CIM-PB Q4 2025 Earnings Call Summary

1Key Financial Results and Metrics

GAAP Net Income: $7 million ($0.08 per share) for Q4; $144 million ($1.72 per share) for the full year.

GAAP Book Value: $19.70 per share at the end of Q4, with a quarterly economic return of -0.9% and a full-year return of +7.4%.

Earnings Available for Distribution (EAD): $45 million ($0.53 per share) for Q4; $141 million ($1.68 per share) for the full year.

Dividend Increase: Raised by 22% to $0.45 per share for Q1 2026, with expectations to maintain this level throughout the year.

Leverage Ratios: Total leverage at 5.1:1; Rico's leverage at 2.4:1.

2Strategic Updates and Business Highlights

Portfolio Diversification: Shifted allocation to 61% loans, 16% agency securities, and 10% non-agency securities, with 11% in lending activities and 1% in MSRs.

Acquisition of Home Express Mortgage: Closed on this acquisition, enhancing capabilities in non-QM loan origination and expanding reach.

Asset Management Growth: Increased third-party AUM from $22 billion to $26 billion; added advisory services to three securitizations.

Operational Integration: Successfully integrated loan data into Palisade's systems, improving legacy portfolio performance.

3Forward Guidance and Outlook

2026 Focus: Continued emphasis on building a diversified residential platform, enhancing liquidity, and growing fee-based income through both organic growth and acquisitions.

Market Expectations: Anticipation of a strong year in 2026, particularly in non-QM loan origination, with projected market growth of 20-25%.

Capital Deployment Strategy: Plans to focus on Agency MBS, MSRs, and selective credit investments while evaluating the balance between selling loans and securitizing them.

4Bad News, Challenges, or Points of Concern

Book Value Decline: Reported a 2.7% decline in book value due to increased value of securitized debt, which outpaced loan value increases.

Economic Return Fluctuations: The economic return on GAAP book value was negative for Q4, raising concerns about short-term performance.

Increased Expenses: Compensation and general administrative expenses rose by $22 million year-over-year, primarily due to acquisitions, which could pressure margins.

5Notable Q&A Insights

Home Express Performance: Q1 2026 is expected to show strong performance despite typical seasonal volume reductions; optimistic about revenue growth.

Dividend Strategy: Management indicated a balanced approach to dividends versus capital retention for growth, with a focus on maintaining EAD coverage.

Non-QM Market Outlook: Anticipated significant growth in non-QM loan origination, with expectations for a robust market in 2026.

Securitization Strategy: Management is evaluating the cost-benefit of selling loans versus retaining them for investment, with a focus on maintaining liquidity and optimizing returns. This summary encapsulates the key financial metrics, strategic initiatives, and outlook for Chimera Investment Corporation, along with challenges and insights from the Q&A session.