Annaly(US:NLY)2026-02-12 21:17Portfolio Composition - Annaly Capital Management's portfolio composition as of December 31, 2025, included 89% Agency assets, 7% Residential Credit, and 4% Mortgage Servicing Rights (MSR) [25] - Annaly's investment strategy includes a focus on Agency mortgage-backed securities, non-Agency residential whole loans, and mortgage servicing rights, adapting to market conditions [32] Financial Metrics - The company had $81.9 billion in repurchase agreements outstanding as of December 31, 2025, reflecting its reliance on this financing method for Agency mortgage-backed securities and residential credit securities [36] - The economic leverage ratio was 5.6:1 as of December 31, 2025, maintaining a conservative posture below the target of 10:1 [42] - The GAAP capital ratio was reported at 11.9% as of December 31, 2025, indicating a stable capital structure [42] Securitization Activities - Annaly issued 29 OBX securitizations backed by $15.2 billion of residential whole loans during the year ended December 31, 2025, under its private-label securitization program [39] Operational Efficiency - The company has established strategic relationships with key mortgage loan originators and technology firms to enhance operational efficiency and access to quality originations [21] - Annaly's operating platform supports diverse asset management through investments in technology and infrastructure, enhancing operational efficiency [45] - The company has invested in technology to enhance operational efficiencies, including centralized collateral management and automation-based processes [46] Risk Management - The company maintains a risk appetite statement that guides its investment management activities, focusing on income generation and capital preservation [26] - The company’s risk management framework is designed to identify, measure, monitor, and control key risks, which is critical to its business strategy [48] Workforce and Employee Well-being - As of December 31, 2025, the company had 212 employees, reflecting its commitment to maintaining a skilled workforce [54] - The company has a diverse workforce, with 57% of its Operating Committee and 60% of its overall population identifying as either female and/or racially/ethnically diverse [59] - The company emphasizes employee well-being through various benefits, including health coverage, 401(k) plans, and mental health initiatives [61] Corporate Governance - The company has a comprehensive approach to corporate governance, ensuring compliance with ethical standards and applicable laws [73] - The Board is composed of a majority of independent directors, with all directors elected annually and an independent Chair of the Board appointed [74] - The company has adopted a Code of Business Conduct and Ethics applicable to directors, officers, and employees [74] - Executive officers are subject to two clawback policies covering financial restatements and misconduct [74] - Stockholders holding 25% of common stock can call a special meeting, enhancing shareholder rights [74] - The company has an Insider Trading Policy prohibiting directors, officers, and employees from trading based on material nonpublic information [74] - The company has established stock ownership guidelines and holding restrictions for executive officers and directors [74] Transparency and Reporting - The company provides financial statements and supplementary data in its Form 10-K, available on its website [78] - The company has a commitment to transparency, making various reports and governance documents available to stockholders [77] Market Environment - The company operates in a highly competitive market, facing challenges in acquiring desirable investments due to competition from financial institutions and other REITs [72] Capital Distribution - The company intends to distribute at least 90% of its REIT taxable income to stockholders to maintain REIT status, aiming for 100% to avoid tax liabilities [76] - The company may return capital through stock buybacks or dividends, depending on the risk-adjusted returns from new investments [76] Corporate Philanthropy - The company actively engages in corporate philanthropy and employee volunteerism, contributing to community stability and development [64] Leadership - The company’s executive team includes experienced leaders, such as David L. Finkelstein, who has over 25 years of experience in fixed income investments [49] Regulatory Compliance - The company is subject to extensive regulatory requirements, including compliance with the Investment Advisers Act and various consumer protection laws [70]