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ANNALYⓇ ANNALY CAPITAL MANAGEMENT , INC . REPORTS 1st QUARTER 2021 RESULTS NEW YORK - April 28 , 2021 - Annaly Capital Management , Inc. ( NYSE : NLY ) ( " Annaly " or the " Company " ) today announced its financial results for the quarter ended March 31 , 2021 . Financial Highlights • • GAAP net income of $ 1.23 per average common share for the quarter , up from $ 0.60 in the prior quarter Core earnings ( excluding PAA ) of $ 0.29 per average common share for the quarter , down $ 0.01 quarter - over - quarter and up $ 0.08 year - over - year with dividend coverage of + 130 % Economic return and tangible economic return ( " ) of 2.8 % and 3.6 % , respectively , for the first quarter Annualized GAAP return on average equity of 49.9 % and annualized core return on average equity ( excluding PAA ) of 12.5 % Book value per common share of $ 8.95 , up $ 0.03 quarter - over - quarter and reflecting a ( $ 0.07 ) per share impact primarily resulting from the writedown of goodwill related to the Company's 2013 acquisition of CreXus Investment Corp. Tangible book value per common share ( ) of $ 8.93 , up $ 0.10 quarter - over - quarter Economic leverage of 6.1x , down slightly from 6.2x the prior quarter Declared quarterly common stock cash dividend of $ 0.22 ] per share Business Highlights Investment and Strategy • • • Total assets of $ 100.4 billion including $ 92.6 billion in highly liquid Agency portfolio ( 2 ) Announced agreement to sell Commercial Real Estate business for $ 2.33 billion , delivering compelling execution for shareholders that will provide additional capacity to further expand leadership and capabilities in residential mortgage finance ( 3 ) Agency portfolio activity focused on reinvestment of paydowns into a mix of spec pools and TBAs ; proactively rotated into higher coupons given the increase in rates Capital allocation to residential credit business nearly doubled to approximately 13 % driven by ~ $ 1.4 billion of accretive securities and whole loan purchases Increased hedge ratio to 75 % from 61 % ; continued to opportunistically sell duration through Treasury future shorts and swaptions to protect against the significant rise in long - end yields Financing and Capital • • • • $ 8.9 billion of unencumbered assets , including cash and unencumbered Agency MBS of $ 6.2 billion Continued record - low financing costs with average GAAP cost of interest bearing liabilities declining 9 basis points to 0.42 % and average economic cost of interest bearing liabilities flat at 0.87 % Annaly Residential Credit Group priced two residential whole loan securitizations totaling $ 611 million since the beginning of the first quarter , bringing aggregate issuance to $ 5.5 billion over 14 transactions since the start of 2018 ( 4 ) Annaly Middle Market Lending Group expanded credit facility capacity by $ 180 million Corporate Responsibility & Governance • • Adjusted long - term target operating expense ratio to a range of 1.45 % to 1.60 % following announcement of Commercial Real Estate Business disposition to incorporate additional expected cost savings ( 5 ) Expanded Board of Directors with election of new Independent Director Eric A. Reeves Signed the CEO Action for Diversity and Inclusion pledge , affirming our commitment to advancing diversity and inclusion in the workplace " We are pleased with our results to start the year with strong underlying performance from our businesses and proactive portfolio management enabling book value growth despite a rapid sell - off in rates , " remarked David Finkelstein , Annaly's Chief Executive Officer and Chief Investment Officer . " Further , the sale of our Commercial Real Estate business marks a notable strategic milestone that will provide us with additional flexibility to focus on our core residential mortgage finance business . We look forward to expanding our capabilities and opportunity set within housing finance , including increased exposure to mortgage servicing rights , new residential whole loan acquisition channels and other complementary products . " " We remain constructive on the outlook for Agency MBS given ongoing support from the Federal Reserve , robust demand from banks and other investors , sustained low financing costs and a moderating prepay environment . Meanwhile , credit assets should benefit from the strengthening economy and we maintain optionality to increase our exposure through our Middle Market Lending and CMBS portfolios . With relatively low leverage and substantial liquidity , Annaly is well - positioned to create value for shareholders throughout the remainder of the year . "