Business Context and Reporting Period
This Form 8-K is filed by AG Mortgage Investment Trust, Inc. (MITT) on November 6, 2020, reporting events occurring on November 5, 2020. The filing primarily serves to announce the Company's financial results for the fiscal quarter ended September 30, 2020, via an attached press release (Exhibit 99.1), and to disclose corporate governance changes and dividend declarations.
Key Financial Metrics and Dividend Declaration
The filing does not provide specific numerical values for revenue, profit, cash flow, margins, debt, or liquidity for the quarter ended September 30, 2020, as these details are contained in the attached press release which is incorporated by reference but not reproduced in the text of this 8-K.
However, the filing discloses the following specific financial actions regarding preferred stock dividends:
- Dividend Declaration: The Board declared dividends for the fourth quarter of 2020 and all accrued/unpaid dividends in arrears for three series of preferred stock.
- Payment Date: December 17, 2020.
- Record Date: November 30, 2020.
- Per Share Amounts:
- 8.25% Series A: $1.54689
- 8.00% Series B: $1.50
- 8.000% Series C: $1.50
- Book Value Impact: The Company's book value as of September 30, 2020, did not include accruals for these dividends. Consequently, book value will decrease by the amount of the declared dividends.
Material Changes and Corporate Governance
Personnel Change: Alison Halpern, Chief Accounting Officer and Principal Accounting Officer, is on maternity leave. Anthony Rossiello, the Company's Controller, was appointed as the acting Principal Accounting Officer effective November 5, 2020, for the duration of Ms. Halpern's leave. Mr. Rossiello has over 11 years of experience in the banking and mortgage REIT industry and is a Certified Public Accountant.
Financial Condition: The declaration of dividends in arrears indicates a resolution of prior payment delays on preferred stock, though the filing notes that book value will be reduced by this declaration.
Outlook, Risks, and Forward-Looking Statements
The filing includes extensive forward-looking statements regarding investment strategy, liquidity, and returns. Key risks and uncertainties identified include:
- COVID-19 Impact: Economic uncertainty, government responses, and the impact of the CARES Act forbearance programs.
- Market Conditions: Changes in interest rates, the yield curve, and fair value of assets (including potential margin calls).
- Asset Performance: Prepayment rates, default rates, delinquencies, and recovery rates on loans and investment securities.
- Financing: Ability to obtain and maintain financing arrangements in disrupted financial markets.
- Regulatory: Ability to maintain REIT qualification and Investment Company Act exemptions.
- Dividends: Uncertainty regarding the ability to reinstate quarterly dividends on common stock and make future distributions.
Investor Verification Checklist
- Review the attached Press Release (Exhibit 99.1) for specific Q3 2020 financial metrics (revenue, net income, FFO, leverage ratios) not detailed in this 8-K text.
- Verify the total cash outflow required for the declared preferred dividends in arrears and Q4 2020 to assess immediate liquidity impact.
- Monitor the Company's ability to reinstate common stock dividends, as explicitly noted as uncertain in the risk factors.
- Assess the impact of the temporary change in Principal Accounting Officer on financial reporting continuity.
- Confirm the Company's compliance with REIT requirements given the declaration of dividends and current market conditions.