AGNC Investment Corp. Q4 FY2024 earnings call

Peter Federico mentioned favorable investment themes in 2024 continued. Fed shifted policy, 2025 agency MBS supply and demand balanced, spreads expected to stay in range. Bernie Bell discussed Q4 financial results, equity issuance, leverage, and net spread income. Chris Kuehl talked about fixed income landscape, agency MBS performance, portfolio composition, and hedge adjustments.

AGNC's 2024 full-year economic return was 13.2%. In Q4, comprehensive loss was $0.11 per common share, with economic return on tangible common equity negative 0.6%. Raised $511 million of common stock in Q4. Average and ending leverage was 7.2 times tangible equity. Unencumbered cash and agency MBS at $6.1 billion or 66% of tangible equity.

Management is optimistic about agency MBS in 2025 with balanced supply and demand, spreads expected to stay in attractive range. 2024 full-year economic return positive 13.2%, Q4 negative due to higher rates and wider spreads, but 2025 outlook favorable based on current conditions.

Risks include monetary and fiscal policy uncertainty, presidential election impact on fiscal policy and treasury issuance, interest rate volatility, and uncertainty regarding GSE conservatorships.

Q: Bose George asked about equity issuance magnitude and ROE math with treasury futures vs swaps.

A: Peter Federico discussed opportunistic equity issuance and ROE differences with different hedges.

Q: Doug Harter asked about dividend outlook and mark-to-market vs dividend.

A: Peter Federico talked about total cost of capital and expected ROE.

Q: Crispin Love asked about hedge ratio and agency MBS demand.

A: Peter Federico and Chris Kuehl discussed hedge adjustments and demand outlook.

Q: Trevor Cranston asked about leverage target and relative value.

A: Peter Federico and Chris Kuehl talked about leverage and TBA vs pool allocation.

Q: Eric Hagen asked about bank regulation and repo impact.

A: Peter Federico discussed bank balance growth and repo market.

Q: Jason Stewart asked about futures impact and ATM timing.

A: Peter Federico and Bernie Bell talked about disclosure and accretion.

Q: Harsh Hemnani asked about risks to spread base case.

A: Peter Federico and Chris Kuehl discussed interest rate and GSE uncertainty risks.