OPX 8K 2-22-2006

UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, DC 20549
 
Form 8-K
 
CURRENT REPORT
 
Pursuant to Section 13 or 15(d) of the
Securities Exchange Act of 1934

Date of Report (Date of earliest event reported): February 22, 2006
 
Opteum Inc.
(Exact Name of Registrant as Specified in Charter)

Maryland
001-32171
72-1571637
(State or Other Jurisdiction of Incorporation)
(Commission File Number)
(IRS Employer Identification No.)

3305 Flamingo Drive, Vero Beach, Florida 32963
(Address of Principal Executive Offices) (Zip Code)

Registrant’s telephone number, including area code (772) 231-1400

N/A
(Former Name or Former Address, if Changed Since Last Report)


Check the appropriate box below if the Form 8-K filing is intended to simultaneously satisfy the filing obligation of the registrant under any of the following provisions:

¨
Written communications pursuant to Rule 425 under the Securities Act (17 CFR 230.425)

¨
Soliciting material pursuant to Rule 14a-12 under the Exchange Act (17 CFR 240.14a-12)

¨
Pre-commencement communications pursuant to Rule 14d-2(b) under the Exchange Act (17 CFR 240.14d-2(b))

¨
Pre-commencement communications pursuant to Rule 13e-4(c) under the Exchange Act (17 CFR 240.13e-4(c))
 
REGULATION FD DISCLOSURE

On February 22, 2006, Opteum Inc. (the “Company”) prepared updated portfolio information as of February 17, 2006. A copy of this information is attached hereto as Exhibit 99.1.

The Company believes that certain statements in the information attached may constitute “forward-looking statements” within the meaning of the Private Securities Litigation Reform Act of 1995. These statements are made on the basis of management’s views and assumptions regarding future events and business performance as of the time the statements are made. Actual results may differ materially from those expressed or implied. Information concerning factors that could cause actual results to differ materially from those in forward-looking statements is contained from time to time in the Company’s filings with the U.S. Securities and Exchange Commission.

This information furnished under this “Item 7.01 Regulation FD Disclosure,” including the exhibit related hereto, shall not be deemed “filed” for purposes of Section 18 of the Securities Exchange Act of 1934, nor shall it be deemed incorporated by reference in any disclosure document of the Company, except as shall be expressly set forth by specific reference in such document.

ITEM 9.01.
EXHIBITS

(c)
Exhibit

The following exhibit is filed pursuant to Item 601 of Regulation S-K:

99.1 - Updated Portfolio Information of Opteum Inc.




SIGNATURES

Pursuant to the requirements of the Securities Exchange Act of 1934, the Registrant has duly caused this report to be signed on its behalf by the undersigned hereunto duly authorized.


Date: February 22, 2006
OPTEUM INC.
   
   
 
By:
/s/ Jeffrey J. Zimmer
  
   
Jeffrey J. Zimmer
   
Chairman, Chief Executive Officer and President


EXHIBIT INDEX
 
Exhibit No.
 
  
 
 
 
99.1
-
Updated Portfolio Information of Opteum Inc.


Exhibit 99.1
UNAUDITED as of 2/22/2006

Opteum Inc. - Asset Information
This Table Reflects All Transactions. Prices Used Are Internally Generated.

Valuation
Asset Category
  
Market Value
 
As a Percentage of
Mortgage Assets
 
As a Percentage of
Mortgage Assets, Cash
and P&I Receivable
Adjustable Rate Mortgage Backed Securities (1)
$
2,073,842,989
 
58.16%
  
55.48%
Hybrid Adjustable Rate Mortgage Backed Securities
  
728,843,996
 
20.44%
  
19.50%
Fixed Rate Mortgage Backed Securities
  
549,428,498
  
15.41%
  
14.70%
Fixed Rate Agency Debt
  
96,727,786
 
2.71%
  
2.59%
Fixed Rate CMO
  
70,067,967
 
1.96%
  
1.87%
Balloon Maturity Mortgage Backed Securities
  
47,223,309
 
1.32%
  
1.26%
Total: Mortgage Assets (2)
$
3,566,134,545
 
100.00%
    
             
Total Cash and Net Short-Term Receivables
$
107,071,755
 
    
2.86%
Cash out on Margin (Encumbered Cash)
  
-
 
    
0.00%
Long-Term Receivables From Opteum Financial Services LLC
  
65,000,000
 
    
1.74%
Total: All Assets
$
3,738,206,300
 
    
100.00%

Note: The Value of Securities in the Box is $9,336,979

(1)
Adjustable Rate MBS are those that reset coupons within one year’s time.
(2)
This includes forward settling purchases. There are no forward settling sales as of 2/17/2006
*
The information contained herein EXCLUDES all Opteum Financial Services LLC’s assets.

Characteristics
Asset Category
 
Weighted Average
Coupon
 
Weighted Average
Lifetime Cap
 
Weighted Average
Periodic Cap
Per Year (3)
 
Weighted Average
Coupon Reset
(in Months)
 
Longest
Maturity
 
Weighted Average
Maturity
(in Months)
Adjustable Rate Mortgage Backed Securities(3)
 
4.61%
  
10.42%
  
1.79%
  
4.87
  
1-Apr-44
  
332
Hybrid Adjustable Rate Mortgage Backed Securities
 
4.32%
  
9.84%
  
1.72%
  
19.31
  
1-Nov-35
  
337
Fixed Rate Mortgage Backed Securities
 
6.91%
  
n/a
  
n/a
  
n/a
  
1-Feb-36
  
275
Fixed Rate Agency Debt
 
4.00%
  
n/a
  
n/a
  
n/a
  
25-Feb-10
  
48
Fixed Rate CMO
 
5.58%
  
n/a
  
n/a
  
n/a
  
25-Jul-34
  
330
Balloon Maturity Mortgage Backed Securities
 
4.06%
  
n/a
  
n/a
  
n/a
  
1-Feb-11
  
47
Total: Mortgage Assets
 
4.90%
  
10.27%
  
1.77%
  
8.62
  
1-Apr-44
  
313

(3) 31.3% ($649.8 million) of The Adjustable Rate Mortgage Portfolio Have No Periodic Caps. These assets are excluded from the weighted average periodic cap per year calculation

Agency
  
Market Value
  
As a Percentage of Mortgage Assets
  
Pool Status
  
Market Value
  
As a Percentage of Mortgage Assets
Fannie Mae
$
2,275,520,234
  
63.81%
  
Whole Pool
$
2,176,625,554
  
61.04%
Freddie Mac
  
697,406,331
  
19.56%
  
Non Whole Pool
  
1,389,508,991
  
38.96%
Ginnie Mae
  
593,207,980
  
16.63%
  
Total Portfolio
$
3,566,134,545
  
100.00%
Total Portfolio
$
3,566,134,545
  
100.00%
            






Prepayment Speeds
Asset Category
  
Weighted Average
One Month
Prepayment Speeds
(CPR)
  
Weighted Average
Three Month
Prepayment Speeds
(CPR)
Adjustable Rate Mortgage Backed Securities
  
26.24%
  
32.17%
Hybrid Adjustable Rate Mortgage Backed Securities
  
16.82%
  
23.54%
Fixed Rate Mortgage Backed Securities
  
20.96%
  
26.00%
Fixed Rate Agency Debt
  
n/a
  
n/a
Fixed Rate CMO
  
17.36%
  
24.37%
Balloon Maturity Mortgage Backed Securities
  
16.71%
  
15.58%
Total: Mortgage Assets
  
22.79%
  
28.85%


On February 7, 2006 Prepayment Speeds were released for paydowns occurring in January 2006 (November - January for three month speeds). The numbers above reflect that data.


Portfolio Price and Duration
Weighted Average Purchase Price
$
102.52
Weighted Average Current Price
$
100.83
Modeled Effective Duration
  
1.233


 
Internally
Generated Market
Value
 
% of Asset
Class
 
% of Total Mortgage
Assets
Adjustable Rate Mortgages
          
 
One Month LIBOR
$
41,207,709
 
1.99%
  
1.16%
Moving Treasury Average
  
59,368,641
 
2.86%
  
1.66%
Cost Of Funds Index
  
399,406,681
 
19.26%
  
11.20%
Six Month LIBOR
  
210,395,397
 
10.15%
  
5.90%
Six Month CD Rate
  
2,877,030
 
0.14%
  
0.08%
One Year LIBOR
  
409,223,222
 
19.73%
  
11.48%
Conventional One Year CMT
  
581,577,004
 
28.04%
  
16.31%
FHA and VA One Year CMT
  
363,094,211
 
17.51%
  
10.18%
Other
  
6,693,094
 
0.32%
  
0.19%
Total ARMs
$
2,073,842,989
 
100.00%
  
58.16%
 
          
 
Hybrid ARMs
          
 
Generic Fannie or Freddie Hybrid ARMs
          
 
13 - 18 Months to First Reset
$
318,101,010
 
43.64%
  
8.92%
19 - 24 Months to First Reset
  
131,473,261
 
18.04%
  
3.69%
25 - 36 Months to First Reset
  
51,030,472
 
7.00%
  
1.43%
37 - 48 Months to First Reset
  
0
  
0.00%
  
0.00%
Total
$
500,604,743
 
68.68%
  
14.04%
 
          
 
Agency Alt-A Hybrid ARMs
          
 
13 - 18 Months to First Reset
$
17,021,633
 
2.34%
  
0.48%
19 - 24 Months to First Reset
  
3,821,659
 
0.52%
  
0.10%
25 - 36 Months to First Reset
  
14,932,781
 
2.05%
  
0.42%
37 - 47 Months to First Reset
  
4,144,958
 
0.57%
  
0.12%
Total
$
39,921,031
 
5.48%
  
1.12%
 
          
 
GNMA Hybrid ARMs
          
 
13 - 24 Months to First Reset
$
167,074,229
 
22.92%
  
4.68%
25 - 36 Months to First Reset
  
21,243,993
 
2.92%
  
0.60%
Total
$
188,318,222
 
25.84%
  
5.28%
 
          
 
Total Hybrid ARMs
$
728,843,996
  
100.00%
  
20.44%
             
Balloons
 
          
< = 4.0 Years to Balloon Date
$
36,179,124
  
76.61%
  
1.01%
4.01 - 5.0 Years to Balloon Date
  
11,044,185
  
23.39%
  
0.31%
5.01 - 5.5 Years to Balloon Date
  
0
  
0.00%
  
0.00%
Total Balloons
$
47,223,309
  
100.00%
  
1.32%
 


 
 
Internally
Generated Market
Value
  
% of Asset
Class
  
% of Total Mortgage
Assets
 Fixed Rate Agency Debt            
 4.5yr Stated Final Maturity $ 
96,727,786 
  
100.00% 
 
2.71% 
 Total Fixed Rate Agency Debt $ 
96,727,786 
 
100.00% 
  
 2.71%
             
 Fixed Rate CMOs            
 Fixed Rate CMOs $ 
70,067,967 
  
100.00% 
 
1.96% 
 Total Fixed Rate CMOs $ 
70,067,967 
  
100.00% 
  
1.96% 
             
Fixed Rate Assets
 
          
10yr Other (Seasoned, Low Avg Bal, Low FICO, etc.)
 $
2,031,512
  
0.37%
  
0.06%
15yr $85,000 Maximum Loan Size
 
70,884,818
  
12.90%
  
1.98%
15yr $110,000 Maximum Loan Size
 
4,689,136
  
0.85%
  
0.13%
15yr 100% Investor Property
 
610,435
  
0.11%
  
0.02%
15yr 100% FNMA Expanded Approval Level 3
 
946,891
  
0.17%
  
0.03%
15yr 100% Alt-A
 
38,751,040
  
7.05%
  
1.09%
15yr Geography Specific (NY, FL, VT, TX)
 
1,818,235
  
0.33%
  
0.05%
15yr Other (Seasoned, Low Avg Bal, Low FICO, etc.)
 
25,605,844
  
4.66%
  
0.72%
20yr Other (Seasoned, Low Avg Bal, Low FICO, etc.)
 
1,127,853
  
0.21%
  
0.03%
20yr 100% Alt-A
 
771,324
  
0.14%
  
0.02%
30yr $85,000 Maximum Loan Size
 
161,731,593
  
29.44%
  
4.54%
30yr $110,000 Maximum Loan Size
 
38,492,163
  
7.01%
  
1.08%
30yr 100% Investor Property
 
6,276,128
  
1.15%
  
0.18%
30yr 100% FNMA Expanded Approval Level 3
 
49,264,461
  
8.97%
  
1.38%
30yr 100% Alt-A
 
35,789,691
  
6.51%
  
1.00%
30yr Geography Specific (NY, FL, VT, TX)
 
4,528,275
  
0.82%
  
0.13%
30yr 100% GNMA Builder Buydown Program
 
5,431,751
  
0.99%
  
0.15%
30yr Other (Seasoned, Low Avg Bal, Low FICO, etc.)
 
100,677,348
  
18.32%
  
2.82%
Total Fixed Rate Collateral
$
549,428,498
  
100.00%
  
15.41%
             
Total (All Mortgage Assets)
$
3,566,134,545
      
100.00%
Cash or Cash Receivables
  
107,071,755
  
 
  
 
Long-Term Receivables From OFS
  
65,000,000
        
Total Assets and Cash
$
3,738,206,300
  
 
  
 
             
Total Forward Settling Purchases
$
139,882,457
        


UNAUDITED Funding Information as of 2/22/2006


Repurchase Counterparties
 
Dollar Amount of
Borrowings
  
Weighted Average
Maturity in Days
  
Longest
Maturity
Deutsche Bank (1)
$
950,737,006
  
101
  
11-Oct-06
Nomura
 
671,699,000
  
84
  
18-Sep-06
WAMU
 
383,501,000
  
22
  
13-Apr-06
Cantor Fitzgerald
 
346,402,000
  
43
  
25-Apr-06
Bear Stearns
 
236,335,000
  
97
  
7-Jul-06
UBS Securities
 
171,096,000
  
83
  
19-Oct-06
Goldman Sachs
 
141,917,000
  
48
  
1-May-06
Merrill Lynch
 
128,119,000
  
48
  
19-Apr-06
JP Morgan Secs
 
93,783,000
  
143
  
18-Jul-06
Morgan Stanley
 
72,606,455
  
67
  
27-Apr-06
Lehman Bros
 
62,643,000
  
39
  
28-Mar-06
Daiwa Secs
 
35,772,000
  
85
  
7-Jul-06
Countrywide Secs
  
22,930,000
  
38
  
27-Mar-06
RBS Greenwich Capital
  
1,503,000
  
45
  
3-Apr-06
Total
$
3,319,043,461
  
76
  
19-Oct-06
             
Total Forward Settling Purchases Without Committed Repo Terms
  
139,882,457
        
             
Estimated Haircut (at 3%)
  
4,196,474
        
Estimated Forward Borrowings
  
135,685,983
        
Estimated Total Borrowings
$
3,454,729,445
        
             
(1) Includes $507 Million floating rate repo obligations