Putnam Investments plans to launch a new REIT to primarily buy RMBS guaranteed by a U.S. government agency or a GSE.
In a filing today with the Securities and Exchange Commission (SEC), Putnam indicated that its new REIT, Putnam Mortgage Opportunities Co., will be raising money in an IPO to fund the investments.
"We believe that the residential mortgage market currently presents opportunities for highly attractive risk-adjusted returns as it recovers from the recent financial crisis and undergoes structural reform," Putnam said in the filing. "We believe that successful mortgage market investors will be able to navigate the challenges posed by a changing rate environment, ongoing changes in government housing policy, and continued changes in servicing practices and bank regulatory capital rules."
The REIT, which might be externally managed and advised by Putnam subsidiary Putnam Advisory Co., might also purchase non-agency RMBS, CMBS and ABS.
Putnam said the REIT might also invest in other companies or pooled investment vehicles focused on investing in agency RMBS and/or any class of our potential target assets.
For a full copy of Putnam's SEC filing, please click this link.