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New York Mortgage Trust Issues 9.875% Senior Notes in Initial Public Offering (IPO)
ByAinvest
Sunday, Jul 13, 2025 12:01 pm ET1min read
New York Mortgage Trust has launched a 9.875% senior note IPO. The company focuses on investing in a diversified portfolio of agency and non-agency residential mortgage-backed securities. The senior notes have a fixed interest rate of 9.875%, a maturity date of January 2026, and are rated A- by Fitch.
New York Mortgage Trust (NYMT) has launched an IPO for its 9.875% Senior Notes, due October 1, 2030. The company, which focuses on investing in a diversified portfolio of agency and non-agency residential mortgage-backed securities, has issued 3.4 million notes with a par value of $25 each. The gross proceeds from this new security amount to $85 million [1].The senior notes carry a fixed interest rate of 9.875%, with quarterly distributions of $0.6172 per note. The notes are callable on and after October 1, 2027, and are unsecured obligations ranking senior in payment to any future indebtedness that is expressly subordinated to them [1].
NYMT's capital structure has seen a slight increase with the new issue, with total debt rising to $8.41 billion. The senior unsecured notes outstanding, which include the new issue, now total $324 million. The company's debt structure places these notes senior to preferred equity but junior to secured indebtedness and certain collateralized debt obligations [1].
The company's management team has highlighted the purpose of the Trust as delivering long-term stable distributions to its shareholders. NYMT has a history of consistent dividend payments, but a recent dividend cut in 2023 has led to a higher dividend yield. The current dividend yield is 11.9%, with a forward estimated dividend of $0.80 per share [1].
The new issue's 9.875% nominal yield is notable, as it is more than 600 basis points above the 5-year Treasury yields at the time of the IPO. The security is priced below Single-B in credit quality, indicating a substantial investment risk [1].
NYMT's performance over the past ten years has been underwhelming, with the company underperforming both the broader market and the mortgage REIT sector. However, analysts remain bullish on the company's future prospects [1].
References:
[1] https://seekingalpha.com/article/4800765-nymth-9-percent-senior-note-ipo-new-york-mortgage-trust
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