Mfa Financial Stock Earnings Reports

Q1 2026 highlights relevant to investors: MFA produced a quarterly total economic return of -1.2% with GAAP book value of $12.70 and economic book value of $13.22 (both down ~3.8% YoY). GAAP loss was ~$1 million (≈$0.11/sh), while distributable earnings (DE) were $31.1 million ($0.30/sh), up from $0.27/sh in Q4. Management introduced a supplemental DE metric that excludes realized credit losses on residential whole loans held at fair value to provide clearer visibility into underlying earnings power. The investment portfolio grew to $12.5 billion (adding ~ $700M of agencies including TBAs, $471M of non‑QM loans, and $219M of Lima One originated business‑purpose loans). Non‑QM remains the largest asset class ($5.5B) and MFA completed two non‑QM securitizations in March (including a relever that unlocked ≈$40M of cash and additional financing capacity). Lima One originated $219M in business‑purpose loans and increased mortgage‑banking income to $7.7M (up 34% QoQ); origination pipeline and wholesale channel momentum improved. Delinquencies in the residential portfolio rose to 7.8% for the quarter, driven largely by legacy multifamily transitional loans in runoff; management expects realized credit losses on that legacy portfolio to accelerate in Q2 (mid‑ to high‑teens percentage on resolutions) and then normalize through H2 2026 into 2027. Cost actions include a corporate move that generated one‑time accelerated depreciation (~$2.4M in Q1 and an expected additional ~$5M in Q2) but is expected to yield ~ $4M/year in run‑rate savings from the move and roughly $20M/year total overhead reduction vs. 2024 to date. Capital strategy remains active: issuing preferred via ATM to repurchase common stock (accretive without shrinking equity base) and shifting financing toward non‑mark‑to‑market leverage where appropriate. Management notes market volatility from geopolitics (Middle East conflict) drove higher rates and wider spreads at quarter end but highlights market functioning and execution (securitizations, TBA purchases) during the dislocation. Subsequent to quarter end, economic book value was approximately flat to quarter end.