The reason the dividend is safe is the coverage of earnings is high enough to cover it. The paper loss on the MBS is just that a paper loss. The rates increase with the MBS postion is going to hurt NIM, yet the paper loss will workout to net zero. It is the same as if you had the MBS---you get the interest and your money back. The problem is that MBS bought them with borrowed money---borrowed at short term rates. So if short term rates go above 4% then MBS lose money. Profitablity is going to be hurt anyway since NIM and gains sales of loans(which also drops with rising rates) need to cover bank expense.
This company is always talking about shareholder value and as a RSLN shareholder they always stressed the importance of the dividend and stock buybacks. Rsln was so proud each quarter when they raised the dividend. I am sorry I have not run any number's on the company's losses but knowing the management of this company I just can't see them touching the dividend. They will try to save the dividend and a cut would be a last resort. I would be shocked if they cut the dividend and a dividend cut is not priced in the stock.