Company: MFAN
Filing Date: 2025-08-06
Form Type: 10-Q
Source: 0001055160-25-000013
Chunk: 26

Company: MFA FINANCIAL, INC.
Filing Date: 2025-08-06
Form: 10-Q
Item: Part I, Item 2
Chunk 26
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June 30, 2025March 31, 2025Net gain/(loss) on residential whole loans measured at fair value through earnings33,611 $54,380 Impairment and other net gain/(loss) on securities and other portfolio investments6,645 21,179 Net gain/(loss) on real estate owned(2,911)(1,508)Net gain/(loss) on derivatives used for risk management purposes(18,251)(31,055)Net gain/(loss) on securitized debt measured at fair value through earnings(7,105)(21,931)Lima One mortgage banking income6,087 5,437 Net realized gain/(loss) on residential whole loans held at carrying value(343)(539)Other, net(5,483)(1,451)Other Income/(Loss), net$12,250 $24,512 

Operating and Other Expense

Operating and other expenses are composed of compensation and benefits, other general and administrative, loan servicing and other related operating expenses and amortization of Lima One intangible assets.

Compensation and benefits expenses are composed of salaries, annual bonus, stock-based awards, long-term incentives, Lima One sales commissions, related payroll taxes, medical insurance, 401(k) matching and other benefits expenses.  Compensation and benefits expense decreased by $3.9 million to $19.3 million for the second quarter of 2025, compared to $23.3 million for the first quarter of 2025, primarily as a result of the inclusion of accelerated recognition of stock-based compensation in the first quarter of 2025 related to awards made to retirement eligible employees in January 2025, as well as inclusion in the first quarter of 2025 of 2024 year-end bonus related expenses, and a reduction in the 2025 year-end bonus accrual, partially offset by higher expense recognition from the accrual of severance costs.

Other general and administrative expenses are comprised of leasing and other office expenses, professional fees, insurance costs, board of directors fees, and miscellaneous expenses. Other general and administrative expenses of $10.6 million for the second quarter of 2025 were higher when compared to $10.3 million for the first quarter of 2025, primarily driven by rental expenses for the new Lima One headquarters and an increase as a result of the waiver of certain expenses in the first quarter of 2025, partially offset by lower expenses at Lima One and lower professional fees at our corporate