PennyMac Mortgage Investment Trust, a vulture fund launched by former Countrywide Financial president Stan Kurland, earned $7.7 million in the third quarter, and declared a cash dividend of 42 cents a share.
The company said its profit was driven by "realized and unrealized gains" of $7.6 million during the quarter. "Of these gains, $3.5 million was realized through payoffs and sales, the result of collection on the loan balances at levels higher than their beginning of quarter fair values," it said.
During 3Q PennyMac, a publicly traded REIT, said it invested $125 million in distressed mortgage assets, including $73 million of nonperforming residential whole loans and $52 million in mortgage-backed securities.
After the close of the quarter it bought an additional $222 million of nonperforming whole loans. The company also disclosed that it had lined up a new $100 million line of credit.
PennyMac went public in the fall of 2009. The company is using cash flows from existing investments and debt from security repurchase agreements (backed by MBS) to fund its NPL purchases.
