Net income dips, but mortgage portfolio hits record balance
Non-bank lender Atrium Mortgage Investment Corporation has announced financial results for the second quarter of 2024, revealing a record mortgage portfolio balance of $907.8 million despite a year-over-year decrease in net income.
For the quarter ended June 30, 2024, Atrium reported a net income of $11.5 million, representing a 20.1% decline from the same period in 2023. Basic and diluted earnings per share were $0.26, down from $0.33 and $0.32, respectively, in the previous year.
“Atrium continued to deliver strong returns for shareholders, with earnings per share of $0.26 for the second quarter and $0.53 year-to-date,” said Rob Goodall, CEO of Atrium. “Our focus remains on navigating through challenging real estate market conditions and the portfolio composition now has 96.8% of the portfolio in first mortgages and 89.5% with a loan to value less than 75%.”
Strong financial performance
Total assets for the quarter were reported at $885.6 million, up from $877.9 million at the end of 2023. Revenues for the second quarter reached $24.9 million, marking a 5.9% increase from the same period last year. However, the company’s net income was lower compared to $14.4 million in the second quarter of 2023, which could be due to an increased allowance for mortgage losses, which rose to $29.3 million as of June 30, 2024.
For the first half of 2024, Atrium generated $50.1 million in revenue, a 6.1% increase compared to the same period in 2023. Net income for the six months ended June 30, 2024, was $23.6 million, down 17.7% from the prior year.
Atrium’s mortgage portfolio remains heavily concentrated in residential properties, particularly in the Greater Toronto Area (GTA), which accounts for 78.4% of the portfolio. The weighted average loan-to-value ratio stands at 64.4%, with an average interest rate of 10.93%.
The lender strengthened its funding sources by amending its credit facility, increasing the maximum available amount to $340 million and adding Royal Bank to its lending syndicate.
Looking ahead, Atrium remains cautiously optimistic about the potential for lower inflation and interest rates to improve market conditions. However, the company plans to continue its defensive lending approach, prioritizing investments in its preferred sectors while closely monitoring credit risks.
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