Two Harbors Investment Corp. (NYSE: TWO) (the "Company"), a leading hybrid mortgage real estate investment trust (REIT), today announced that the Company has suspended both its first quarter 2020 common stock and preferred stock dividends to preserve liquidity and long-term stockholder value.
"The Board of Directors, together with management, has come to the difficult decision to suspend our first quarter 2020 dividends, as a result of the volatile market conditions related to the COVID-19 pandemic," stated Thomas Siering, Two Harbors’ President and Chief Executive Officer. "We believe this is a prudent part of managing our liquidity, which is the most important objective for our business in these uncertain times. That being said, we have satisfied our margin calls received to date under our financing arrangements."
The Board of Directors will evaluate the Company’s ability to pay dividends in future quarters based upon customary considerations, including market conditions. The Company will also continue to monitor its taxable income and take measures, if necessary, to ensure that it meets the minimum distribution requirements to maintain its status as a REIT.
Unpaid dividends on the Company’s preferred stock shall accrue without interest. No dividends may be paid on shares of the Company’s common stock unless all accrued but unpaid dividends on its preferred stock, and any current dividend then due, have been or contemporaneously are paid in cash, or a cash sum sufficient for such payment has been set apart for payment.
- We have satisfied all of our margin calls under our financing arrangements. While we anticipate market volatility will continue, we have confidence in our ability to meet future margin calls in the near term.
- We continue to focus on maintaining sufficient excess liquidity in our portfolio.
- In response to the strong intervention by the Federal Reserve this week, Agency RMBS retraced a large amount of the spread widening that took place last week.
- This month, we have been de-levering our portfolio so that our economic debt-to-equity is now in the low-to-mid 6’s.
Forward Looking Statements
This press release includes "forward-looking statements" within the meaning of the safe harbor provisions of the United States Private Securities Litigation Reform Act of 1995. Actual results may differ from expectations, estimates and projections and, consequently, readers should not rely on these forward-looking statements as predictions of future events. Words such as "expect," "target," "assume," "estimate," "project," "budget," "forecast," "anticipate," "intend," "plan," "may," "will," "could," "should," "believe," "predicts," "potential," "continue," and similar expressions are intended to identify such forward-looking statements. These forward looking statements involve significant risks and uncertainties that could cause actual results to differ materially from expected results.
Readers are cautioned not to place undue reliance upon any forward-looking statements, which speak only as of the date made. Two Harbors does not undertake or accept any obligation to release publicly any updates or revisions to any forward-looking statement to reflect any change in its expectations or any change in events, conditions or circumstances on which any such statement is based. Additional information concerning these and other risk factors is contained in Two Harbors’ most recent filings with the Securities and Exchange Commission. All subsequent written and oral forward looking statements concerning Two Harbors or matters attributable to Two Harbors or any person.
Two Harbors Investment Corp.
Two Harbors Investment Corp., a Maryland corporation, is a real estate investment trust that invests in residential mortgage-backed securities, mortgage servicing rights and other financial assets. Two Harbors is headquartered in New York, New York, and is externally managed and advised by PRCM Advisers LLC, a wholly owned subsidiary of Pine River Capital Management L.P. Additional information is available at www.twoharborsinvestment.com.
Stockholders of Two Harbors and other interested persons may find additional information regarding the company at the Securities and Exchange Commission’s Internet site at www.sec.gov or by directing requests to: Two Harbors Investment Corp., 575 Lexington Avenue, Suite 2930, New York, NY 10022, telephone 612-629-2500.
Investors: Margaret F. Karr, Investor Relations, Two Harbors Investment Corp., 212-364-3663, firstname.lastname@example.org