MFA · MFA Financial, Inc.

MFA Financial, Inc. reported mixed results for the first quarter of 2026, characterized by a GAAP net loss offset by solid non-GAAP earnings. The GAAP net loss of $(11.4) million, or $(0.11) per share, contrasted with distributable earnings of $31.1 million, or $0.30 per share. The divergence between GAAP and distributable results was primarily driven by unrealized losses on residential whole loans and securities held at fair value, alongside derivative losses, which management excludes from the distributable metric to reflect core operating performance. A new non-GAAP measure, 'Distributable earnings prior to realized credit losses,' was introduced this quarter at $0.34 per share to provide further clarity on operating earnings excluding credit loss volatility.

Operationally, the company grew its investment portfolio to $12.5 billion, acquiring over $1 billion in residential mortgage assets including $392.8 million of Agency MBS and $470.6 million of Non-QM loans. Lima One, the company's originations subsidiary, contributed significantly with $7.7 million in mortgage banking income, a 34% increase from the prior quarter, and a robust origination pipeline. Management highlighted strategic progress in resolving $163 million of previously delinquent loans and executing two Non-QM securitizations totaling $757.2 million. Credit metrics showed a slight deterioration in the quarter, with 60+ day delinquencies rising to 7.8% from 7.1%, though management noted a subsequent improvement to 7.3% post-quarter. The company maintained a conservative recourse leverage ratio of 2.7x and declared a $0.36 per share dividend, representing a 13.9% yield as of May 1, 2026.