Ellington Financial Grows Credit Portfolio 15% to $4.1B After $400M Notes Offering
Adjusted long credit portfolio grew 15% to $4.1b after seven Q4 securitizations and a revolving RTL deal, supported by a $400m notes offering. Q4 GAAP EPS was $0.14 and ADE reached $0.47 per share, exceeding the $0.39 dividend, with book value per share at $13.16 and a 4.6% annualized economic return.
1. Q4 Financial Results
Ellington Financial reported GAAP EPS of $0.14 and adjusted distributable earnings of $0.47 per share in Q4, surpassing its $0.39 per share dividend. Book value per share stood at $13.16, and the company achieved a 4.6% annualized economic return for the quarter.
2. Securitization and Portfolio Growth
The company completed seven securitizations in the quarter, including a first revolving residential transition loan transaction, and closed its inaugural agency-eligible securitization. These deals drove a 15% sequential increase in the adjusted long credit portfolio to $4.1 billion, reflecting growth in non-QM, agency-eligible, second-lien, bridge, ABS and CLO exposures.
3. Funding and Liability Management
Ellington Financial issued $400 million of unsecured notes, using proceeds to reduce short-term repo reliance and extend financing tenor. As a result, weighted average recourse borrowing costs fell to 5.67%, long-term non-mark-to-market financing rose to 30% of recourse debt, and unencumbered assets increased to $1.77 billion.
4. Credit Performance and Outlook
Credit performance remained strong with low realized losses and declining 90-day delinquencies across residential and commercial portfolios. Management cited short-term GAAP drags from fair value election on the notes and highlighted macro uncertainties around policy changes, but expects securitization reuse and capital efficiency to support future originations and returns.