PennyMac Mortgage Investment Trust (PMT) today reported $1.3m of net Q110 income. Of PMT’s $3.85m net investment income, non-agency subprime residential mortgage-backed securities (RMBS) accounted for $600,000. Non-agency Alt-A RMBS contributed $611,000 and non-agency prime jumbo RMBS contributed $130,000. Whole mortgage loans contributed nearly $2.47m to net investment income. The company acquired five residential mortgage whole loan pools worth $115m with unpaid principal balances of $208m at the time of purchase. These were primarily non-performing loans with 86% of the loans 90+ days delinquent or in foreclosure. The transactions bring the total net value of PMT’s residential mortgage whole loans and RMBS as of quarter-end to $200m. PMT closed another transaction in April to purchase a $71m whole loan pool of non-performing loans with unpaid principal balance of $141m. This transaction won’t affect earnings until the Q210 statement. With the closing of this acquisition, PMT will have used “a substantial amount” of its capital raised in the initial public offering. The company said it is working on its first securitization to raise additional capital for investment purposes. PMT is targeting a Q210 completion. “As we look forward, we continue to see attractive opportunities in the marketplace,” said CEO Stanford Kurland in a press statement. “We are starting to see a stabilization of real estate values, with the economy showing some signs of improvement. The securitization market is starting to make a comeback as well, with a recent announcement of the first newly originated jumbo securitization in approximately 2 years.” Kurland added: “We are encouraged by these events and feel that PMT is well positioned to capitalize on the variety of opportunities that will arise as the markets continue to improve.” Write to Diana Golobay. Disclosure: the author holds no relevant investments.