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American Capital Agency Corp. Generates $1.3 Billion in Comprehensive Income

OCT 30, 2012 10:27am ET
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American Capital Agency Corp. generated $1.3 billion in comprehensive income in the third quarter and separately said it has authorized the repurchase of up to $500 million shares of its common stock through December of next year.
The agency mortgage real estate investment trust said it plans only to repurchase shares when the repurchase price is less than its estimate of the current net book value of a share of common stock.
Commenting on its earnings, president and chief investment officer Gary Kain said, "We are very pleased with AGNC's performance during the third quarter as we were able to generate economic returns (dividends plus gains in our net asset value per common share) of $4.33 per common share for the quarter, or 59% on an annualized basis.
“Comprehensive income, which is essentially a mark-to-market earnings measure, was a record $1.3 billion or $3.98 per common share for the quarter. Year-to-date, AGNC has generated $8.53 per common share of shareholder value through the combination of $3.75 in dividends and increases in net asset value of $4.78 per common share, or a year-to-date annualized economic return of 41%.
"These results, coupled with our average actual CPR of 9% for the third quarter (and 9% CPR in the latest prepayment release), clearly demonstrate the benefits of active portfolio management, especially in an evolving landscape. Looking ahead, we believe prepayment speed increases will remain muted on our portfolio despite today's record low mortgage rates and the Federal Reserve's third quantitative easing program, commonly known as QE3."

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