MFA Financial, Inc.

Greetings and welcome to the MFA Financial Third Quarter 2026 Financial Results Call. At this time, all participants are in a listen-only mode. A question and answer session will follow the formal presentation. If anyone should require operator assistance during the conference, please press star zero on your telephone keypad. As a reminder, this conference is being recorded. I would now like to turn the conference over to your host, Harold Schwartz, General Counsel. Thank you. You may begin.

Thank you, Operator, and good morning, everyone. The information discussed on this conference call today may contain or refer to forward-looking statements regarding MFA Financial, Inc., which reflect management's beliefs, expectations, and assumptions as to MFA's future performance and operations. When used, statements that are not historical in nature, including those containing words such as will, believe, expect, anticipate, estimate, should, could, would, or similar expressions are intended to identify forward-looking statements. All forward-looking statements speak only as of the date on which they are made. These types of statements are subject to various known and unknown risks, uncertainties, assumptions, and other factors, including those described in the MFA's annual report on Form 10-K for the year ended December 31, 2025, and other reports that it may file from time to time with the Securities and Exchange Commission. These risks, uncertainties, and other factors could cause MFA's actual results to differ materially from those projected, expressed, or implied in any forward-looking statements it makes. For additional information regarding MFA's use of forward-looking statements, please see the relevant disclosure in the press release announcing MFA's third quarter 2026 financial results. Thank you for your time. I would now like to turn the call over to MFA's CEO, Craig Knutson.

Thank you, Hal. Good morning, everyone, and thank you for joining us for MFA Financial's third quarter 2026 earnings call. With me today are Bryan Wulfsohn, our President and Chief Investment Officer, Mike Roper, our Chief Financial Officer, and other members of our senior management team. Before I get to the quarter, I'd like to say a few words about the announcement that we made on October 8th. As you I'm sure saw, I plan to retire from my role as Chief Executive Officer at the end of June next year, and Bryan will become President and CEO on July 1st, 2027. Bryan will also join our board on January 1st of next year, and I expect to remain on the board after I retire, so I'm not going to disappear. This transition is the result of a deliberate succession process on which I have been working with our board since early 2023. Bryan has run our residential whole loan portfolio since we began buying loans in 2014, and since late 2024, has overseen Lima One and our agency MBS and BPL portfolios. Bryan has played an active and central role in shaping both the MFA of today and the strategy that guides us. I've worked with him for over 20 years, both at MFA and previously, and I can't think of anyone better suited to lead the company than Bryan. We also announced that Andrew Cahill will join us on January 1st as Chief Investment Officer. I've known Andrew for over 15 years, and he brings over 25 years of mortgage finance experience, most recently as head of residential lending at Starwood Capital. Andrew's arrival will let Bryan spend the first half of next year preparing to step into the CEO role, while our investment team gains the benefit of another very experienced leader with deep expertise in our target assets. Bryan will say more about this in a few minutes. It's been a privilege to work at MFA for the last 18 and a half years, and to lead the company for the last nine. I'm sure I'll have more to say on that topic in the coming months, but for now, there's plenty of work to do, so let me turn to the quarter. The third quarter was a difficult one for rates, particularly in September. During the quarter, the market began to come to terms with a more hawkish Fed as inflation remained sticky and the economy and payroll stayed strong. In September, the Fed raised the Fed funds rate by 25 basis points, their first increase since 2023, and the accompanying message made clear that more increases will likely follow. Although the Fed left rates unchanged at their meeting last week, market expectations are overwhelmingly anticipating a hike at the December meeting. Treasury yields moved sharply higher in the third quarter. The two-year yield rose over 70 basis points during the quarter from 417 to 489. The 10-year rose almost 85 basis points from 446 to 529, the highest level in two decades. The last time the 10-year closed this high was in 2007. Most of that move came in September and much of it in the final week. Oil prices climbed with continued tension with Iran. Rate volatility spiked with the move index rising from the high 70s at the start of September to above 110 at month end. its largest one-week jump since April of last year. Against that backdrop, credit spreads were relatively resilient, but mortgage spreads were not. Agency MBS underperformed meaningfully in September. Non-QM securization spreads, which tightened into mid-September, widened back out to about 140 to 150 basis points on AAAs by quarter end. Mortgage rates rose above 7.25%, up about 50 basis points in September alone. We felt the impact of these moves. Our portfolio carries interest rate risk that we hedge to an approximate one-year duration gap, but the combination of a sharp increase in rates, wider mortgage spreads, and swap rates that rose less than Treasury's collectively worked against us. It is worth noting that most of the book value decline was due to unrealized losses from marks. Mike will walk through the drivers in more detail. While book value was disappointing, we continued to make progress on the operating priorities we laid out for you over the past year. First, we continued to work through our legacy credit book, realized credit losses improved from the second quarter as we said they would. Our overall portfolio 60 plus day delinquency rate improved again to 6.7% and our legacy multifamily portfolio shrank to under 300 million UPB and 263 million fair value. With a clear path to resolution on most of the remaining multifamily loans, and most of these losses already reflected in DE, we believe our multifamily credit issues are largely behind us, particularly as we look forward to 2027. Second, the earnings power of the portfolio continued to improve. Distributable earnings rose to 26 cents per share from 12 cents in the second quarter, and DE prior to realized credit losses was 44 cents per share. Third, we kept our expense base tight. G&A for the quarter was $23.6 million, well below the $33 million quarterly average of 2024. Fourth, we continued issuing in the securitization market. We issued a new $447 million NPL securitization in September after calling our 2024 NPL deal, unlocking an additional $40 million of capital, and issued a non-QM deal shortly after quarter end. As we have discussed previously, the securitization markets are remarkably deep and resilient, even in the face of general fixed income market volatility. None of this makes the third quarter book value decline easier to accept, and we still have more work to do. We need to finish resolving the legacy credit book and turn improving earnings power into consistent results. But the same market that hurt us in the third quarter has also created opportunity. Loans that we acquired in Q3 carried an average coupon of 7.8%. We expect returns on new investments today will produce mid- to high-teen ROEs. We will remain disciplined, but we will continue to put capital to work in this attractive investment environment. I'd like to turn the call over to Mike now to discuss our financial results.