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PIMCO Mortgage Income Trust tabled plans to launch an initial public offering this week following a steep stock market decline Monday.
“The company elected to postpone the offering as a result of unfavorable equity market conditions, specifically in the market for initial public offerings,” according to a press release issued by Pacific Investment Management Co. PIMCO is the company’s external manager and advisor.
The company is positioning itself as a real estate investment trust that acquires, manages and finances agency and nonagency residential mortgage-backed securities, mortgage servicing rights, residential mortgages and other real estate-related assets.
Casey Newell, an executive vice president in PIMCO’s private strategies group, has been named the company’s CEO, according to a preliminary prospectus filed last month.
PIMCO executive vice presidents Jason Mandinach and John Lane have respectively been named president and chief financial officer of PIMCO Mortgage Income Trust.
Other key executives include PIMCO managing directors Daniel Hyman and Jason Steiner, who have been named co-chief investment officers.
Hyman is co-head of the agency mortgage portfolio management team at PIMCO, and Steiner is a senior residential mortgage credit portfolio manager focused on mortgage loans and servicing.
“We believe agency RMBS valuations have become more attractive relative to much of the post-financial crisis environment and there remains a large void for private capital to fill in residential credit markets,” the S-11 filing for the company states. “We believe that private and permanent capital can take advantage of the reduced government footprint in the mortgage market to generate attractive risk-adjusted returns.”
PIMCO Mortgage Investment Trust also sees opportunity in servicing given banks’ reduced role and the slowdown in the origination market that has put pressure on lender’s profit margins in ways that create demand for MSRs sales and financing.
“Given the complexity and illiquidity of MSRs, we believe a PIMCO-managed, permanent capital vehicle with significant mortgage origination and acquisition capabilities is well suited to take advantage of this emerging opportunity,” the company said in the Securities and Exchange Commission filing.