TPG RE Finance Trust, Inc. (NYSE:TRTX) Q4 2023 Earnings Conference Call February 21, 2024 9:00 AM ET

Company Participants

Doug Bouquard - Chief Executive Officer

Bob Foley - Chief Financial Officer

Conference Call Participants

Arren Cyganovich - Citi

Stephen Laws - Raymond James

Steve DeLaney - Citizens JMP

Sarah Barcomb - BTIG

Rick Shane - JPMorgan

Don Fandetti - Wells Fargo

Operator

Greetings and welcome to TPG Real Estate Finance Trust Earnings Call for the Fourth Quarter and Full Year of 2023. At this time, all participants are in a listen-only mode. A brief question-and-answer session will follow the formal presentation. [Operator Instructions] As a reminder, today’s call is being recorded.

It is now my pleasure to turn the call over to the company. Thank you. You may begin.

Unidentified Company Representative

Good morning and welcome to TPG RE Finance Trust earning call for the fourth quarter and full year of 2023. We are joined today by Doug Bouquard, Chief Executive Officer; and Bob Foley, Chief Financial Officer. Doug and Bob will share some comments about the quarter and then we will open the floor for questions.

Last evening, the company filed its Form 10-K and issued a press release and earnings supplemental with a presentation of operating results, all of which are available on the company’s website in the Investor Relations section. As a reminder, today’s call may include forward-looking statements which are uncertain and outside of the company’s control. Actual results may differ materially.

For a discussion of risks that could affect results, please see the Risk Factor section of the company’s Form 10-K. The company does not undertake any duty to update these statements, and today’s call participants will refer to certain non-GAAP measures, and for reconciliations you should refer the press release and the Form 10-K.

At this time, I’ll turn the call over to Doug Bouquard, Chief Executive Officer.

Doug Bouquard

Good morning and thank you for joining the call. Over the past quarter, the market has rallied broadly, driven by a mix of robust economic growth, a tight labor market and the expectation that the worst is behind us in terms of both inflation and restrictive Fed policy. Not only is the S&P 500 up about 5% since the start of the year, it’s worth noting that since October 2022, the S&P has rallied a remarkable 40%.

In credit markets, corporate credit spreads continue to tighten in sympathy with the equity markets. However, real estate credit spreads continue to underperform on a relative basis, driven by the same themes that have been affecting the real estate market for the last several quarters. Broad pressure on values, secular challenges to office, elevated borrowing costs and reduced liquidity. Many traditional providers of real estate debt capital, particularly regional banks, remain defensively positioned.