Company: MFAN
Filing Date: 2025-11-06
Form Type: 10-Q
Source: 0001055160-25-000018
Chunk: 164

Company: MFA FINANCIAL, INC.
Filing Date: 2025-11-06
Form: 10-Q
Item: Part I, Item 1
Chunk 164
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 fair value option has been elected or for which specialized loan accounting is otherwise applied, we assess our ability and intent to continue to hold each asset and, as part of this process, we monitor our investments in securities that are designated as AFS for impairment.  A change in our ability and/or intent to continue to hold any of these securities that are in an unrealized loss position, or a deterioration in the underlying characteristics of these securities, could result in our recognizing future impairment charges or a loss upon the sale of any such security.  

Our residential mortgage investments have longer-term contractual maturities than our non-securitization related financing liabilities, and the interest rates we pay on our non-securitization related financings will typically change at a faster pace than the interest rates we earn on our investments.  In order to reduce this interest rate risk exposure, we may enter into derivative instruments, which currently include Swaps.  

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Recent Market Conditions and Our Strategy

During the third quarter of 2025, fixed-income market conditions were mixed as investors reacted to evolving macroeconomic data and changing monetary policy expectations. In September 2025, the Federal Reserve reduced the Federal Funds rate by 25 basis points, and reinforced market expectations for further rate reductions in the near term. Fixed-income markets delivered positive returns, with the Bloomberg US Aggregate Index returning 2.03% for the third quarter. During the quarter, we were able to add $1.2 billion of our target assets at attractive yields. These additions included approximately $452.8 million of Non-QM loans, approximately $225.9 million of funded originations of Business purpose loans and draws on existing Transitional loans by Lima One, and approximately $472.8 million of Agency MBS. Given the increased clarity on the projected path of interest rates, lower market volatility, and the increased liquidity of our portfolio, we expect to increase the pace of asset acquisitions in the near term. During the quarter, we executed two securitizations and issued $672.8 million of securitized debt. During the quarter, we made further progress reducing portfolio delinquencies, resolving $222.8 million of previously delinquent loans and reduced overall 60+ day delinquency from 7.5% at the start of the year to 6.8% at September 30, 2025. 

During the quarter, we generated GAAP earnings per share (or EPS) of $0.36 per basic common share and Distributable earnings,