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Here are 1-2 brief analogies for Annaly Capital Management:

• Like a BlackRock that specializes primarily in mortgage-backed securities.

• Like Simon Property Group, but investing in mortgage bonds and loans instead of malls and physical properties.

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• Mortgage-Backed Securities (MBS): The company invests in securities backed by pools of residential and commercial mortgages, including those guaranteed by government agencies and those without such guarantees.
• Mortgage Servicing Rights (MSRs): Annaly acquires the contractual right to perform various administrative tasks for mortgage loans in exchange for a fee.
• Residential Mortgage Loans: The company directly invests in loans made to individuals for the purchase of residential properties.
• Credit Risk Transfer Securities (CRTs): These are investments in securities that transfer a portion of the credit risk associated with mortgage loans from originators to private investors.
• Corporate Debt: Annaly provides financing to middle market companies by investing in their debt instruments.
• Commercial Real Estate Investments: The company engages in various other investments related to commercial properties beyond mortgage-backed securities.

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Annaly Capital Management (NLY) operates as a diversified capital manager, primarily engaged in mortgage finance and corporate middle market lending. As an investment firm and lender, it does not have traditional "customers" who purchase goods or services in the conventional sense. Instead, it provides capital and financing, and the entities that receive or benefit from this capital can be considered its "customers" or beneficiaries.

Based on its activities, Annaly Capital Management serves the following categories of entities:

• Middle-Market Corporations: These are typically private companies that receive direct corporate debt financing and lending from Annaly to support their operations, growth, or other strategic initiatives. Annaly's "corporate middle market lending" focuses on providing capital to these businesses. Due to their private nature and the diversified portfolio, specific names of these customer companies are not publicly disclosed.
• Residential Homeowners: Annaly's investments in residential mortgage loans and agency/non-agency mortgage-backed securities ultimately provide capital that facilitates homeownership. While Annaly primarily deals with financial institutions (e.g., originators, securitizers) to acquire these assets, the end beneficiaries of this mortgage finance are individual homeowners.
• Commercial Real Estate Businesses: Through investments in Agency commercial mortgage-backed securities and other commercial real estate investments, Annaly provides capital that supports businesses involved in the ownership, development, or management of commercial properties.

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David L. Finkelstein Chief Executive Officer and Co-Chief Investment Officer

Mr. Finkelstein has over 25 years of experience in fixed income investments. He was appointed Chief Executive Officer in March 2020. Prior to joining Annaly in 2013, Mr. Finkelstein served for four years as an Officer in the Markets Group of the Federal Reserve Bank of New York, where he was the primary strategist and policy advisor for the Mortgage-Backed Securities (MBS) Purchase Program. Before that, he held senior Agency MBS trading positions at Salomon Smith Barney, Citigroup Inc., and Barclays PLC.

Serena Wolfe Chief Financial Officer

Ms. Wolfe has over 25 years of experience in accounting, with 13 years specifically focused on real estate practice. She joined Annaly in December 2019. Prior to Annaly, Ms. Wolfe served as a Partner at Ernst & Young LLP ("E&Y") since 2011, and most recently led EY's Central Region Real Estate Hospitality & Construction practice from 2017 to November 2019. Ms. Wolfe currently serves on the board of Lennar Corporation and Doma Holdings, Inc.

Steven F. Campbell President and Chief Operating Officer

Mr. Campbell brings over 25 years of experience in financial services. Prior to joining Annaly in April 2015, he held various roles over six years at Fortress Investment Group LLC, including serving as a Managing Director in the Credit Funds business. He also worked at General Electric Capital Corporation and D.B. Zwirn & Co., L.P.

Michael Fania Co-Chief Investment Officer and Head of Residential Credit

Mr. Fania possesses over 15 years of experience in mortgage trading and portfolio management. Before joining Annaly in 2015, he was an Associate Director at MetLife Investments, where he was responsible for residential credit trading and strategy.

Johanna Griffin Chief Risk Officer

Ms. Griffin has over 25 years of experience in various risk management roles. Prior to joining Annaly in 2015, she was the Head of Securitized Products Market Risk at Barclays Capital. Before her time at Barclays, Ms. Griffin held various market risk positions, primarily covering fixed income trading and products at UBS Securities, PaineWebber, and Lehman Brothers.

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Key Risks to Annaly Capital Management (NLY)

• Interest Rate Risk: Annaly's business model as a mortgage REIT is highly sensitive to changes in interest rates. Rising interest rates can increase its borrowing costs, compress its net interest margin (the difference between interest earned on assets and interest paid on liabilities), and decrease the fair value of its existing fixed-income portfolio, including Agency and non-Agency mortgage-backed securities. Conversely, significant declines in rates can exacerbate prepayment risk.
• Credit Risk: Annaly invests in assets such as non-Agency residential mortgage assets, residential mortgage loans, credit risk transfer securities, and corporate debts. These investments expose the company to the risk of borrower defaults and credit losses, particularly during economic downturns or stress in the housing and corporate debt markets.
• Prepayment Risk: As a significant holder of mortgage-backed securities and residential mortgage loans, Annaly is exposed to prepayment risk. When interest rates fall, borrowers tend to refinance their mortgages, leading to faster-than-anticipated prepayments on Annaly's assets. This forces the company to reinvest the principal proceeds at potentially lower prevailing interest rates, which can reduce its overall yield and net interest income.

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Addressable Markets for Annaly Capital Management (NLY)

Annaly Capital Management, Inc. operates in various sectors of the U.S. financial markets. The addressable markets for its main products and services are primarily within the United States.

• Agency Mortgage-Backed Securities (MBS): The U.S. MBS market is substantial, with over $11 trillion in outstanding securities and an average daily trading volume of nearly $300 billion. As of mid-2023, outstanding MBS in the United States exceeded $11 trillion, and the market size was estimated at USD 15.55 trillion in 2025. Gross agency MBS issuance totaled approximately $1.1 trillion in 2024.
• Mortgage Servicing Rights (MSRs): The MSR market in the U.S. was robust in 2024, with trading volumes approaching $1 trillion, a trend projected to continue into 2025. In 2022, nonbank mortgage companies held servicing rights on 54% of U.S. mortgage balances. The global loan servicing market, where the U.S. holds the largest share in North America, was valued at USD 3.48 billion in 2024 and is expected to reach USD 9.89 billion by 2033.
• Agency Commercial Mortgage-Backed Securities (CMBS): The amount of Agency CMBS outstanding in the U.S. was approximately USD 863 billion as of July 31, 2021. U.S. insurance companies' exposure to both agency and private-label CMBS was $287 billion at year-end 2024, with Agency CMBS constituting 28% of this total.
• Non-Agency Residential Mortgage Assets (Non-Agency RMBS): This is a large and diverse market in the U.S., with over $1.7 trillion in outstanding securities. Non-agency RMBS represent a significant portion of the $15.3 trillion U.S. securitized market. New issuance in the non-agency RMBS market was approximately $145 billion in 2024, and around $180 billion in new issue deals occurred in 2025. The market size was reported as $0.6 trillion (or $600 billion) as of December 31, 2023.
• Residential Mortgage Loans: The U.S. home loan market reached USD 2.42 trillion in 2026 and is projected to grow to USD 3.17 trillion by 2031. The broader residential mortgage loan market size was estimated at USD 12,500.75 billion in 2024 and is projected to reach USD 21,500.40 billion by 2032. Total single-family mortgage origination volume is expected to increase to $2.2 trillion in 2026.
• Credit Risk Transfer (CRT) Securities: The U.S. CRT market has grown to more than $50 billion and references approximately $2 trillion of single-family mortgage loans. U.S. banks issued an estimated $7 billion in CRTs in 2023. The global synthetic risk transfer (SRT) market, a type of CRT, has expanded significantly, with annual issuance reaching €21 billion in 2024, protecting underlying loan portfolios of €260 billion.
• Corporate Debts (Corporate Middle Market Lending): The U.S. middle market direct lending segment was estimated at $1.0 trillion as of March 31, 2022. Bank commercial lending, a competitive market for direct lenders, is $2.6 trillion. Direct lending represents the largest component of private credit, with approximately $850.5 billion in assets. The asset-based lending market, a component of middle market finance, reached $661.7 billion in 2023.
• Other Commercial Real Estate Investments: The United States Commercial Real Estate Market is estimated at USD 1.74 trillion in 2026, projected to reach USD 1.97 trillion by 2031. Other estimates for the U.S. commercial real estate market size include USD 66.33 billion in 2024, expected to grow to USD 112.03 billion by 2035, and USD 742.3 billion in 2025, projected to reach USD 995.6 billion by 2034. The total value of commercial real estate in the U.S. was estimated at $16 trillion in 2018. The U.S. CMBS market, a segment of commercial real estate, has a market capitalization of around $1.7 trillion.

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Annaly Capital Management (NLY) is expected to drive future revenue growth over the next two to three years through several key strategies and market conditions:

1. Expansion of the Agency Mortgage-Backed Securities (MBS) Portfolio: Annaly's core Agency portfolio has shown significant growth, increasing by 10% to reach $87.3 billion, while maintaining a stable average coupon positioning at 5.03%. This expansion contributes to higher average investment balances, which in turn boosts the company's Earnings Available for Distribution (EAD). The company sees the Agency market as "perfectly fair" for continued investment.
2. Growth of the Mortgage Servicing Rights (MSR) Portfolio: The MSR portfolio has been a strong growth area for Annaly, with its market value increasing by 8.6% to $3.8 billion and representing approximately 19% of the firm's capital. Annaly significantly increased its MSR holdings in 2023, acquiring $42 billion in principal balance, and the portfolio grew by 15% year-over-year by Q4 2025. The targeted return on MSR has also increased from 10-12% to 12-14%, primarily due to higher projected float income associated with short rates.
3. Development of the Residential Credit Business via the Onslow Bay Correspondent Channel and Securitization Platform: Annaly's residential credit portfolio experienced a robust 16% increase, reaching $8.0 billion. The Onslow Bay correspondent channel achieved record growth in Q1 2024 through attractive yields and recorded all-time highs in lock volume, fundings, and securitization issuance in Q4 2025. Annaly is strategically positioned to benefit from the anticipated growth and liquidity in the non-qualified mortgage (non-QM) market and the broader non-agency market, which is projected to see its highest gross securitization issuance since 2007.
4. Favorable Interest Rate Environment and Stable Spreads: A more predictable monetary policy outlook and declining interest rate volatility are expected to benefit Annaly. The prospect of lower interest rates and improved mortgage spreads could lead to enhanced net interest margins and an increase in book value, directly supporting revenue growth. The company's prior struggles with rising interest rates are diminishing as rates begin to come down.

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Share Repurchases

• Annaly Capital Management's board approved a new common share repurchase program on January 31, 2025, authorizing up to $1.5 billion in buybacks through December 31, 2029.
• As of February 18, 2026, no shares had been repurchased under the $1.5 billion common share buyback program announced in January 2025.
• On December 31, 2024, the board also authorized a new preferred share repurchase program, which allows for the repurchase of up to an aggregate of 63.5 million shares across its Series F, G, and I preferred stock, expiring on December 31, 2029.

Share Issuance

• For the full year 2025, Annaly raised a total of $2.9 billion in equity.
• This included raising $560 million in common equity during the fourth quarter of 2025 through its at-the-market (ATM) program.
• In 2025, the company issued $275 million in preferred stock, including new 8.875% fixed-rate Series J preferred shares.

Outbound Investments

• Annaly's total investment portfolio grew by nearly 30% in 2025, reaching $104.7 billion by the end of the year.
• The Agency portfolio, which is the largest component, increased by 32% or $22 billion throughout 2025.
• In October 2025, Annaly entered into a long-term subservicing and Mortgage Servicing Rights (MSR) purchase agreement with PennyMac Financial Services.