Company: NLY-PF
Filing Date: 2025-10-30
Form Type: 10-Q
Source: 0001043219-25-000012
Chunk: 74

Company: ANNALY CAPITAL MANAGEMENT INC
Filing Date: 2025-10-30
Form: 10-Q
Item: Part I, Item 2
Chunk 74
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 mortgage, Treasury or bond payments, which is separated and sold individually from the principal portion of those same payments.Interest Rate RiskThe risk that an investment’s value will change due to a change in the absolute level of interest rates, in the spread between two rates, in the shape of the yield curve or in any other interest rate relationship. As market interest rates rise, the value of current fixed income investment holdings declines. Diversifying, deleveraging and hedging techniques are utilized to mitigate this risk. Interest rate risk is a form of market risk.

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ANNALY CAPITAL MANAGEMENT, INC. AND SUBSIDIARIESItem 2. Management’s Discussion and Analysis 

Interest Rate SwapA binding agreement between counterparties to exchange periodic interest payments on some predetermined dollar principal, which is called the notional principal amount. For example, one party will pay fixed and receive a variable rate.Interest Rate SwaptionOptions on interest rate swaps. The buyer of a swaption has the right to enter into an interest rate swap agreement at some specified date in the future. The swaption agreement will specify whether the buyer of the swaption will be a fixed-rate receiver or a fixed-rate payer. Interests in MSRRepresents agreements to purchase all, or a component of, net servicing cash flows.International Swaps and Derivatives Association (“ISDA”) Master AgreementStandardized contract developed by ISDA used as an umbrella under which bilateral derivatives contracts are entered into.Inverse IO BondAn interest-only bond whose coupon is determined by a formula expressing an inverse relationship to a benchmark rate, such as SOFR. As the benchmark rate changes, the IO coupon adjusts in the opposite direction. When the benchmark rate is relatively low, the IO pays a relatively high coupon payment, and vice versa.Investment/Market RiskRisk to earnings, capital or business resulting in the decline in value of our assets caused from changes in market variables, such as interest rates, which affect the values of Residential Securities and other investment instruments.Investment Advisers ActRefers to the Investment Advisers Act of 1940, as amended.Investment Company ActRefers to the Investment Company Act of 1940, as amended.LLeverageThe use of borrowed money to increase investing power and economic returns.Leverage Ratio (GAAP Leverage Ratio or Debt-to-Equity Ratio)Calculated as total debt to total stockholders’ equity. For purposes of calculating this ratio total debt includes repurchase agreements, other secured financing, debt issued by se