Chimera Investment Corporation's Series C cumulative preferred stock is now paying an annual dividend rate of 8.90%, up from the 7.75% rate set when the shares were issued in 2018, according to the security's floating-rate terms disclosed in its original SEC prospectus. The reset, tied to the stock's fixed-to-floating structure of three-month LIBOR plus 4.743 percentage points, has pushed the current yield on the preferred to 11.36% based on its most recent trading price of $19.58 as of October 30, 2026.
That yield figure reflects a security trading well under its $25 liquidation preference. At $19.58, the Series C shares sit 21.68% below par, a discount of $5.42 per share. The stock has also moved past its call date of September 30, 2025, meaning Chimera has had the option to redeem the preferred at par for more than a year but has not done so.
The combination matters because it places two distinct forces in tension for holders. On one hand, the dividend rate has climbed as the floating-rate formula adjusted upward with reference rates, lifting the income stream to $2.2244 per share annually based on the current rate. On the other, the market price has not followed suit, leaving the shares priced well below the $25 redemption value they would fetch if Chimera chose to call them. Because the stock is callable now, any redemption would occur at par, which would represent a gain of $5.42 per share, or roughly 27.7%, versus the recent trading price. Chimera has given no indication of its intentions regarding the Series C shares, and whether or when the company might redeem them remains the issuer's decision alone.
The security is a Maryland-incorporated REIT instrument originally sold in a 2018 offering of 10 million shares plus a 1.5 million overallotment option, according to the SEC 424B5 prospectus. Net proceeds of approximately $241.9 million were earmarked for acquiring residential mortgage loans, Agency mortgage-backed securities and other targeted assets, along with general corporate purposes including paying down liabilities. The preferred carries cumulative dividend protection, meaning any missed payments must be made up before common shareholders receive distributions, and pays quarterly on March 30, June 30, September 30 and December 30.
Chimera itself has been expanding its origination business. The company completed its acquisition of HomeXpress Mortgage Corp for approximately $272 million in October 2025, moving into direct origination of Non-QM, QM and investor business purpose residential mortgage loans, and on October 30, 2026, the company announced the launch of a securitization program built around HomeXpress-originated loans, according to a report carried by finance.yahoo.com. Separately, Kalkine Media reported on October 30, 2026, that Vanguard Capital Management disclosed a 4.98% ownership stake in Chimera Investment Corp.
The preferred's discount comes against a backdrop in which Chimera's common stock has struggled. The common shares (NYSE: CIM) closed at $8.55 on October 30, 2026, down 2.12% on the day, and sit well off their 52-week high of $14.18. The Lincolnian Online reported on September 23, 2026, that the common stock had touched a new 12-month low. Chimera's board declared a quarterly common dividend of $0.45 per share, equating to an annualized $1.80, according to a Kalkine Media report from September 18, 2026.
Among mortgage REIT preferreds broadly, Chimera's Series C discount of 21.7% compares with an average discount of 20.4% across a broader set of 132 preferred issues carrying a current yield, while its 11.36% yield runs slightly above the group average. Other Chimera preferred series carry yields ranging from roughly 11.27% to 11.86%, alongside a baby bond paying a 9.0% coupon, underscoring that elevated yields and below-par pricing are a pattern across the issuer's capital structure rather than isolated to the Series C shares.
Investors in mortgage REIT preferreds will likely continue watching Chimera's quarterly earnings, with its third-quarter 2026 results call scheduled following an announcement made October 22, 2026, for signs of how the HomeXpress integration and broader portfolio performance are affecting the company's capital allocation decisions, including any potential action on preferred shares that remain callable at par. Movements in short-term reference rates will also continue to drive the floating dividend rate on the Series C shares in future reset periods.