CHIMERA INVESTMENT CORP
For the period ended Dec 31, 2025. Filed Feb 18, 2026.
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A company's yearly report to the SEC, with audited financial statements. It is the fullest account a company gives of its business, its finances and the risks it sees.
FY2025 · Filed Feb 18, 2026
CIM$7.31-7.7%Stored close · as of Nov 6, 2026
What changed in Management’s Discussion and Analysis?
Read the current filingPrevious report: 10-K
Period ended 2024-12-31; filed 2025-02-19.
0001628280-25-006426
Item 7. MANAGEMENT’S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONSCurrent report: 10-K
Period ended 2025-12-31; filed 2026-02-18.
0001409493-26-000017
Item 7. MANAGEMENT’S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONSThe baseline is this issuer’s latest earlier reporting period of the same form that was filed before the current report. A previous 10-Q is a different quarter, not a year-over-year comparison. Amendments are excluded.
Compared 244 previous paragraphs and 326 current paragraphs.
91 unchanged; 93 reworded; 136 added; 56 removed; 4 previous and 6 current paragraphs rearranged.
Tables are not compared: 23 previous and 26 current tables excluded. Dates, whitespace, punctuation and numbering changes are ignored; changes to financial figures remain significant.
A changed paragraph is not evidence that risk increased or decreased. An unchanged paragraph does not establish that risk stayed the same.
Added paragraphs (136)
Current report
We are a diversified real estate company that invests in, originates, and manages primarily residential real estate assets. The assets we may invest in and manage for others, through our wholly-owned subsidiary PAS, include residential mortgage loans, Non-Agency RMBS, Agency RMBS, business purpose loans (including RTLs) and investor loans, MSRs and other real estate-related assets such as Agency CMBS, junior liens and HELOCs, equity appreciation rights, and reverse mortgages. Also, through our wholly-owned subsidiary, HomeXpress, we originate consumer Non-QM and investor business purpose residential mortgage loans as well as QM residential mortgage loans.
Current report
In 2025, we reevaluated the composition of our reportable segments based on changes in the significance of certain business activities, including the acquisition of HomeXpress, and the manner in which our management reviews operating results and allocates resources. As a result of this reevaluation, we report as two reportable segments: (i) Investment Portfolio, and (ii) Residential Origination. The Investment Portfolio segment consists of our investments and third-party advisory services activities. The Residential Origination segment consists of the stand-alone mortgage origination business of HomeXpress that originates consumer Non-QM, investor business purpose, and other Non-Agency and Agency mortgage loan products.
Current report
As of December 31, 2025, based on the fair value of our interest earning assets, approximately 65% of our investment portfolio was allocated to residential mortgage loans, 23% to Agency MBS, 5% to Non-Agency RMBS and less than 1% to interests in MSR financing receivables (excluding loans held for sale by HomeXpress). As of December 31, 2024, based on the fair value of our interest earning assets, approximately 88% of our investment portfolio was allocated to residential mortgage loans, 4% to Agency RMBS, and 8% to Non-Agency RMBS.
Current report
We utilize a variety of channels, including securitizations, warehouse facilities, repurchase agreements and other capital market activities to finance our investments, manage liquidity, improve capital efficiency, support the implementation of our investment strategies, as well as to enhance our potential return on equity. We manage interest rate risk using hedging instruments such as interest rate swaps, swap futures, treasury futures, swaptions, and interest rate caps.
Current report
Our investment strategy is intended to be durable across a variety of economic, rate, and credit environments. We seek to approach portfolio management in a disciplined manner and expect to operate in an environment characterized by ongoing uncertainty related to global trade dynamics, fiscal and monetary policy, inflation, labor market conditions, economic growth, and domestic and geopolitical tensions.
Current report
During the fourth quarter we completed the HomeXpress Acquisition, which closed on October 1, 2025. We raised liquidity through staggered sales of select assets, some of which we sourced from our Agency RMBS liquidity allocation and the rest from what we viewed to be fully priced Non-Agency RMBS positions. Separately, we also issued unsecured debt.
Current report
The HomeXpress Acquisition represents a strategically significant milestone and broadens our business capabilities. We expect that this acquisition will provide us with direct exposure to the growing residential consumer Non-QM and investor business purpose mortgage loan origination market and will enhance the diversification of our earnings sources beyond our core investment activities. As of December 31, 2025, loans held for sale by HomeXpress constituted approximately 6% of our interest earning assets based on fair value.
Current report
HomeXpress is a specialty mortgage lender focused primarily on providing first lien, consumer Non-QM loans, and investor business purpose solutions to the residential housing market on a national basis through mortgage brokers and bankers. Non-
Current report
QM loans are designed for borrowers who do not meet traditional qualified mortgage standards and typically carry higher interest rates and offer more flexible solutions for potential borrowers. Investor business purpose loans are secured by first liens on non-owner occupied 1–8 unit investment rental properties. HomeXpress is a leading originator of these residential mortgage loans and does so substantially on a wholesale basis through independent mortgage brokers and bankers. HomeXpress currently sells all the loans it originates on a servicing-released basis to third-party institutional investors. Warehouse financing is used by HomeXpress to fund these loans from origination through sale. While the residential real estate market and associated mortgage loan origination volumes are heavily influenced by economic factors such as interest rates, housing prices and employment conditions, additional loan origination growth for HomeXpress is expected to be realized from further development of its existing wholesale origination network as well as from the growth in its recent implementation of a non-delegated correspondent channel. Additional growth is also expected from expansion in its FHA, VA and conventional agency-conforming channel and the implementation of delegated correspondent lending platform.
Current report
Interest Rates, Inflation, Labor Markets, and Economic Activity
Current report
Interest rates across the U.S. Treasury curve fluctuated throughout the year as market expectations regarding the timing and magnitude of policy easing evolved in response to incoming inflation, labor, and economic data. Short-term interest rates declined over the course of the year alongside expectations for easing monetary policy, while longer-term Treasury yields declined more slowly reflecting continued inflation uncertainty and term-premium dynamics.
Current report
Inflation, as measured by the Consumer Price Index (“CPI”), moderated at times during the year but remained above the Federal Reserve’s stated 2.0% objective. CPI inflation ranged between 2.3% and 3.0% on a year-over-year basis during 2025 and ended the year at 2.7%. Shelter costs continued to be a significant contributor to overall inflation, with rates of increase that generally exceeded those of goods and energy prices.
Current report
Labor market conditions moderated over the course of the year but remained relatively resilient. The unemployment rate increased to 4.4% at year-end, but still remained historically low, while job gains and broader indicators pointed to an easing labor market trajectory. Economic activity remained solid as real gross domestic product increased at an annualized rate of 3.8% in the second quarter and 4.4% in the third quarter of 2025.
Current report
With this backdrop, the Federal Reserve held short term rates steady through the first half of 2025 and eased 25 basis points at each of the final three Federal Open Market Committee meetings, bringing the yearend federal funds target range between 3.50% and 3.75%.
Current report
Consistent with these dynamics, the yield curve evolved with a steepening bias during 2025. The two-year Treasury yield dropped 77 basis points during the year to 3.47%, while the ten-year yield declined just 39 basis points, resulting in the yield curve steepening by 38 basis points during 2025.
Current report
U.S. housing market conditions in 2025 were shaped by continued affordability challenges and an ongoing imbalance between housing supply and demand. While mortgage interest rates, home prices, insurance costs, and property taxes continued to pressure homebuyer affordability, several of the largest drivers showed signs of easing over the course of the year.
Current report
According to the Freddie Mac Primary Mortgage Market Survey, the average 30-year fixed mortgage rate declined from 6.85% at the beginning of the year to 6.15% at year-end, a decrease of approximately 70 basis points, with most of the decline occurring in the second half of 2025.
Current report
Housing supply conditions remained constrained, particularly in the existing home market, as elevated mortgage rates continued to limit homeowner mobility. Existing home inventory increased modestly during the year but remained below long-term averages. In contrast, new home supply and construction remained relatively more active. Homebuilders continued to support transaction volumes through the use of mortgage rate buydowns and other incentives, which helped offset affordability pressures and support new home sales despite higher headline financing costs.
Current report
Home price growth moderated relative to prior years, and year-over-year national home price appreciation ended the year below consumer wage growth, representing a step toward easing affordability challenges.
Current report
During 2025, we focused on diversifying the portfolio and repositioning the Company as a diversified, vertically integrated residential real estate platform. To execute on these objectives, we exercised redemption rights with respect to several securitized transactions and raised capital organically through re-securitizations of the underlying mortgage loans and loan sales to third parties. We also raised capital through monetizing certain fully valued assets as well as through the issuance of senior unsecured debt. These activities provided the capital necessary as we expanded our platform and mortgage lending capabilities through the acquisition of HomeXpress, increased our allocation to liquid Agency RMBS, made our first investment in MSRs, and began to reshape our allocation of capital, investment mix, and sources of income and earnings.
Current report
Full Year and Fourth Quarter 2025 Business Highlights - Investment Portfolio Segment
Current report
Investment Activity
Current report
Asset Purchases
Current report
Agency RMBS. Predominantly starting with the second quarter and through the rest of the year 2025, we purchased approximately $4.3 billion of Agency RMBS, taking advantage of relative value opportunities while simultaneously increasing our liquid securities allocation. These investments allow us to deploy capital in a relatively expedient manner upon raising funds through capital market transactions, asset divestitures, portfolio run-off, or other means and enable us to maintain liquidity that we can access for future investments or other strategic objectives, including business acquisitions. During the fourth quarter we added $606 million of Agency RMBS, net of sales.
Current report
MSR Investment. During the third quarter, we gained exposure to a $6.5 billion pool of Fannie Mae MSRs through a third-party servicing partnership. The weighted average interest rate on the loans at the time of acquisition was 4.02% and the weighted average LTV ratio and borrower credit score was 71% and 754, respectively. The purchase price for this investment was $38 million, which represented the net asset value after financing the MSRs by the mortgage loan servicing counterparty. Because MSR valuations typically increase as interest rates rise, offsetting mark-to-market declines on our residential credit portfolio, the MSR allocation is intended to serve as a natural book value hedge to our portfolio. In addition to its hedging characteristics, MSRs are also standalone, income generating assets. The recurring servicing fees, ancillary income, recapture income and float earnings associated with MSRs contribute to earnings while diversifying our interest rate exposure.
Current report
RTL Loans. We settled $27 million of business purpose loans during the second quarter that we committed to purchase in the first quarter, funded with warehouse facilities and targeting mid-to-high teen levered returns. These loans were purchased with a weighted average asset yield of 8.46%. We did not purchase any additional RTL loans during the rest of the year.
Current report
Asset Sales
Current report
Agency CMOs. During the second quarter, we sold Agency CMO securities for $73 million. In addition, we also sold previously purchased Agency RMBS Pass-through securities for $53 million and reallocated the capital to our current portfolio strategy. We received a total of $138 million in net proceeds from this sale and a total of $98 million after paying the financing on these positions. These sales resulted in a net realized loss of $2 million during the quarter, not including any net realized interest income. Proceeds from the sales were largely re-invested in Agency RMBS that increased our liquidity allocation.
Current report
Non-Agency and CMBS IO securities. In the third quarter, we also sold $104 million of Non-Agency RMBS subordinate securities, $88 million of Non-Agency RMBS senior securities and $164 million of Agency CMBS IO positions. Net liquidity raised after payment of principal on a secured financing facility that held these securities as collateral was $44 million. These sales generated a realized loss of $8.4 million during the third quarter. In the fourth quarter, we sold $33 million of Non-Agency RMBS subordinate securities. These sales generated a realized loss of $5 million during the fourth quarter.
Current report
Non-Agency retained securities. During the third quarter, we sold $237 million of retained bonds from previously issued RPL securitizations and $25 million from previously issued Non-QM and investor securitization for total proceeds of $232 million. Consequently, the retained positions sold will be added to securitized debt as a result of consolidation going forward. Net liquidity raised after payment of principal on a secured financing facility that held these retained bonds as collateral was $72 million.
Current report
Non-QM investment loans sales. As a normal discipline of our business operation, we routinely evaluate the potential economic and portfolio benefits of exercising our redemption rights with respect to our sponsored securitizations. These rights provide us with the option to organically raise liquidity by refinancing and/or selling the underlying loans. Through this strategy, during the fourth quarter we redeemed $70 million in securities from the CIM 2022-I1 securitization and sold the underlying loans with principal balance of $166 million. After satisfying certain recourse financing obligations, the transaction released approximately $28 million in equity.
Current report
Securitization Activity
Current report
On January 31, 2025, we sponsored CIM 2025-I1, a $288 million securitization of residential mortgage investor loans. The loans had a weighted average coupon of 7.9%, weighted average FICO scores of 748, and LTV ratio of 64%. Securities issued by CIM 2025-I1, with an aggregate balance of approximately $276 million, were sold in a private placement to institutional investors. These senior securities represented approximately 95.8% of the capital structure. We also retained an option to call the securitized mortgage loans on the earlier of (i) February 25, 2028, or (ii) when the unpaid principal balance is less than or equal to 30% of the unpaid principal balance of the securitized mortgage loans as of the cut-off date. The weighted average cost of debt on securities sold was 5.8%. The securitization is rated by Fitch and Morningstar DBRS. PAS is the asset manager for the securitization.
Current report
During the first quarter, we redeemed securities in seven outstanding securitizations and sponsored two new securitizations as further detailed below. The net result of these transactions enabled us to organically generate in excess of $187 million in capital for new investments, while moderately lowering our cost of financing by 17 basis points from a weighted average cost of 6.21% from the seven terminated securitizations to a 6.04% weighted average cost on the two new securitizations. Below we describe these transactions in more detail.
Current report
On March 25, 2025, we sponsored two securitizations of residential mortgage loans with an aggregate principal balance of $646 million. The mortgage loans for both securitizations were sourced from the redemption of prior Chimera-sponsored securitizations, including CIM 2021-NR1, CIM 2021-NR2, CIM 2021-NR3, CIM 2021-NR4, CIM 2022-NR1, CIM 2023-NR1, and CIM 2023-NR2.
Current report
CIM 2025-NR1 was a $254 million securitization of residential mortgage loans. The loans had a weighted average coupon of 5.67%, weighted average FICO scores of 597, and LTV ratio of 61.61%. Securities issued by CIM 2025-NR1, with an aggregate balance of approximately $184 million, were sold in a private placement to institutional investors. These senior securities represented approximately 72.50% of the capital structure. We retained subordinate interests in securities with an aggregate balance of approximately $70 million. We also retained an option to call the securitized mortgage loans, at the direction of the majority class B1 certificate holder, beginning on March 25, 2026. The weighted average cost of debt on securities sold was 6.59%. PAS is the asset manager for the securitizations.
Current report
Secured Financing Activity
Current report
During the first quarter of 2025, we exited a maturing $104 million non-MTM secured facility and separately entered into a new non-MTM secured facility with a principal amount of $167 million that will mature in 18 months in July 2026. The interest rate on the new facility was 412.5 basis points lower than the maturing facility.
Current report
In addition, we extended a maturing $407 million non-MTM secured facility by an additional 24 months to February 2027. The old facility had a spread of 375 basis points over SOFR with a maximum rate of 8.75%. The new facility has two separate terms: (i) an approximately $283 million financing facility with a fixed rate of 8.15%, and (ii) an approximately $136 million floating-rate facility at a rate of SOFR +425 basis points.
Current report
As of December 31, 2025, we had no outstanding warehouse financing exposure (recourse liabilities) backed by residential mortgage loans, other than a $67 million facility related to business purpose loans for the Investment Portfolio segment.
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Previous report
Item 7. Management's Discussion and Analysis of Financial Condition and Results of Operations
Previous report
All per share amounts, common shares outstanding and restricted shares for all periods presented reflect our 1-for-3 reverse stock split, which was effective after the close of trading on May 21, 2024.
Previous report
We are a publicly traded REIT that is primarily engaged in the business of investing in a diversified portfolio of mortgage assets for ourselves and for unrelated third parties through our third-party investment management and advisory services. The assets we may invest in and manage for others include residential mortgage loans, Non-Agency RMBS, Agency RMBS, business purpose loans (“BPLs”) (including residential transition loans (“RTLs”)) and investor loans, mortgage servicing rights (“MSRs”) and other real estate-related assets such as Agency CMBS, junior liens and home equity lines of credit, or HELOCs, equity appreciation rights, and reverse mortgages. The MBS and other real estate-related securities we purchase may include investment-grade, non-investment grade, and non-rated securities. Our investment management and advisory services are provided on a discretionary basis through investment funds that we manage and on a non-discretionary basis with respect to assets acquired and owned by third-party institutions, including insurance companies, credit funds, and other institutional investors.
Previous report
Our principal business objective is to provide attractive risk-adjusted returns through the generation of distributable income from our investment portfolio whose asset performance is linked to mortgage credit fundamentals and fees generated from providing investment management and advisory services to third parties. We plan to execute our business strategy through a combination of organic and external growth, depending on opportunities and market conditions. In addition to our strategy of building a durable portfolio of residential mortgage assets, we may invest in operational platforms, including entities that originate or service mortgage loans, and other businesses, partnerships or investments that could enhance our business activities.
Previous report
Interest Rates
Previous report
The consumer price index declined in the first part of 2024 and then held steady before rising in November and December, increasing 2.9% during 2024. The personal consumption expenditures price index increased 2.6% in December 2024, as compared with December 2023, recording a bigger increase than the 2.1% increase from October 2023 to October 2024.
Previous report
Meanwhile, real GDP in the U.S. grew at an annualized rate of 2.3% in the fourth quarter of 2024. Labor market conditions remained tight throughout the year, with the unemployment rate fluctuating between 3.7% and 4.2%.
Previous report
The Federal Reserve kept the federal funds rate in a target range of 5.25% and 5.50% through the first three quarters of 2024. The Federal Reserve then lowered the target federal funds rate by one hundred basis points between September and year-end. Long-term interest rates did not react to the federal funds rate cut as expected. In each of the previous seven cutting cycles since the 1980s, the 10-year Treasury rate decreased after a Fed rate cut. In 2024, the 10-year Treasury yield had decreased to 3.62% from a high of 4.70% in April only to spike back up to 4.63% by year-end after the Fed rate cuts. During the fourth quarter of 2024, the term premium for 10-year Treasuries increased by 75 basis points, which means the 10-year Treasury rate increased an additional 75 basis points over the rate change based on changing Fed expectations. We believe this increase in the term premium reflects the market’s uncertainty about future rates.
Previous report
Credit Spreads
Previous report
Residential credit performance was strong in 2024, driven by robust fundamentals given low defaults, rising home prices and record levels of homeowners’ equity. In addition, Non-Agency RMBS gross issuance ended at approximately $137 billion, almost doubling from 2023 issuance levels of $71 billion. Investor demand was very strong, and credit spreads tightened in 2024, especially at the bottom of capital structure, with the credit curve flattening significantly.
Previous report
While credit spreads in the residential market tightened significantly in 2024, they continue to remain attractive relative to the investment grade and high yield corporate bond markets. We believe market conditions align well with our residential credit strategy.
Previous report
As discussed earlier, interest rates experienced volatility during the year and that was reflected in mortgage rates. According to Freddie Mac, the average 30-year fixed mortgage rate started the year at 6.62% and ended the year at 6.85%, representing an increase of twenty-three basis points. However, mortgage rates were volatile throughout 2024 and peaked at 7.22% in May and by September had retreated down to 6.08%, prompting a modest uptick in refinancing activity. The mortgage basis, which is the spread between MBS and Treasury benchmarks, remained mostly range-bound between 120 and 160 basis points and ended the year at 135.
Previous report
During 2024, the number of previously owned-homes that were sold declined for the third consecutive year and to the lowest level since 1995 reflecting what we believe was the continuation of the lock-in effect and homeowners are reluctant to trade in the low mortgage rate for a higher rate if they sell their home. New home construction was up slightly from 2023, but new homes for sale that are under construction peaked in March and were slightly down from that peak in December. The number of completed new homes for sale hit its highest level in December since 2009. Demand, however, on a national basis for newly constructed homes remained strong during the year as the time from completing construction to sale remained under 3 months as compared to a historical average of nearly 5 months.
Previous report
Against this market backdrop, we managed our portfolio by increasing liquidity and diversifying sources of income. Consistent with this strategy, we raised $74 million from an equity raise in December 2023 and $140 million from two issuances of unsecured notes and deployed the net proceeds.
Previous report
We invested approximately $102 million in subordinated tranches of new issue third-party mortgage securitizations backed by RPLs and small balance commercial properties. These investments were purchased at attractive unlevered yields. Finally, we invested $1 billion in floating rate Agency CMOs. These floating rate investments were purchased at levered yields that exceeded the cost of capital from the Company’s unsecured debt issuance. We believe these investments will provide an attractive return while serving as a source of liquidity during intermittent periods as we seek to deploy capital in loans or other investments.
Previous report
In 2024, we committed to purchase $1.1 billion of residential mortgage loans, down from $1.4 billion in 2023 and $1.7 billion in 2022. Of such loans, approximately 44% were seasoned RPLs, 29% were Non-QMs, and the remainder were BPLs. Of the $1.1 billion of residential mortgage loans that we committed to acquire in 2024, $130 million were RTLs and $308 million were Non-QM DSCR loans that settled in the first quarter of 2025. Apart from RTLs, all loans purchased were financed or expected to be financed through non-recourse term securitization transactions. The loan characteristics of the seasoned RPLs and BPLs were consistent with the characteristics which currently exist in our portfolio.
Previous report
In December 2024, we completed the Palisades Acquisition, providing us with a new fee-based source of income, as discussed below.
Previous report
Given the challenging operating environment, ongoing liquidity needs, and opportunities to purchase new assets with higher yields, we rebalanced a portion of our investment portfolio. Overall, we sold $38 million Agency CMBS. These sales resulted in a recognized loss of $3.8 million. Additionally, to fund our investment activity and the Palisades Acquisition, we raised $20 million in liquidity through the sale of Agency CMOs during the fourth quarter. These sales resulted in a realized loss of $1.5 million.
Previous report
Considering the overall investment purchases, sales, and securitization activities, at December 31, 2024, our portfolio consisted of 88% residential mortgage loans, 8% Non-Agency RMBS, and 4% Agency MBS (including Agency CMOs) on a fair value basis. Our Agency portfolio increased by $417 million year-over-year through a combination of purchases and sales of Agency CMOs and sales of Agency CMBS activities.
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Additional Business Highlights
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Capital Raising Activity during 2024
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Acquisition of Palisades Group
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In December 2024, we consummated the Palisades Acquisition. Founded in 2012, Palisades manages and invests, on behalf of third parties, in residential real estate assets across a broad spectrum of credit products. Upon closing, Jack Macdowell, Jr., co-founder and Chief Investment Officer of Palisades, became our Chief Investment Officer. Under the terms of the agreement, we acquired Palisades for cash consideration of $30 million at closing, plus an additional potential earnout of up to $20 million over five years contingent upon achieving certain financial targets, with the option for us to pay 50% of the earnout payments in common shares, aligning interests with those of our shareholders.
Previous report
Secured Financing Activity during 2024
Previous report
The Federal Reserve shifted its monetary policy stance, transitioning from a period of rate hikes to implementing one hundred basis points in rate cuts during 2024 in response to evolving economic conditions. Managing our floating rate liabilities through this period of uncertainty remained among the top priorities of management. Management was focused throughout the year on strengthening our portfolio’s liability structure through proactive portfolio management (selling certain assets, purchasing non-agency subordinate securities and Agency CMO floaters) and securitization, which provides long-term, fixed rate, non-recourse financing.
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•Secured financing facilities backed by residential credit portfolio increased by $35 million.
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•Secured financing backed by Agency CMO facilities increased by $403 million.
Previous report
While our securitized debt (non-recourse liabilities) increased by $392 million during the third quarter as we closed on our CIM 2024-R1 securitization, our net securitized debt balance decreased by $617 million due to prepayments during the year. As of December 31, 2024, we had no outstanding warehouse financing exposure (recourse liabilities) backed by RPLs. Our repo funding costs decreased by 103 basis points during the year, consistent with decreases in the federal funds rates over the period.
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Securitization Activity during 2024
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Hedging transactions during 2024
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We engaged in a series of interest rate hedges to help mitigate the impact of higher interest rates on our future financing and protect against the impact of higher interest rates on the overall portfolio value. Our hedging strategies are dynamic. In 2024, management focused on limiting the impact of higher interest rates, while maintaining optionality for our portfolio to benefit from potential lower interest rates in the future. Over the year, we converted $1.5 billion of swaptions to a pay-fixed 1-year swap with a weighted average coupon of 3.56%. In addition, $1 billion of pay fixed 3.26% swaps matured .
Previous report
Compensation, general, administrative, and servicing expenses were lower marginally year-over-year when excluding expenses related to the Palisades Acquisition. Our transaction expenses were significantly lower during the year due to reduced securitization activity in 2024. However, these expenses increased in the fourth quarter by $2.4 million primarily from expenses related to the Palisades Acquisition. The increase in Compensation and benefits costs for the year ended December 31, 2024, as compared to the year ended December 31, 2023, was primarily driven by a $10 million, related-party, non-cash imputed compensation charge on the Palisade Acquisition.
Previous report
Reverse Stock Split
Previous report
On May 10, 2024, our Board of Directors approved a 1-for-3 reverse stock split of our common stock. The reverse stock split was effective after the close of trading on May 21, 2024, and shares of our common stock began trading on a reverse split-adjusted basis on the New York Stock Exchange beginning at the opening of trading on May 22, 2024. We implemented the reverse stock split with the objective of reducing our number of shares of common stock outstanding to more closely align with the number of common shares outstanding for companies of a similar market capitalization. As a result of the reverse stock split, every three shares of our common stock was converted into one share of common stock, reducing the number of issued and outstanding shares of our common stock from approximately 241 million to approximately 80 million and reducing the number of authorized shares from 500 million to approximately 167 million.
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We continue to approach portfolio management in a disciplined manner and are expecting to operate in an uncertain environment defined in part by higher interest rates and increased rate volatility. In 2025, we expect to continue to diversify our portfolio, increase liquidity and grow our fee-based income revenue streams.
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Net Income (Loss) Summary
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Results of Operations for the Years Ended December 31, 2024 and 2023.
Previous report
During the year ended December 31, 2024, we had net interest income of $265 million, unrealized gains on financial instruments at fair value of $11 million, net gains on derivatives of $5 million, investment and asset management fees of $3 million, and other investment gains of $10 million, offset in part by operating expenses of $102 million, preferred stock dividend of $86 million, and realized losses on sales of investments of $5 million.
Previous report
Interest income decreased by $12 million, or 1.5%, to $761 million for the year ended December 31, 2024, as compared to $773 million for the year ended December 31, 2023. This decrease in our interest income during the year ended December 31, 2024 was primarily driven by a decrease in our average interest earning assets as compared to the year ended December 31, 2023. We reduced our Loans held for investments by $877 million and Agency CMBS positions by $127 million offset by an increase in our Agency RMBS balance by $613 million during the year ended December 31, 2024, as compared to the year ended December 31, 2023. However, during the year ended December 31, 2024, the yields on our average interest earning assets increased by 10 basis points to 5.8%, as compared to 5.7% for the year ended December 31, 2023, which partially offset the effects of lower interest earning asset balances.
Previous report
Due to these changes in our portfolio, our interest income on Loans held for investment and Agency CMBS decreased by $28 million and $5 million, respectively, during the year ended December 31, 2024, as compared to the year ended December 31, 2023. This decrease was offset in part by an increase in interest income of $23 million on our Agency RMBS portfolio driven by our Agency CMO purchases during the year ended December 31, 2024, as compared to the year ended December 31, 2023.
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Our Strategy in 2024
Current wording
Execution of Our Strategy in 2025
Previous wording
In July, we sponsored CIM 2024-R1, a $468 million securitization of seasoned RPLs. Securities issued by CIM 2024-R1, with an aggregate balance of approximately $352 million, were sold in a private placement to institutional investors. These senior securities represented approximately 75.15% of the capital structure. We retained subordinate interests in securities with an aggregate balance of approximately $116 million and certain interest-only securities. We also retained an option to call the securitized mortgage loans when their unpaid principal balance is less than or equal to 30% of the unpaid principal balance of the securitized mortgage loans as of the cut-off date. The advance rate was 75% with a 5.7% weighted average cost of debt.
Current wording
CIM 2025-R1 was a $392 million securitization of residential mortgage loans. The loans had a weighted average coupon of 5.74%, weighted average FICO scores of 636, and LTV ratio of 50.80%. Securities issued by CIM 2025-R1, with an aggregate balance of approximately $333 million, were sold in a private placement to institutional investors. These senior securities represented approximately 85% of the capital structure. We retained subordinate interests in securities with an aggregate balance of approximately $59 million and certain IOs. We also retained an option to call the securitized mortgage loans on the earlier of (i) March 25, 2027 or (ii) when the aggregate principal amount of the offered notes is less than, or equal to, 10% of the aggregate principal amount of the offered notes as of March 25, 2025. The weighted average cost of debt on securities sold was 5.74%. PAS is the asset manager for the securitization.
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On a year-over-year basis, our secured financing agreements (recourse liabilities) increased by a net $392 million:
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During the fourth quarter of 2025, our secured financing costs overall declined by 43 basis points for the quarter and 158 basis points for the year, and our secured financing agreements (recourse liabilities) increased by a net $352 million for the quarter, reflecting the deployment of leverage to support our Agency RMBS activities. While the purchase of Agency RMBS securities increased toward the end of the year, our Non-Agency RMBS financing saw a decrease of approximately $74 million during the quarter and $78 million during the year due to asset sales and paydowns.
Previous wording
Finally, at the end of the year, our total recourse financing exposure was $2.96 billion. We continue to seek opportunities to finance our retained notes from securitizations with long-term, limited, or, when conditions are appropriate, non-MTM finance facilities. We currently have 48% of our recourse financing with these types of facilities. To further manage our interest rate risk, we intend to use financial derivatives such as futures, interest rate swaps and swaptions to hedge against securitization executions and net interest margin compression.
Current wording
At the end of the year, our total recourse financing exposure on our investment portfolio was $5.2 billion. We continue to seek opportunities to finance our retained notes from securitizations with long-term, limited, or, when conditions are appropriate, non-MTM financing facilities. We currently have $1.3 billion, or 25%, of our recourse financing with these types of facilities.
Previous wording
As of December 31, 2024, we maintained open interest rate swap positions in: (i) a $500 million 3.43% pay-fixed interest rate swap maturing in April 2025, (ii) a $500 million 3.49% pay-fixed interest rate swap maturing in April 2025, and (iii) a $500 million 3.76% pay-fixed interest rate swap maturing in June 2025. The company also has a long position in $500 million 1-year swaption on a 1-year pay-fixed interest rate swap with a fixed rate of 3.45% that we exercised in January 2025.
Current wording
As of December 31, 2025, we maintained open interest rate hedge positions attributable to the residential credit portfolio that included: (i) a $500 million 3.45% pay-fixed interest rate swap maturing in January 2026, (ii) a $1.0 billion interest rate cap with a strike rate of 3.95% maturing in February 2027, (iii) $50 million 4.05% par rate equivalent pay-fixed two-year Eris swap futures maturing in March 2027, (iv) a $300 million two-year 3.40% pay fixed rate swaption that expires in January 2027, and (v) a $300 million two-year 3.17% pay fixed rate swaption that expires in February 2027.
Previous wording
Considering the velocity and magnitude of interest rate movements, we maintained a hedging program to manage the interest rate risk for the time differential between loan purchase commitment and the closing of loans into securitization. In addition, we used a combination of various U.S. Treasury futures contracts to hedge our exposure to future financing costs. Our hedging techniques attempt to mitigate the interest rate risk but do not capture the impact of credit spread risk. As part of our ongoing securitization execution hedging strategy, we entered into $200 million of short 2-year treasury futures contracts during the fourth quarter to buy protection that hedges the coupon rate of the senior notes of the securitization execution that settled during the first quarter of 2025.
Current wording
Loan Acquisitions. Considering the velocity and magnitude of interest rate movements, we maintain a hedging program to manage the interest rate risk for the time differential between loan purchase commitment and the closing of loans into securitization. We use a combination of various U.S. Treasury futures contracts to hedge our exposure to future financing costs. Our hedging techniques attempt to mitigate the interest rate risk but do not capture the impact of credit spread risk. We did not have any loan commitments or related futures hedges as of the end of the quarter.
Previous wording
In May 2024, we issued $65 million of 9.00% unsecured senior notes due May 15, 2029. Net of underwriting fees, we received a total of $62 million in proceeds. These notes may be redeemed, in whole or in part, at any time at our option on or after May 15, 2026. In August 2024, we issued $75 million of 9.25% unsecured senior notes due August 15, 2029. Net of underwriting fees, we received a total of $72 million in proceeds. These notes may be redeemed, in whole or in part, at any time at our option on or after August 15, 2026. While we continue to favor securitized debt as a favorable source of financing for our assets, the ability to issue unsecured debt helps us to further diversify our capital structure and provides long-term financing for our mortgage credit portfolio. We invested the proceeds from the capital raises in Agency CMOs which we expect will provide accretive returns to our shareholders. We raised a total of approximately $140 million from our unsecured bond offerings in 2024.
Current wording
In September, we issued $120 million of 8.875% unsecured senior notes due August 15, 2030. Net of underwriting fees and offering expenses, we received approximately $116 million in proceeds. These notes may be redeemed, in whole or in part, at any time, from time to time, at our option on or after August 15, 2027. While we continue to favor securitized debt as a source of financing for our assets, the ability to issue unsecured debt helps us to further diversify our capital structure and provides long-term financing to support our investment activities. This was our third overall unsecured bond offering over the past two years, resulting in a combined total issuances of approximately $260 million.
Previous wording
Grants of Restricted Stock Units (“RSUs”)
Current wording
On September 19, 2025, the Compensation Committee of the Board of Directors (the “Compensation Committee”) approved grants of restricted stock units (“RSUs”), effective October 1, 2025, representing an aggregate of up to 540,000 shares of our common stock, of which 533,391 were granted, under the Chimera Investment Corporation 2025 Inducement Award Plan (the “Award Plan”) to up to 300 individuals offered employment with Chimera in connection with our acquisition of HomeXpress.
Previous wording
Given the interest rate volatility during the year, portfolio valuations remained volatile and ended the year with valuations ranging from flat to slightly down. The increase in rates, particularly at the longer dated maturity toward the end of the year, caused a 11.77% decline in book value during the fourth quarter of 2024. Our book value per common share was $19.72, as of December 31, 2024, as compared to $20.25 as of December 31, 2023. We declared $1.42 common stock dividends per share in 2024. Our economic return on book value, which includes the overall change in book value for the period plus dividends, was 4.40% for the full year of 2024. The total rate of return on our common stock, including dividend reinvestment, was 3.5% for 2024.
Current wording
This dynamic, along with elevated transaction during the fourth quarter, contributed to a decrease in book value per share of 2.7%, to $19.70 as of December 31, 2025, as compared to $20.24 in the prior quarter. For the year ended December 31, 2025, our book value per common share remained relatively unchanged at $19.70, as compared to $19.72 for the year ended December 31, 2024. We declared $1.48 common stock dividends per share in 2025. Our economic return on book value, which includes the overall change in book value for the period plus dividends, was (0.9)% for the fourth quarter and 7.4% for the full year of 2025.
Previous wording
While we intend to continue to look for opportunities to acquire and securitize mortgage loans, we expect to grow our Agency RMBS portfolio. In addition to supporting our regulatory compliance, we believe that a larger Agency RMBS portfolio will provide portfolio diversity, more stable dividends, and a source of liquidity for opportunistic asset and business acquisitions and protection in periods of volatility. We also intend to look at opportunities to acquire MSRs, which we believe will help hedge our loan portfolio, as well as provide a diverse source of income for our dividends.
Current wording
With respect to our portfolio, while we intend to continue to look for opportunities to securitize mortgage loans (whether we manufacture or acquire the loans), we expect to grow our Agency RMBS and MSR portfolios. In addition to supporting our regulatory compliance, we believe that a larger Agency RMBS portfolio will provide portfolio diversity, more stable dividends, a source of liquidity for opportunistic asset and business acquisitions, as well as allowing us to grow our fee-based operations, and protection in periods of volatility. We also intend to look at opportunities to acquire additional MSRs, which we believe will help hedge our loan portfolio, as well as provide a diverse source of income for our dividends.
Previous wording
With the Palisades Acquisition, we have embarked on our strategy of enhancing returns to our shareholders through diversification of revenue from fee-based income. As we move into 2025 and beyond, we expect to expand and grow our non-discretionary investment management and advisory services and continue to look for opportunities to grow through a combination of organic and external growth, depending on opportunities and market conditions.
Current wording
With the HomeXpress and Palisades acquisitions, we have embarked on our strategy of enhancing returns to our shareholders through diversification of revenue from fee-based income. As we move into 2026 and beyond, we will look for opportunities to grow our residential operating platform both organically and through acquisitions. We believe that HomeXpress is well positioned to grow originations in 2026 and we will continue to assess the strategy of selling versus retaining the loan production volume of HomeXpress, considering how it affects our short-term results and long-term earnings potential. HomeXpress views its loan origination volumes, its loan sale premiums and its cost efficiency to be its key performance indicators and uses these to measure management’s effectiveness in realizing its objectives. With respect to our non-discretionary advisory business, we anticipate heightened competition may pressure client flow volumes which may lead to margin compression across existing and potential client relationships. We will however, continue to navigate through the market challenges and look to maintain and/or grow our non-discretionary investment management and advisory services through a combination of organic and external growth, depending on opportunities and market conditions.
Previous wording
We expect that funds for these portfolio diversification and growth initiatives will come from our existing portfolio as we return to our re-lever strategy. We expect to call, and if market conditions are appropriate, re-securitize our NR securitizations, as well as some of our R securitizations in 2025.
Current wording
Funds for these portfolio diversification and growth initiatives will come from both our existing portfolio, as we return to our re-lever strategy, and the capital markets. We expect to call, and if market conditions are appropriate, either sell loans or re-securitize our NR securitizations, as well as some of our R securitizations, in 2026. Our ability to call and either sell or resecuritize the loans, as well as access the capital markets will depend on a number of factors, including the breakeven economic re-investment rate, relative value opportunity and liquidity needs, among others.
Previous wording
The table below presents our net income (loss) on a GAAP basis for the years ended December 31, 2024, 2023 and 2022.
Current wording
The table below presents our net income on a GAAP basis for the years ended December 31, 2025, 2024, and 2023.
Previous wording
(1) Includes interest income of consolidated VIEs of $640,499, $593,384, and $551,253 for the years ended December 31, 2024, 2023, and 2022, respectively.
Current wording
(1) Includes interest income of consolidated VIEs of $557,046, $640,499 and $593,384 for the years ended December 31, 2025, 2024, and 2023 respectively.
Previous wording
(2) Includes interest expense of consolidated VIEs of $293,509, $282,542, and $197,823 for the years ended December 31, 2024, 2023, and 2022, respectively.
Current wording
(2) Includes interest expense of consolidated VIEs of $283,722, $293,509, and $282,542 for the years ended December 31, 2025, 2024, and 2023, respectively.
Previous wording
(3) Includes a related-party, non-cash imputed compensation expense from the Palisades Acquisition of $10 million for the year ended December 31, 2024.
Current wording
(4) Includes a related-party, non-cash imputed compensation expense from the Palisades Acquisition of $1,364, $10,296, and $0 for the years ended December 31, 2025, 2024 and 2023, respectively.
Previous wording
Our primary source of income is interest income earned on our assets, net of interest expense paid on our financing liabilities.
Current wording
The primary source of income for our Investment Portfolio segment is interest income earned on our assets, net of interest expense paid on our financing liabilities, and investment and asset management fees earned through our investment management and advisory business.
Previous wording
For the year ended December 31, 2024, our net income available to common shareholders was $90 million, or $1.12 per average basic common share, compared to a net income of $52 million, or $0.68 per average basic common share for the year ended December 31, 2023. The increase in net income available to common shareholders for the year ended December 31, 2024, as compared to the year ended December 31, 2023 was primarily driven by an increase in net gains on derivatives of $35 million, a decrease in net losses on sales of investments of $26 million, and a decrease in transactions expenses of $8 million.
Current wording
For the year ended December 31, 2025, our net income available to common shareholders was $144 million, or $1.76 per average basic common share, compared to a net income of $90 million, or $1.12 per average basic common share for year ended December 31, 2024. The increase in net income available to common shareholders for the year ended December 31, 2025, as compared to the year ended December 31, 2024, was primarily driven by an increase in net unrealized gains on financial instruments at fair value of $71 million, an increase in investment management and advisory fees of $33 million related to a full year of customized solutions offerings, and an increase in net unrealized gains on derivatives of $7 million. This was offset by an increase in net realized losses on sales of investments of $18 million, an increase in realized losses on derivatives of $12 million, an increases to compensation and benefits of $15 million due to the inclusion of staffing costs from the Palisades Acquisition in December 2024, an increase in transaction expenses of $10 million related to a combination of the HomeXpress Acquisition and higher securitization activity, and an increase in amortization of intangibles and depreciation of $7 million related to the newly acquired intangible assets as part of the business acquisitions.
Previous wording
Our Economic net interest income is a non-GAAP financial measure that equals GAAP net interest income adjusted for net periodic interest cost of interest rate swaps and excludes interest earned on cash. For the purpose of computing economic net interest income and ratios relating to cost of funds measures throughout this section, interest expense includes net payments on our interest rate swaps, which is presented as a part of Net gains (losses) on derivatives in our Consolidated Statements of Operations. Interest rate swaps are used to manage the increase in interest paid on secured financing agreements in a rising rate environment. Presenting the net contractual interest payments on interest rate swaps with the interest paid on interest-bearing liabilities reflects our total contractual interest payments. We believe this presentation is useful to investors because it depicts the economic value of our investment strategy by showing all components of interest expense and net interest income of our investment portfolio. However, Economic net interest income should not be viewed in isolation and is not a substitute for net interest income computed in accordance with GAAP. Where indicated, interest expense, adjusting for any interest earned on cash, is referred to as Economic interest expense. Where indicated, net interest income reflecting net periodic interest cost of interest rate swaps and any interest earned on cash, is referred to as Economic net interest income.
Current wording
Economic net interest income of our Investment Portfolio is a non-GAAP financial measure that equals GAAP net interest income adjusted for net periodic interest on derivatives, interest income from Residential Origination segment and interest income from investment in MSR financing receivables, and excludes interest earned on cash and interest expense from our Residential Origination segment. For the purpose of computing economic net interest income and ratios relating to cost of funds measures throughout this section, interest expense includes net payments on our derivatives, which is presented as a part of Net gains (losses) on derivatives in our Consolidated Statements of Operations. Interest rate swaps, Interest rate cap and Swap futures are used to manage the increase in interest paid on secured financing agreements in a rising rate environment. Presenting the net contractual interest payments on interest rate derivatives with the interest paid on interest-bearing liabilities reflects our total contractual interest payments. We believe this presentation is useful to investors because it depicts the economic value of our investment strategy by showing all components of interest expense and net interest income of our investment portfolio. However, Economic net interest income should not be viewed in isolation and is not a substitute for net interest income computed in accordance with GAAP. Where indicated, interest expense, adjusting for any interest earned on cash, is referred to as Economic interest expense. Where indicated, net interest income reflecting net periodic interest on derivatives and any interest earned on cash, is referred to as Economic net interest income.
Previous wording
(1) Primarily interest income on cash and cash equivalents.
Current wording
(1) Primarily interest income on cash and cash equivalents from our Portfolio and Residential Origination segments and interest income from investment in MSR financing receivables.
Previous wording
The following table shows our average earning assets held, interest earned on assets, yield on average interest earning assets, average debt balance, economic interest expense, economic average cost of funds, economic net interest income and net interest rate spread for the periods presented.
Current wording
The following tables show our average earning assets held, interest earned on assets, yield on average interest earning assets, average debt balance, economic interest expense, economic average cost of funds, economic net interest income and net interest rate spread for the periods presented.
Previous wording
Economic Net Interest Income and the Average Earning Assets
Current wording
Economic Net Interest Income and the Average Earning Assets -Investment Portfolio Segment
Previous wording
Our Economic net interest income (which is a non-GAAP measure, see “Economic net interest income” discussion earlier for details) increased by $10 million to $281 million for the year ended December 31, 2024 from $271 million for the year ended December 31, 2023. The net interest margin, which equals the Economic net interest income as a percentage of the net average balance of our interest-earning assets less our interest-bearing liabilities, increased by 20 basis points for the year ended December 31, 2024, as compared to the year ended December 31, 2023. Our Average net interest-earning assets decreased by $127 million to $2.0 billion for the year ended December 31, 2024, compared to $2.1 billion for the same period of 2023. Our net interest rate spread, which equals the yield on our average interest-earning assets less the economic average cost of funds, increased by 20 basis points for the year ended December 31, 2024, as compared to the year ended December 31, 2023. The increase in our net interest spread was primarily driven by a decrease in our interest expense due to Fed rate cuts and lower average interest-bearing liabilities balances driven by our de-levering efforts.
Current wording
Our Economic net interest income (which is a non-GAAP measure, see “Economic net interest income” discussion earlier for details) decreased by $6 million to $275 million for the year ended December 31, 2025, from $281 million for the year ended December 31, 2024. Our net interest rate spread, which equals the yield on our average interest-earning assets less the economic average cost of funds, remained relatively unchanged at 1.5% for the years ended December 31, 2025 and 2024, respectively.
Previous wording
Economic Interest Expense and the Cost of Funds
Current wording
Economic Interest Expense and the Cost of Funds - Investment Portfolio Segment
Previous wording
The borrowing rate at which we are able to finance our assets using secured financing agreements is typically correlated to Secured Overnight Financing Rate (“SOFR”) and the term of the financing. The borrowing rate on the majority of our securitized debt is fixed and correlated to the term of the financing. The table below shows our average borrowed funds, Economic interest expense, average cost of funds (inclusive of periodic interest costs on swaps), average one-month SOFR, average three-month SOFR and average one-month SOFR relative to average three-month SOFR.
Current wording
The borrowing rate at which we are able to finance our assets using secured financing agreements is typically correlated to SOFR and the term of the financing. The borrowing rate on the majority of our securitized debt is fixed and correlated to the term of the financing. The table below shows our average borrowed funds, Economic interest expense, average cost of funds (inclusive of periodic interest on swaps and Swap futures), average one-month SOFR, average three-month SOFR and average one-month SOFR relative to average three-month SOFR.
Previous wording
Average interest-bearing liabilities decreased by $257 million for the year ended December 31, 2024, as compared to the year ended December 31, 2023. Economic interest expense decreased by $20 million for the year ended December 31, 2024, as compared to the year ended December 31, 2023, primarily due to Fed rate cuts.
Current wording
Average interest-bearing liabilities increased by $1.1 billion for the year ended December 31, 2025, as compared to the year ended December 31, 2024. Economic interest expense increased by $52 million for the year ended December 31, 2025, as compared to the year ended December 31, 2024, due to an increase in borrowings under our secured financing agreements to fund our Agency RMBS purchases.
Previous wording
For the year ended December 31, 2024, we recorded provision for credit losses of $10 million, as compared to provision of credit losses of $11 million for the year ended December 31, 2023.
Current wording
For the year ended December 31, 2025, we recorded an increase in provision for credit losses of $16 million, as compared to an increase in provision of credit losses of $10 million for the year ended December 31, 2024. The changes in provision for credit losses for the year ended December 31, 2025, as compared to the year ended December 31, 2024, are primarily due to a deterioration in cashflows on a combination of Non-Agency senior and subordinated bonds.
Previous wording
We use derivatives to economically hedge the effects of changes in interest rates on our portfolio, specifically our secured financing agreements. Unrealized gains and losses include the change in market value, period over period, on our derivatives portfolio. Changes in market value are generally a result of changes in interest rates. We may or may not ultimately realize these unrealized derivative gains and losses depending on trade activity, changes in interest rates and the values of the underlying securities. The net gains and losses on our derivatives include both unrealized and realized gains and losses. Realized gains and losses include the net cash paid and received on our interest rate swaps during the period as well as sales, terminations and settlements of our swaps, swaptions and U.S. Treasury futures.
Current wording
We use derivatives to economically hedge the effects of changes in interest rates on our portfolio, specifically our secured financing agreements. Unrealized gains and losses include the change in market value, period over period, on our derivatives portfolio. Changes in market value are generally a result of changes in interest rates. We may or may not ultimately realize these unrealized derivative gains and losses depending on trade activity, changes in interest rates and the values of the underlying securities. The net gains and losses on our derivatives include both unrealized and realized gains and losses. Realized gains and losses include the net cash paid and received on our derivatives portfolio during the period as well as sales, terminations and settlements related to our derivatives portfolio.
Previous wording
The table below shows a summary of our net gains (losses) on derivative instruments, for the years ended December 31, 2024, 2023, and 2022, respectively.
Current wording
The tables below show a summary of our net gains (losses) on derivative instruments for the years ended December 31, 2025, 2024 and 2023.
Previous wording
During the years ended December 31, 2024 and 2023, we recognized total net gains on derivatives of $5 million and total net losses on derivatives of $30 million, respectively. Changes in market value are generally a result of changes in interest rates. We may or may not ultimately realize these unrealized derivative gains and losses depending on trade activity, changes in interest rates and the values of the underlying securities.
Current wording
During the years ended December 31, 2025 and 2024, we recognized total net losses on derivatives of $3 million and total net gains on derivatives of $5 million, respectively. Changes in market value are generally a result of changes in interest rates. We may or may not ultimately realize these unrealized derivative gains and losses depending on trade activity, changes in interest rates and the values of the underlying securities.
Previous wording
The weighted average pay rate on our interest rate swaps at December 31, 2024 was 3.56% and the weighted average receive rate was 4.49%. At December 31, 2024, the weighted average maturity on our interest rate swaps was less than one year. The weighted average pay rate on our interest rate swap at December 31, 2023 was 3.26% and the weighted average receive rate was 5.40%. At December 31, 2023, the weighted average maturity on our interest rate swaps was less than one year.
Current wording
The weighted average pay rate on our interest rate swaps at December 31, 2024 was 3.56% and the weighted average receive rate was 4.49%. At December 31, 2024, the weighted average maturity on our interest rate swaps was less than one year.
Previous wording
We hadno swap terminations during the year ended December 31, 2024. We had a realized loss of $17 million related to the maturity ofone swap during the year ended December 31, 2024. We paid $45 million to terminate interest rate swaps with a notional value of $2.5 billion during the year ended December 31, 2023. The terminated swaps had original maturities ranging from 2025 to 2028.
Current wording
We had net realized losses of $26 million related to swap terminations during the year ended December 31, 2025. We had a realized loss of $17 million related to the maturity ofone swap during the year ended December 31, 2024.
Previous wording
During the year ended December 31, 2024, we entered into 1,391 short 5-year and 1,684 short 5-year U.S. Treasury futures contracts with notional amounts of $139 million and $168 million, respectively, which we subsequently covered for a net realized loss of $4.9 million. Additionally, we covered and reopened our existing open 2-year U.S Treasury futures contact position for a realized gain of $641 thousand. We are short 1,000 2-year U.S. Treasury futures contracts as of December 31, 2024. During the year ended December 31, 2023, we entered into 6,000 short 5-year and 1,875 short 2-year U.S. Treasury futures contracts with a notional amounts of $600 million and $375 million, respectively, which we subsequently covered and had no outstanding U.S. Treasury futures contracts at December 31, 2023. We had a net realized loss of $6 million on covering these short U.S. Treasury futures contracts. We also entered into 400 call options on 2-year and 5-year U.S. Treasury futures and subsequently covered them during the year ended December 31, 2023 for a realized loss of $187 thousand.
Current wording
For our Investment Portfolio segment, during the year ended December 31, 2025, we covered our open short position of 1,000 two-year U.S. Treasury Futures contracts for a net realized gain of $82 thousand. During the year ended December 31, 2024, we entered into 1,391 short 5-year and 1,684 short 5-year U.S. Treasury futures contract with a notional of $139 million and $168 million, respectively, which we subsequently covered for a net realized loss of $5 million. Additionally, we covered and reopened our existing open 2-year U.S Treasury futures contract position for a realized gain of $641 thousand. We are short 1,000 2-year U.S. Treasury futures contract at December 31, 2024.
Previous wording
During the second quarter of 2024, we issued $65 million aggregate principal amount of 9.00% unsecured senior notes due 2029 that pay quarterly interest. After deducting the underwriting discount and other debt issuance costs, we received approximately $62 million of proceeds.
Current wording
During the second quarter of 2024, we issued $65 million aggregate principal amount of 9.00% unsecured senior notes due 2029 that pay quarterly interest. After deducting the underwriting discount and other debt issuance costs, we received approximately $251 million of proceeds.
Previous wording
At December 31, 2024, the outstanding principal amount of these notes was $140 million and the accrued interest payable on this debt was $2 million. At December 31, 2024, the unamortized deferred debt issuance cost was $5 million. The net interest expense was $7 million for the year ended December 31, 2024.
Current wording
At December 31, 2025, the outstanding principal amount of these notes was $260 million and the accrued interest payable on this debt was $3 million. At December 31, 2025, the unamortized deferred debt issuance cost was $8 million. The net interest expense was $17 million and $7 million for the years ended December 31, 2025 and 2024, respectively.
Previous wording
During the fourth quarter of 2024, we started earning investment management and advisory fees through certain investment management agreements entered into with our investment partnerships and privately offered pooled investment vehicles, insurance companies, and other institutional clients. We recognized investment management and advisory fees of $3 million for the year ended December 31, 2024.
Current wording
During the fourth quarter of 2024, we started earning investment management and advisory fees through certain investment management agreements entered into with our investment partnerships and privately offered pooled investment vehicles, insurance companies, and other institutional clients. We recognized investment management and advisory fees of $35 million and $3 million for the years ended December 31, 2025 and 2024, respectively.
Previous wording
We do not forecast sales of investments as we generally expect to invest for long-term gains. However, from time to time, we may sell assets to create liquidity necessary to pursue new opportunities, to achieve targeted leverage ratios, as well as for gains when prices indicate a sale is most beneficial to us, or is the most prudent course of action to maintain a targeted risk adjusted yield for our investors. As mentioned earlier, during the year ended December 31, 2024, we rebalanced a portion of our investment portfolio and sold Agency CMBS and Agency CMO assets. These sales resulted in a net realized losses of $5 million during the year ended December 31, 2024. During the year ended December 31, 2023, we sold some of our Agency MBS investments as part of our portfolio optimization efforts and realized a loss of $31 million.
Current wording
We do not forecast sales of investments as we generally expect to invest for long-term gains. However, from time to time, we may sell assets to create liquidity necessary to pursue new opportunities, to achieve targeted leverage ratios, as well as for gains when prices indicate a sale is most beneficial to us, or is the most prudent course of action to maintain a targeted risk-adjusted yield for our investors.
Previous wording
We did not acquire any securitized debt collateralized by Non-Agency RMBS during the year ended December 31, 2024, and December 31, 2023.
Current wording
We did not acquire any securitized debt collateralized by Non-Agency RMBS during the years ended December 31, 2025 and 2024.
Previous wording
We did not acquire any securitized debt collateralized by Loans held for investment during the year ended December 31, 2024. During the year ended December 31, 2023, we acquired securitized debt collateralized by Loans held for investment with an amortized cost balance of $551 million for $545 million. These transactions resulted in net gain on extinguishment of debt of $6 million.
Current wording
We acquired securitized debt collateralized by Loans held for investment with an amortized cost balance of $384 million for $382 million during the year ended December 31, 2025. We did not acquire any securitized debt collateralized by loans held for investment during the year ended December 31, 2024.
Previous wording
The Compensation and benefits costs were approximately $41 million and $31 million for the year ended December 31, 2024 and December 31, 2023, respectively. The increase in Compensation and benefits costs for the year ended December 31, 2024 compared to the year ended December 31, 2023, was primarily driven by $10.3 million related-party, non-cash imputed compensation expense related to the Palisade Acquisition.
Current wording
Compensation and benefits costs were approximately $57 million and $41 million for the year ended December 31, 2025 and December 31, 2024. The increase in Compensation and benefits costs for the year ended December 31, 2025 compared to the year ended December 31, 2024, was driven by higher overall compensation expense related to the increase in employee headcount and expenses related to the acquisitions of Palisades and HomeXpress.
Showing the first 40 of 93 pairs. Open the source sections for the rest.
Rearranged current paragraphs (6)
Current report — wording carried from elsewhere
Our Average net interest-earning assets decreased by $254 million to $1.8 billion for the year ended December 31, 2025, compared to $2.0 billion for the same period of 2024. Our net interest margin, which equals the yield on our average interest-earning assets less the economic average cost of funds, decreased by 20 basis points for the year ended December 31, 2025, as compared to the year ended December 31, 2024.
Current report — wording carried from elsewhere
The weighted average pay rate on our interest rate swaps at December 31, 2025 was 3.44% and the weighted average receive rate was 3.87%. At December 31, 2025, the weighted average maturity on our interest rate swaps was less than 6 years. During the year ended December 31, 2025, we had net realized losses of $26 million related to the interest rate swaps.
Current report — wording carried from elsewhere
(1) Potentially dilutive shares related to restricted stock units and performance stock units excluded from the computation of weighted average GAAP diluted shares because their effect would have been anti-dilutive given the GAAP net loss available to common shareholders. There were no dilutive shares related to RSU/PSUs given the Company reported GAAP net income available to common shareholders for all periods.
Current report — wording carried from elsewhere
2024, we had $7.4 billion and $4.1 billion, respectively, of securities or cash pledged against our secured financing agreements obligations.
Current report — wording carried from elsewhere
On June 14, 2023, the Board of Directors recommended and shareholders approved, the Chimera Investment Corporation 2023 Equity Incentive Plan (the “Plan”). It authorized the issuance of up to 6,666,667 shares of our common stock for the grant of awards under the Plan (adjusted on a retroactive basis to reflect the Company's 1-for-3-reverse stock split effected on
Current report — wording carried from elsewhere
During the third quarter of 2025, we issued $120 million aggregate principal amount (including the additional amount issued pursuant to the exercise of the over-allotment option) of 8.875% Senior Notes due 2030 that pay quarterly interest. After deducting the underwriting discount and other debt issuance costs we received approximately $116 million of proceeds. While we continue to favor securitized debt as a source of financing for our assets, the ability to issue unsecured debt helps us to further diversify our capital structure and provides long-term financing to support our investment activities
Rearranged previous paragraphs (4)
Previous report — wording carried elsewhere
In May 2024, we issued $65 million of 9.00% unsecured senior notes due May 15, 2029. Net of underwriting fees, we received a total of $62 million in proceeds. These notes may be redeemed, in whole or in part, at any time at our option on or after May 15, 2026. In August 2024, we issued $75 million of 9.25% unsecured senior notes due August 15, 2029. Net of underwriting fees, we received a total of $72 million in proceeds. These notes may be redeemed, in whole or in part, at any time at our option on or after August 15, 2026.
Previous report — wording carried elsewhere
(1) Potentially dilutive shares related to restricted stock units and performance stock units excluded from the computation of weighted average GAAP diluted shares
Previous report — wording carried elsewhere
because their effect would have been anti-dilutive given the GAAP net loss available to common shareholders for the year ended December 31, 2024.
Previous report — wording carried elsewhere
2023, the weighted average borrowing rates for our secured financing agreements collateralized by Agency CMBS was 5.6%, and Non-Agency MBS and Loans held for investment was 7.6%.