The following is a summary of the Cherry Hill Mortgage Investment Corporation (CHMI) Q4 2024 Earnings Conference Call Transcript:

Financial Performance:

• Cherry Hill Mortgage reported Q4 net income of $0.29 per diluted share and EAD of $0.10 per share.

• The book value per share decreased from $3.82 from $4.02 in September due to special committee expenses but reveals a stable financial position with $46 million of unrestricted cash.

• Leverage maintained at 5.3 times, reflecting a stable leverage strategy despite market volatility.

Business Progress:

• Internalization of management completed, expected to save $1.1 to $1.6 million in operating expenses in 2025.

• Continued strategic focus on Agency RMBS and selective MSRs, balancing risk and returns effectively.

• Adoption of interest rate derivatives strategies to mitigate interest rate impacts, with notional amounts of approximately $809 million.

Opportunities:

• Internalization aligns management with shareholder interests, improving transparency and efficiency.

• The shift towards Agency RMBS and selective MSR investments reflects strong risk-adjusted return profiles despite the volatile market.

Risks:

• Elevated repo costs at year-end indicate potential challenges in managing borrowing costs.

• Stubbornly high inflation and anticipated fewer rate cuts might impact investment returns.

More details: Cherry Hill Mortgage Investment IR

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