Thornburg Mortgage Files Amended Form 10-K/A to Reflect Restated Financial Statements

Thornburg Mortgage, Inc. (NYSE:TMA) filed its Amended Annual Report on Form 10-K/A with the U.S. Securities and Exchange Commission today. The Form 10-K/A contains restated consolidated financial statements for the year ended December 31, 2007. It also reflects a $248.8 million increase to the impairment charge of $427.8 million reported in the Form 8-K the company filed on Friday, March 7, 2008, bringing the company’s total impairment charge to $676.6 million for the year ended December 31, 2007. The company recognized this additional impairment charge in accordance with generally accepted accounting principles because it may not have the ability to hold certain of its securitized ARM loans to maturity. The restatement of the company’s financial statements is due to adverse developments in the mortgage finance and credit markets since August 2007 that have resulted in a significant deterioration of market prices of the company’s mortgage-backed securities. The credit quality of the company’s assets remains outstanding, with 0.44% 60-plus day delinquencies and REO at December 31, 2007 on its loan portfolio, which is well below the 4.23% industry average at September 30, 2007. And, 97% of its mortgage portfolio rated the equivalent of AAA or AA. The company believes that these unrealized losses are not reflective of credit deterioration within its mortgage holdings and that the restatement of its financial statements will not have a material impact on the company’s book value at December 31, 2007. In fact, the reduced carrying value of these assets will now improve the company’s yield going forward and will benefit GAAP income. Commenting on the company’s situation in the current market environment, Larry Goldstone, president and chief executive officer of Thornburg Mortgage said, "Similar to many companies impacted by the current crisis in the mortgage finance industry, our immediate challenge is meeting margin calls from our lenders that has been brought on by the dramatic decline in high quality mortgage-backed securities prices. While we aggressively pursue more permanent solutions to our liquidity issues, we are in discussions with our lenders to reach a mutually satisfactory agreement that will enable us to meet all of our outstanding margin calls within an acceptable timeframe for our lenders and also mitigate the sale of high-quality assets at a significant loss in this environment.” Goldstone concluded, "While these challenges are unprecedented, we are making every effort to manage through this situation so that we may resume our business as a leading super-prime lender in the jumbo mortgage sector.” Thornburg Mortgage is a leading single-family residential mortgage lender focused principally on prime and super-prime borrowers seeking jumbo and super-jumbo adjustable-rate mortgages. The company seeks to deliver value and steady growth for its shareholders by acquiring high-quality mortgage-backed securities, and growing its share of the mortgage loan origination business. Capitalizing on its innovative portfolio lending model, REIT tax structure and leading-edge technology, Thornburg Mortgage is a highly efficient provider of specialized mortgage loan products for borrowers nationwide with excellent credit. Certain matters discussed in this press release may constitute forward-looking statements within the meaning of the federal securities laws. These forward-looking statements are based on current expectations, estimates and projections, and are not guarantees of future performance, events or results. The words "believe," "anticipate," "intend," "aim," "expect," "will," "strive," "target," "project," "have confidence" and similar words identify forward-looking statements. Actual results and developments could differ materially from those expressed in or contemplated by the forward-looking statements due to a number of factors, including general economic conditions, our ability to raise additional capital, our ability to retain or sell additional assets, the impact of additional margin calls, the receipt of additional notices of default under lending agreements, our ability to continue as a going concern, market prices for mortgage securities, interest rates, the availability of ARM securities and loans for acquisition and other risk factors discussed in the company's SEC reports, including its most recent amended annual report on Form 10-K/A. The company does not undertake to update, revise or correct any of the forward-looking information.