Fitch keeps Thornburg on watch

Fitch Ratings said that given the uncertainty surrounding the pricing of Thornburg Mortgage, Inc.'s portfolio securities in the secondary mortgage market and its effects on the company's short-term financing, the following ratings for Thornburg remain on rating watch negative by Fitch Ratings: issuer default rating at CCC, senior unsecured notes CCC-/RR5, unsecured subordinate notes CC/RR6 and preferred stock CC/RR6.

While Fitch said that it acknowledges Thornburg's ability to improve its capitalization by raising $230 million of common and convertible preferred stock in January and also consummate a $992 million collateralized mortgage debt transaction in March, Fitch remains concerned that Thornburg's short-term funding profile continues to expose the company to margin calls.

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