Mfa Financial, Inc. · NYSE:MFA
Mfa Financial — Investor Presentation (November 2011)
16 slides from Mfa Financial's investor presentation, Nov 8, 2011
Slide 1: MFA Financial, Inc. November 2011
November 2011 FINANCIAL, INC
Slide 2: Forward-looking statements
2 When used in this presentation or other written or oral communications, statements that are not historical in nature, including those containing words such as “will,” “believe,” “expect,” “anticipate,” “estimate,” “plan,” “continue,” “intend,” “should,” “could,” “would,” “may” or similar expressio
Slide 3: MFA is an internally managed REIT investing in Agency and Non-Agency Residential MBS
3 MFA is an internally managed REIT positioned to benefit from investment in both Agency and Non-Agency Residential MBS
Slide 4: Experienced Management Team Focused on Residential MBS Opportunities
4 Non-Agency MBS remain available at significant discounts to par value. Agency MBS continue to benefit from a steep yield curve. Our goal remains to generate double-digit ROEs with appropriate levels of leverage. Experienced Management Team Focused on Residential MBS Opportunities
Slide 5: 14.6% Annual Return Since January 2000
5 14.6% Annual Return Since January 2000 Source: Bloomberg *Includes reinvestment of dividends through September 30, 2011 Total Return*
Slide 6: MFA Asset Allocation Strategy
6 MFA Asset Allocation Strategy Investment in Residential MBS Including Both Agency MBS and Non-Agency MBS Information presented with respect to Non-Agency MBS, related repurchase agreement borrowings and resulting totals are presented on a Non-GAAP basis. For a GAAP reconciliation of such items, se
Slide 7: MFA Asset Allocation Strategy
7 MFA Asset Allocation Strategy Investment in Residential MBS Including Both Agency MBS and Non-Agency MBS (1) Adjusted for the impact of Linked Transactions. See Annex 1 for a reconciliation of non-GAAP financial measures. Information presented based on data available at time of loan origination. (
Slide 8: MFA Strategy – Non-Agency MBS
9 MFA Strategy – Non-Agency MBS Deeply discounted purchase price, substantial credit reserve and 5.7% credit enhancement mitigate credit risk * Includes $256.4 million fair value of Non-Agency MBS underlying Linked Transactions. Non-Agency MBS are presented on a non-GAAP basis. For a GAAP reconcilia
Slide 9: Non-Agency MBS – 20 Largest Positions
10 Projections assume defaults well in excess of currently delinquent mortgages Non-Agency MBS – 20 Largest Positions* *Data as of September 30, 2011. FICO scores as of deal origination date. % of Total Portfolio Collateral Type FICO WALA Credit Support (%) 60+ DQ Projected Defaults Projected Princi
Slide 10: Re-securitization – part of a diversified funding strategy
11 Re-securitization – part of a diversified funding strategy Non-Agency MBS MFA Resecuritizations since October 2010 October 2010 February 2011 June 2011 Name of Trust (Consolidated as VIE) DMSI Remic Trust 2010-RS2 CSMC 2011-1R CSMC 2011-7R Securitized Debt Issued $246.3 million $488.4 million $47
Slide 11: Non-Agency Leverage includes Repo and Re-securitization
12 Non-Agency Leverage includes Repo and Re-securitization* Non-Agency MBS Non-Agency Leverage is approximately 2x (debt to equity) This $1 billion of Securitized Debt is permanent financing Non-recourse to the general credit of MFA No mark-to-market No margin calls Un-encumbered Non-Agencies of app
Slide 12: Non-Agency Repo is different today than prior to 2009
13 Non-Agency Repo is DIFFERENT today than it was prior to 2009 Non-Agency MBS Overall systemic leverage is lower Haircuts are much higher Average haircut is 30% Assets are not difficult to price and price volatility is not high relative to haircuts Counterparties (lenders) are well-protected Non-Ag
Slide 13: MFA Financial, Inc.
MFA FINANCIAL, INC
Slide 14: Annex 1 – Reconciliations of Non-GAAP Financial Measures
Information pertaining to MFA’s Non-Agency MBS that are a component of Linked Transactions are reconciled below as of and for the three months ended September 30, 2011 with the most directly comparable financial measure calculated in accordance with GAAP, as follows: 15 ANNEX 1 – Reconciliations of
Slide 15: Annex 1 – Reconciliations of Non-GAAP Financial Measures (cont)
The table below reconciles MFA’s Non-Agency MBS and related repurchase agreement borrowings and securitized debt on a GAAP basis to reflect on a combined basis its Non-Agency MBS and related repurchase agreements underlying its Linked Transactions, which is a Non-GAAP financial measure. Based on thi
Slide 16: MFA Financial, Inc.
MFA FINANCIAL, INC
MFA Financial — Investor Presentation (November 2011) on 6ix