AG Mortgage Investment Trust reported a modest 2.4% book value decline to $10.39 per share for the second quarter ended June 30, 2025, resulting in a -0.5% economic return on equity. Net income was $(1.376) million, or $(0.05) per diluted share, with Earnings Available for Distribution (EAD) at $0.18 per diluted share. This EAD did not cover the $0.21 common dividend declared for the quarter.
The company announced a strategic transaction, acquiring an additional 21.4% interest in AG Arc, the parent of Arc Home, increasing its total ownership to approximately 66%. This move was executed through the issuance of common stock with minimal 2% dilution to the June 30 book value. This acquisition is expected to drive significant earnings accretion as MITT positions itself as a vertically integrated platform.
The investment portfolio expanded by 2.3% to $7.3 billion, and the economic leverage ratio decreased to 1.3x from 1.6x in the prior quarter. The EAD experienced a 'onetime drop' due to three commercial loans from the WMC acquisition being placed on nonaccrual, with management anticipating resolution by year-end 2025. Arc Home maintained a breakeven contribution to EAD in Q2 2025.
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