Two Harbors Investment Corp. reports financial results for the second quarter of 2021

Two Harbors Investment Corp. reports financial results for the second quarter of 2021

Quarterly Summary

NEW YORK, August 04, 2021–(BUSINESS WIRE)–Two Harbors Investment Corp. (NYSE: TWO), an Agency + MSR mortgage real estate investment trust (REIT), today announced its financial results for the quarter ended June 30, 2021.

Highlights

  • Generated Comprehensive Loss of $194.6 million, representing an annualized return on average common equity of (40.7)%

  • Reported book value of $6.42 per common share, representing a (9.6)% quarterly return on book value(1)

Declared a second quarter common stock dividend of $0.17 per share

Reported Core Earnings of $51.5 million, or $0.19 per weighted average basic common share(2)

Continued to grow mortgage servicing rights (MSR) portfolio

Post Quarter End Update

Issued 40 million shares of common stock through an underwritten offering for net proceeds of approximately $256.5 million Expect to settle on outstanding commitments of $17.5 billion UPB of MSR through bulk transactions

“The second quarter saw significant spread widening in high coupon RMBS, which impacted the performance of our portfolio,” stated Bill Greenberg, Two Harbors’ President, Chief Executive Officer and Chief Investment Officer. “While the investing environment in RMBS was challenging, our MSR portfolio has continued to deliver attractive returns. Our recent capital issuance together with our available cash positions the company to deploy capital in MSR, and in RMBS when spreads normalize.” (1)

Return on book value is defined as the increase (decrease) in book value per common share from the beginning to the end of the given period, plus dividends declared in the period, divided by book value as of the beginning of the period. (2)

Story continues The following table summarizes the company’s GAAP and non-GAAP earnings measurements and key metrics for the second quarter of 2021 and first quarter of 2021:

Operating Performance Core Earnings is a non-GAAP measure. Please see page 11 for a definition of Core Earnings and a reconciliation of GAAP to non-GAAP financial information.