New York Mortgage Trust, Inc.

Good morning, ladies and gentlemen, and thank you for standing by. Welcome to the New York Mortgage Trust's second quarter 2021 results conference call. During today's presentation, all parties will be in a listen-only mode. Following the presentation, the conference will be open for questions. If you have a question, please press star followed by the number one on your touchtone phone. If you would like to withdraw your question, please press the pound key. If you are using a speaker equipment, we do ask that you please lift the handset before making your selection. This conference is being recorded on Friday, August 6, 2021. A press release and supplemental financial presentation for New York Mortgage Trust's second quarter 2021 results was released yesterday. Both the press release and supplemental financial presentation are available on the company's website at www.nymtrust.com. Additionally, we are hosting a live webcast of today's call, which you can have access in the Events and Presentations section of the company's website. At this time, management would like me to inform you that certain statements made during the conference call, which are not historical, may be deemed forward-looking statements within the meaning of the Private Securities Litigation Reform Act of 1995. Although New York Mortgage Trust believes the expectations reflected in any forward-looking statements are based on reasonable assumptions, it can give no assurance that expectations will be attained. Factors and risks that could cause actual results to differ materially from expectations are detailed in yesterday's press release and from time to time in the company's filings with the Securities and Exchange Commission. At this time, I would like to introduce Steve Mumma, Chairman and CEO. Steve, please go ahead.

Thank you, Operator. Good morning, everyone, and thank you for being on the call. Jason Serrano, our president, will be speaking to our investment portfolio strategy, and Christine Nario, our CFO, will be speaking in more detail about our financial results today. We will all be speaking to our supplemental financial presentation that was released yesterday after the market closed, and it's available on our website. We will allow questions following the conclusion of our presentation. The company had solid second quarter results. with our gap earnings per share of 11 cents and our comprehensive earnings per share of 12 cents, and our book value increased to $4.74, generating a total economic return for the quarter of 2.8%. Moreover, the company's portfolio net margin for the quarter was 55 basis points higher than a previous quarter, benefiting from improvements in asset yields and decreased average funding costs from our liabilities. The company took advantage of the lower interest rate environment, accessing the market with two capital markets transactions. In April, the company completed a private placement of $100 million of rated senior unsecured notes with a five-year term and an interest rate of 5.75%. In July, the company completed offering of its Series F preferred stock for net proceeds of approximately $139 million with a coupon of 6.875%. The company used approximately $105 million of these proceeds to redeem our 7.875% Series C preferred stock, thereby lowering our cost of capital by 100 basis points. While the company indeed benefited from the lower interest rate environment, we also believe our execution of these two transactions at improved pricing levels validates the strength of our current balance sheet. Now going to page six in the supplemental, you'll see our investment portfolio totaled $3.2 billion at the end of the quarter, and our market capitalization was $2.2 billion, both unchanged from the previous quarter. Our capital is currently allocated at 77% to single-family and 21% to multifamily. Our portfolio growth continues to focus on credit investments, as we believe we can generate better risk-adjusted returns with more stable fundings. On slide seven, we highlight some of our key developments during the quarter, where we declared a 10-cent common stock dividend and generated a total rate of return on our common stock of 2.2% for the period, and we currently have a year-to-date total rate of return of 26.6%. We purchased approximately $258 million in residential loans and closed on our second multifamily joint venture investment for $12 million. On our financing efforts, we completed our first BPL revolving securitization, for a total amount of $167 million. Jason will speak to this in more detail later in the presentation. We completed a private placement of rated unsecured notes with a five-year term and an interest rate of 575, our lowest cost of term financing in company history. In July, we issued our first rate of preferred stock offering, raising approximately $135 million with an initial rate of 6.875. We continue to focus on long-term financing options to fund our growing business to help us navigate the ever-changing financial landscape. On slide nine, we go over portfolio metrics on a quarter-over-quarter comparison. As I said before, our net margin for the second quarter was 2.97%, an increase of 55 basis points from the previous quarter. Our portfolio weighted average yield was 6.31%, an improvement of 28 basis points. The increase was largely attributable to the continued rotation out of lower-yielding QSIP securities to higher-yielding residential loans, including business purpose loans. Our funding costs improved by 27 basis points during the quarter, as the impact of calling one of our securitizations late in the first quarter was fully reflected in the second. In July, we called 2020 SP1 residential securitization in anticipation of issuing a new securitization in the third quarter. The SP1 circularization had a maximum cost of 4%, which we believe we can replace with costs in the low 2% range this quarter. Our leverage remains low at 0.3 times, and our liquidity remains strong as we head into the third quarter. At this time, I'd like Christine Nari, our CFO, will now go over the financial results in more detail. Christine.

Thank you, Steve. Good morning, everyone, and thank you again for being on the call. In discussing the financial results for the quarter, I will be using some of the information from the quarterly comparative financial information section included in slides 23 to 30 of the supplemental presentation. Slide 10 summarizes our activity in the second quarter. We acquired residential loans for $258 million, closed on a multifamily joint venture investment for $12 million, and purchased $19 million of investment securities. We sold residential loans in CMBS for proceeds totaling $15 million. We also had total repayments of approximately $309 million, primarily from our residential loans. Most of these residential loans were purchased at a discount, and the early payoff of the loans resulted in additional income of approximately $5 million, which is included in realized gain. We also had four multifamily loans that redeemed, which generated $1.5 million of redemption premium income, which is included in other income. We had net income of $43 million and comprehensive income of $47 million attributable to our common stockholders. Our book value ended at $474 up from $471 the previous quarter. Slide 11 details our financial results. We had net interest income of $31.5 million, an increase of $1.1 million from the previous quarter. Total net interest income increased from the previous quarter, primarily due to our continued investment in higher yielding business purpose loans, which contributed to the 2.1 million increase in total interest income. This was partially offset by an increase in total interest expense of one million, primarily attributed to the interest expense recognized on the senior unsecured notes issued in April. We had non-interest income of 43.3 million mostly from net unrealized gains of $23.9 million due to continued improvement in pricing on our assets, particularly our non-agency RMBS and CMBS securities, residential loans, and our investment in consolidated SLST. In addition, lower interest rates drove modest price appreciation on our agency RMBS securities. We also generated $5 million of net realized gains primarily from residential loan prepayment activity. In addition, our multifamily preferred equity investments accounted for as equity contributed $6.4 million of income, which includes $5.5 million of preferred return income and $0.8 million of unrealized gain. Our other equity investments contributed $4.3 million of income, primarily from income recognized on redemption of an equity investment that invested in residential loans. We had total G&A expenses of $12.5 million, an increase of approximately $1.1 million from the previous quarter. The increase can be attributed to annual awards and equity compensation to non-employee directors during the quarter. We had operating expenses of $10.6 million during the quarter, which included $6.7 million related to our portfolio investments. This increase primarily due to the growth of the business purpose loan portfolio. and 3.9 million of operating expenses related to multifamily apartment properties that we consolidate in accordance with GAAP. As I mentioned earlier, included in our results for the quarter is the net income activity related to multifamily apartment properties that we consolidate in our financial statements in accordance with GAAP. These properties generated operating income of 2.1 million and incurred interest expense and operating expenses of 0.4 million and 3.9 million respectively. After reflecting the share in the losses to the non-controlling interest of $1.6 million in total, these multifamily apartment properties incurred a net loss of $0.6 million for the quarter. It should be noted that the net loss in these properties includes depreciation and amortization related to real estate. The graph on slide 11 illustrates the change in our book value from June 30. Our book value increased to 474 during the quarter and increased 9% from the end of June 2020. Our stock price has also recovered significantly, increasing our price-to-book ratio to 0.94 from 0.60 at the end of June 2020. We continue to focus on growing and strengthening our balance sheet by investing in our core strategies of single-family and multifamily investments. and prudent liability management by placing greater emphasis on procuring longer-term and more committed financing arrangements. Jason will now go over the market and strategy update. Jason?