
Item: Item 7
Chunk 427
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 commercial properties. These investments were purchased at attractive unlevered yields. Finally, we invested $1 billion in floating rate Agency CMOs. These floating rate investments were purchased at levered yields that exceeded the cost of capital from the Company’s unsecured debt issuance. We believe these investments will provide an attractive return while serving as a source of liquidity during intermittent periods as we seek to deploy capital in loans or other investments. 

In 2024, we committed to purchase $1.1 billion of residential mortgage loans, down from $1.4 billion in 2023 and $1.7 billion in 2022. Of such loans, approximately 44% were seasoned RPLs, 29% were Non-QMs, and the remainder were BPLs. Of the $1.1 billion of residential mortgage loans that we committed to acquire in 2024, $130 million were RTLs and $308 million were Non-QM DSCR loans that settled in the first quarter of 2025. Apart from RTLs, all loans purchased were financed or expected to be financed through non-recourse term securitization transactions. The loan characteristics of the seasoned RPLs and BPLs were consistent with the characteristics which currently exist in our portfolio.  

In December 2024, we completed the Palisades Acquisition, providing us with a new fee-based source of income, as discussed below.

Given the challenging operating environment, ongoing liquidity needs, and opportunities to purchase new assets with higher yields, we rebalanced a portion of our investment portfolio. Overall, we sold $38 million Agency CMBS. These sales resulted in a recognized loss of $3.8 million. Additionally, to fund our investment activity and the Palisades Acquisition, we raised $20 million in liquidity through the sale of Agency CMOs during the fourth quarter. These sales resulted in a realized loss of $1.5 million.

Considering the overall investment purchases, sales, and securitization activities, at December 31, 2024, our portfolio consisted of 88% residential mortgage loans, 8% Non-Agency RMBS, and 4% Agency MBS (including Agency CMOs) on a fair value basis. Our Agency portfolio increased by $417 million year-over-year through a combination of purchases and sales of Agency CMOs and sales of Agency CMBS activities.

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Given the interest rate volatility during the year, portfolio valuations remained volatile and ended the year with valuations ranging from flat