Chimera Investment Corporation · NYSE:CIM
Chimera Investment — Q4 2018 Earnings Presentation
18 slides from Chimera Investment's earnings presentation, Feb 25, 2019
Slide 1: Investor Presentation 4th Quarter 2018
INVESTOR PRESENTATION NYSE: CIM 4th Quarter 2018
Slide 2: Disclaimer
This presentation 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 DISCLAIMER projections and, consequently, readers should not rely
Slide 3: Chimera is a Hybrid Mortgage REIT
CHIMERA IS A HYBRID MORTGAGE REIT Chimera develops and manages a portfolio of leveraged residential mortgage investments to produce an attractive quarterly dividend for shareholders ▪ Established in 2007 ▪ Internally managed since August 2015 ▪ Total Capital $3.7 Billion ▪ Total Portfolio $27.2 Bill
Slide 4: Total Return
TOTAL RETURN Chimera has outperformed mortgage REITs and the S&P 500 since internalization of management Cumulative Total Return* 110% 100% 95% 90% 80% 70% 60% 50% 40% 32% 30% 28% 20% 10% 0% -10% -20% -30% 15 15 15 16 16 16 16 16 17 17 17 17 17 17 18 18 18 18 18 20 20 20 20 20 20 20 20 20 20 20 20 2
Slide 5: Dividends
DIVIDENDS Chimera has paid $4.4 billion in dividends since inception 700 5,000 600 4,000 500 3,000 ) ) s 400 s n n o o i i l l l l i i M M ( ( $ 300 $ 2,000 200 1,000 100 0 0 2008 2009 2010 2011 2012 2013 2014 2015 2016 2017 2018 Period Ending Common Dividends Preferred Dividends Special Dividends C
Slide 6: Dynamic Investment Strategy
DYNAMIC INVESTMENT STRATEGY Chimera focuses on acquiring Residential Mortgage Loans, Non-Agency RMBS, Agency RMBS and Agency CMBS Chimera acquires residential mortgage loans. Chimera utilizes leverage through a combination of Residential securitization, repo and warehouse facilities to manage risk a
Slide 7: Portfolio Composition
PORTFOLIO COMPOSITION 76% of Chimera's equity capital is allocated to mortgage credit Net Investment Analysis(1) Residential Mortgage Credit Portfolio 17 Total Assets: 15.1 billion(1) 16 Residential Agency 15 Mortgage Credit Total Portfolio Portfolio Portfolio 14 13 Agency Portfolio Non-Recourse 12
Slide 8: Loan Portfolio Composition
LOAN PORTFOLIO COMPOSITION Chimera has acquired a unique portfolio of residential mortgage loans comprising 46% of the total portfolio Portfolio Fair Value Seasoned Low Loan Balance Mortgage Portfolio 34% Total Current Unpaid Balance $12.2 Billion 46% Total Number of Loans 139,992 Weighted Average L
Slide 9: The Securitization Process
THE SECURITIZATION PROCESS Chimera has created term-funding through securitization Creation of senior and subordinate bonds $70mm Senior A Note Principal Sold to 3rd Party & Interest $100mm Deposit $100mm Trust Non-Agency Mortgage (Non-Agency RMBS Bond or Loans Collateral) Losses & Interest $30mm Su
Slide 10: Securitization History
SECURITIZATION HISTORY Chimera utilizes the securitization process to create its own differentiated portfolio ▪ Chimera continues to benefit from exercising the option Securitization History to call, restructure and optimize it's securitizations ▪ Chimera has completed 52 deals and securitized $30.4
Slide 11: Agency Portfolio
AGENCY PORTFOLIO Liquidity in Agency Securities enables Chimera to vary it's investments based upon relative value and residential mortgage credit opportunities available in the market 14 12 2.9 10 ) 2.5 s 8 n o i l l i b ( $ 6 0.9 1.0 1.1 2.3 9.2 4 8.3 1.3 1.3 6.9 1.3 1.4 1.8 1.9 2.1 6.8 6.0 1.4 5.
Slide 12: Capital Management
CAPITAL MANAGEMENT Chimera continues to add shareholder value while diversifying its capital structure ▪ Board of Directors expects to declare $2.00 dividends per common share in 2019 ▪ Chimera issued $200 million of Series D preferred stock in January 2019 ▪ Chimera has raised $930 million in prefe
Slide 13: Summary
SUMMARY Chimera has assembled a unique portfolio of mortgage assets with a goal to provide high and durable income to shareholders Dynamic Investment Chimera has developed a diversified portfolio of mortgage backed securities to maximize risk-adjusted returns. Chimera's total return has outperformed
Slide 14: Appendix
Appendix Information is unaudited, estimated and subject to change.
Slide 15: 2018 Securitization Activity
2018 SECURITIZATION ACTIVITY Chimera closed nine securitizations totaling $3.0 billion of loans in 2018 Loan Securitizations CIM 2018-R1 CIM 2018-R2 CIM 2018-R3 CIM 2018-J1 CIM 2018-R4 $169,032,000 $380,292,000 $181,073,000 $380,009,000 $387,222,000 March 2018 March 2018 April 2018 April 2018 June 2
Slide 16: Agency MBS Portfolio and Funding
AGENCY MBS PORTFOLIO AND FUNDING The majority of Chimera's Agency Portfolio consists of highly liquid pass-through securities Agency Securities – As of December 31, 2018 Repo Days to Maturity – As of December 31, 2018 Weighted Security (1) Current Weighted Coupon Average Maturity Principal Weighted
Slide 17: Interest Rate Sensitivity
INTEREST RATE SENSITIVITY Chimera added to its Agency and hedge portfolios during the 4th quarter of 2018 Description - 100 Basis - 50 Basis +50 Basis +100 Basis ($ in thousands) Points Points Unchanged Points Points Hedge Book Maturities Market Value $12,652,784 $12,448,492 $ 12,188,950 $11,876,524
Slide 18: chimerareit.com
Information is unaudited, estimated and subject to change. chimerareit.com