Annaly Capital Management, Inc., the largest issuer of residential, non-qualifying mortgage-backed securities (Non-QM RMBS) in 2024 with total issuance exceeding $7.6 billion, announced third-quarter earnings, including a quarterly economic return of 4.9% and year-to-date return of 10.5%. Annaly manages a real estate investment trust (REIT).
The quarter ending Sept. 30, 2024, marked only the third quarter of positive net income for the company in the past nine quarters.
As of Sept. 30, 2024, Annaly recorded $7.4 billion of total assets available for financing, including cash and unencumbered agency MBS of $4.7 billion. The company’s mortgage servicing rights ("MSR") portfolio ended the quarter with $2.8 billion in market value, relatively unchanged on a quarterly basis, representing 21% of dedicated equity capital.
In early October, Rocket Mortgage and Annaly entered a subservicing agreement that allows Rocket to handle servicing and recapture activities for a portion of Annaly’s MSR portfolio as the alternative asset manager strives to “increase our competitiveness in purchasing new MSR," said David Finkelstein, Annaly's chief executive and investment officer, during an earnings call.
Under generally accepted accounting principles (GAAP), Annaly generated $0.05 in earnings per common share during the third quarter on roughly $82.3 million in net income. The company recorded a net income loss of roughly $8.8 million in the second quarter, and a net income loss of roughly $569 million in the third quarter of 2023.
