Q4 2024 Annaly Capital Management Inc Earnings Call Transcript
Key Points
- Annaly Capital Management Inc (NLY) achieved a full-year 2024 economic return of 11.9%, demonstrating the strength and diversity of its housing finance portfolio.
- Earnings available for distribution per share increased significantly to $0.72, exceeding the dividend for the quarter due to lower borrowing costs.
- The company raised over $400 million of accretive common equity through its ATM in Q4, bringing the total capital raised in 2024 to $1.6 billion.
- Annaly's residential credit business closed on four securitizations totaling $2.3 billion in Q4, contributing to a record $11 billion in cumulative issuance for the year.
- The MSR portfolio ended the fourth quarter at $3.3 billion in market value, representing a 25% increase year over year, with strong fundamental performance and lower-than-expected prepayment speeds and delinquencies.
- Book value per share decreased by 2% from $19.54 in the prior quarter to $19.15 as of December 31, 2024.
- The company incurred losses on its Agency MBS portfolio of $4.14 per share and on its residential credit portfolio of $0.26 per share during the quarter.
- Despite a decrease in economic leverage, the portfolio's duration extension required proactive management through increased hedges at the long end of the yield curve.
- The competitive landscape in the MSR space is changing significantly, with increased competition from originators focused on recapture.
- The outlook for volatility remains uncertain, with potential impacts on returns, particularly in the Agency MBS segment.
Good morning, everyone, and welcome to the Q4 2024 Annaly Capital Management earnings conference call. (Operator Instructions) Please also note today's event is being recorded.
And at this time, I'd like to turn the floor over to Sean Kensil, Director of Investor Relations. Sir, please go ahead.
Good morning, and welcome to the fourth-quarter 2024 earnings call for Annaly Capital Management. Any forward-looking statements made during today's call are subject to certain risks and uncertainties, which are outlined in the Risk Factors section in our most recent annual and quarterly SEC filings. Actual events and results may differ materially from these forward-looking statements. We encourage you to read the disclaimer in our earnings release in addition to our quarterly and annual filings.
Additionally, the content of this conference call may contain time-sensitive information that is accurate only as of the date hereof. We do not undertake and specifically disclaim any
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