Annaly Capital Management, Inc. Reports 3rd Quarter 2025 Results

Core Insights - Annaly Capital Management reported a strong financial performance for the third quarter of 2025, achieving an economic return of 8.1% for the quarter and 11.5% year-to-date, with earnings exceeding dividends [3][7]. Financial Highlights - GAAP net income per average common share was $1.21 for the quarter, compared to $0.03 in the previous quarter and $0.05 a year ago [7][23]. - Earnings available for distribution (EAD) per average common share was $0.73, unchanged from the previous quarter and up from $0.66 a year ago [7][26]. - Book value per common share increased to $19.25 from $18.45 in the previous quarter [7][8]. - Total portfolio value reached $97.8 billion, with $87.3 billion in a highly liquid Agency portfolio, which increased by 10% [7][8]. Business Highlights - The Agency MBS portfolio benefited from significant spread tightening due to increased demand and reduced volatility [3][4]. - The Residential Credit portfolio grew by 4% to $6.9 billion, driven by record correspondent channel activity and securitization issuance of nearly $4 billion [7][8]. - The Mortgage Servicing Rights (MSR) portfolio increased by 6% to $3.5 billion, representing 19% of dedicated capital [7][8]. Investment and Strategy - The company raised $1.1 billion in accretive capital during the quarter, including $823 million in common equity and $275 million through preferred stock issuance [7][8]. - The hedge ratio remained stable at 92%, with new hedges primarily allocated to swaps to enhance overall portfolio returns [7][8]. Financing and Capital - Annaly's total assets available for financing amounted to $8.8 billion, including $5.9 billion in unencumbered Agency MBS [7][8]. - The average GAAP cost of interest-bearing liabilities decreased to 4.73%, while the average economic cost increased slightly to 3.96% [7][8].