Angel Oak Mortgage REIT, Inc.

and welcome to the Angel Oak Mortgage Fourth Quarter 2023 Earnings Call. All participants will be in listen-only mode. Should you need assistance, please signal a conference specialist by pressing the star key followed by zero. After today's presentation, there will be an opportunity to ask questions. To ask a question, you may press star then one on your telephone keypad. To withdraw your question, please press star then two. Please note that today's event is being recorded. I would now like to turn the conference over to Randy Christman. Please go ahead.

Good morning. Thank you for joining us today for Angel Oak Mortgage REIT's fourth quarter and full year 2023 earnings conference call. This morning, we filed our press release detailing these results, which is available in the investor section on our website at www.angeloakreit.com. As a reminder, remarks made on today's conference call may include forward-looking statements. Forward-looking statements are subject to risks and uncertainties that may cause actual results to differ materially from those discussed today. We do not undertake any obligation to update our forward-looking statements in light of new information or future events. For a more detailed discussion on the factors that may affect the company's results, please refer to our earnings release for this quarter and to our most recent SEC filings. During this call, we will be discussing certain non-GAAP financial measures. More information about these non-GAAP financial measures and reconciliations to the most directly comparable GAAP financial measures are contained in our earnings release and SEC filings. This morning's conference call is hosted by Angel Oak Mortgage REIT's Chief Executive Officer, Srini Prabhu, Chief Financial Officer, Brandon Filson, and Angel Oak Capital's Co-CIO, Namit Sinha. Management will make some prepared comments, after which we will open up the call to your questions. Additionally, we recommend reviewing our earnings supplement posted on our website at www.angelokereit.com. Now I will turn over the call to Shreeni.

Thank you, Randy, and thank you, everyone, for joining us today. AngelLoop finished 2023 with another quarter of improvement in our financial results, carrying forward the momentum the company established earlier in the year. This was demonstrated by the inflection point in our performance during the second half of 2023 and continued in quarter four with additional net interest margin expansion. This was the direct result of the strategic decision-making undertaken over the last 18 months. We continue to increase the earnings power of our portfolio while strengthening our balance sheet for sustainable growth. 2023 represented a pivotal year for AOMR, a year in which we successfully delivered results by reducing our balance sheet risk, improving liquidity, and expanding net interest income which showcased the resilience of our operating model and positioned the company for continued growth. It is important to detail some key progress that we have made in creating the opportunity for AOMR to deliver these results. As you recall, in the second half of 2022, amid an increasingly challenging economic backdrop, we made the prudent decision to de-risk our portfolio. Over the past 18 months, we repositioned our whole loan portfolio. strengthened our base of financing, drove out structural operating costs, and kept a keen focus on maintaining strong liquidity. We elected to endure some short-term pain in order to better position the company and its portfolio for long-term success. This has proven to be the correct decision, as 2023 saw the continuation of the Fed Funds rate hiking cycle, and rates rose to the highest level in over 20 years. In spite of this, we returned our business to an attractive position from which to operate going forward. This positioned AOMR to build back the earnings power of the portfolio over the second half of the year while providing us with resources to deploy systematically into attractive opportunities afforded us to our affiliated relationship with Angel Oak Mortgage Lending. It is widely anticipated that in the second half of 2024, the Fed will begin easing monetary policy. If this happens, you would expect earnings to increase due to lower financing costs and improve securitization execution. Additionally, this could reopen areas of capital markets which may be accretive to AOMR's growth plans. In particular, we demonstrated flexibility in our approach to securitization activity in 2023 showcasing the value of the Angel Oak ecosystem. We participated in four securitizations amid a volatile market, keeping our stated goal of averaging one securitization per quarter. We executed both standalone deals and commingled deals alongside Angel Oak entities to securitize over $660 million of high-quality loans, reflecting the different ways that we can bring deals to market Additionally, these securizations allowed us to lower financing costs, further improving our earnings power and net interest income. This improved positioning enabled the company to deploy cash strategically towards the acquisition of newly originated current coupon loans, both growing our balance sheet and expanding our net interest income. In 2023, we purchased a total of $223 million of current market coupon loans. This drove in 28% expansion to a net interest income from the second quarter to the fourth quarter. The weighted average coupons on our unsecuritized whole loan portfolio increased nearly 200 basis points across the year and 95 basis points in the fourth quarter alone. Our GAAP book value improved to 1026 per share as of December 31st, 2023. This was an increase of 10.4% compared to the previous quarter. Our economic book value of $1,354 per share improved by 2.6% versus the previous quarter. Credit risk has been a key discussion point across the industry in the recent quarters. Our rated average 90-plus day delinquency rate across our portfolio of hold and securitized loans was 2.2 as of the end of the year as compared to 1.9 at the end of third quarter while as expected this has trended slightly upward we believe that the trend represents a movement back towards historical averages after sitting at historic lows in the recent years credit risk management is a key competitive strength of ours due to our relationship with the Angel Oak ecosystem, which provides us the ability to adjust credit offering based on our specific desired characteristics. Credit is a risk we choose to own, and we expect our portfolio to continue to perform comparably well. In 2024, we expect to maintain momentum and drive further net interest income growth as we redeploy capital into high-yielding assets. Our portfolio management philosophy is, above all, to focus on maximizing the ROE of our portfolio and ensure that the capital is allocated to its highest and best use. We currently have dry powder that, coupled with expected securitization timing and execution levels, will allow us to continue to purchase newly originated loans on a programmatic basis. As always, these efforts are supported by the credit selection expertise I discussed, as we firmly believe that we possess a critical strategic differentiator in our ability to evaluate opportunities and allocate capital within our desired risk and return characteristics. With that, I'll turn it over to Brandon, who will walk us through the financial performance for the U.N. and quarter in more detail.