Annaly Capital Management Reports Q3 2026 GAAP Net Loss Amid Interest Rate Volatility
Annaly Capital Management (NLY) reported a GAAP net loss of $1.36 per average common share for the third quarter of 2026, primarily driven by unrealized losses on its investment portfolio resulting from rising interest rates and increased volatility in Agency MBS spreads. The company's book value fell 11.4% from the previous quarter to $17.86 per share, while economic return turned negative at -7.6% following an 82 basis point rise in the 10-year Treasury yield. Despite these headwinds, Annaly maintained a healthy dividend coverage with Earnings Available for Distribution (EAD) of $0.80 per share against a $0.75 quarterly dividend. The firm actively managed its capital structure by raising $757 million through at-the-market sales to redeem $442.5 million in Series I floating rate preferred stock. Management also increased its hedge ratio to 100% to defend against duration extension risks.