Annaly Capital Management (NYSE:NLY) released first-quarter financial results and hosted an earnings call on Wednesday. Read the complete transcript below.
Annaly Capital Management reported a 1.5% economic return for Q1 2026, with earnings available for distribution per share increasing to $0.76.
The company raised $510 million in common equity, deploying most of it into residential credit and mortgage servicing rights (MSR) due to market conditions.
Annaly's portfolio saw strong performance despite volatility, with a conservative leverage of 5.7 times and maintained a diversified housing finance platform.
The company anticipates continued strong risk-adjusted returns from its investment strategies, driven by favorable market conditions and technicals.
Management highlighted the flexibility to dynamically allocate capital and the resilience of its housing finance platform amid geopolitical and market volatility.
Shawn Kensel (Director Investor Relations)
Serena Wolf (Chief Financial Officer)
Mike Fannia (Co Chief Investment Officer and Head of Residential Credit)
David Finkelstein (Chief Executive Officer and Co Chief Investment Officer)
The next question comes from Bose George with kbw. Please go ahead.
The next question Comes from Marissa Lobo with ubs. Please go ahead.
Thanks and good morning. On the increased capital allocation to non agencies in Q1, the presentation states returns of about 12 to 15%. Can you expand on how that looks among the various non agency subsectors you're active in?
I appreciate that detailed answer, Mike. And referencing recent reports from the rating agencies on non QM delinquencies, particularly newer vintage collateral and with the rising pressure reference on the consumer from inflation. And how is that impacting investor appetite down in credit? Has it impacted your credit enhancement and pricing and your deals in any meaningful way?
Got it. Thank you very much. Thank you, Marissa. The next question comes from Rick Shane with JPMorgan. Please go ahead.
issuance in Q1 was really helpful. Thank you. Thank you, Rick.
The next question comes from Maharsh Hemini with Green Street. Please go ahead.
So there were a few securitizations this quarter that included agency eligible loans. Could you maybe talk a little bit about the dynamic that's incentivizing originators to sell their loans to in the non agency channel over the agency and then how you expect that to trend over the coming quarters?
Got it. That's helpful. That's all for me, thank you. Thanks. Harsh.
The next question comes from Meryl Ross with Compass Point Research and training. Please go ahead.
Thank you and good morning. You mentioned that there were only slight changes in your hedging portfolio despite the shift in your equity allocation, and I'm wondering if the lower periodic income reduces your appetite for hedging with swaps over treasury futures and just how you expect to roll forward your hedge positions in the second quarter. Thank you.
Thank you, I appreciate that view. Thank you. Meryl. The next question comes from Jason Weaver with Jones Trading. Please go ahead.
Well, thanks guys. Congrats on the quarter. I appreciate the color. Thanks, Jason.
The next question comes from Trevor Cranston with Citizens jme. Please go ahead.
This concludes our question and answer session. I would like to turn the conference back over to David Finkelstein for any closing remarks.
Thank you, operator. And thanks everybody for joining today and we'll talk to you next quarter.