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Here’s why MFA Financial jumped after extending forbearance

  • MFA Financial rises after they announce that they will be entering a second forbearance agreement with certain counter-parties that extends its forbearance period to June 1, 2020.
  • The last forbearance agreement was due to expire Monday at 6:30 PM ET.
  • Under the new agreement, MFA agrees to pay $150M in cash to participate in counter-parties for reducing its outstanding repurchase obligation balances.
  • As of April 24, 2020, MFA had total cash balances of $430.9M, including $143.8M of cash on deposit with repurchase agreement counter-parties to meet margin calls.
  • Under the second forbearance agreement, the participating counter-parties continue to have a secured interest in the company’s previously unencumbered assets, primarily residential whole loans, real estate owned, cash, and other assets.
  • These assets have an estimated market value of $1.4 billion.

About MFA Financial

MFA Financial, Inc. operates as a real estate investment trust, which engages in the business of investment, on a leveraged basis, in residential mortgage assets including agency mortgage-backed securities, non-agency mortgage-backed securities, and residential whole loans. The company was founded by Stewart Zimmerman on July 24, 1997 and is headquartered in New York, NY.

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