- In response to the move in interest rates this summer, Apollo Residential Mortgage (AMTG -0.7%) has taken its book from exposure to rate risk to exposure to credit risk. Agency MBS holdings have been cut to 50% from 59%, with some of that cash used to bring up non-agency holdings to 26% from 21%. To be more specific, the company purchased non-agency floating rate mortgages.
- Not able to specifically discuss book value at the JMP Conference today, management spends a bit of time talking about it anyway. The drop in interest rates this month has had a pleasing effect and - while Q2 was an ugly quarter for book value - Q3 should be relatively benign. Management suggests the large mREIT (REM +0.3%) dividend cuts seen for Q3 is likely to have put payouts at a pretty sustainable rate going forward.
- Presenting alongside, Apollo Commercial Real Estate Finance (ARI +0.9%) management notes its continued investments (mortgages, preferred equity) in NYC's apartment market - about $275M over the last year. The market has just a 2% multifamily vacancy rate.
- Presentation slides.
- Webcast.