Annaly Capital Management, one of the nation’s largest mortgage investing REITs, earned just shy of $700 million in the first quarter, double what it earned in the same period a year earlier.
Excluding unrealized gains (and losses) on interest rate swaps, net income totaled $530mn.
The company said it benefited from slowing prepayment speeds on the MBS it buys, and experienced a widening in spreads.
“During the quarter we were able to take advantage of the attractive investment environment and grow our balance sheet in a prudent manner," Annaly CEO Michael Farrell said. "We expect market conditions to continue to reflect the uncertainty of regulatory, fiscal and monetary policy outcomes, as well as overall domestic and global economic conditions.”
During the quarter the New York-based firm sold $4.2 billion of mortgage-backed securities and agency debentures, resulting in a realized gain of $27.2 million.
At the end of March, Annaly had assets of $98 billion, compared with $72 billion a year ago. It invests in most agency MBS and securities.