# Invesco Mortgage Capital Inc. (IVR) Informational only - not investment advice. CIK: 0001437071 SIC: 6798 Real Estate Investment Trusts SIC breadcrumb: [Finance, Insurance, And Real Estate](/division/H/) > [Holding And Other Investment Offices](/major-group/67/) > [SIC 6798 Real Estate Investment Trusts](/industry/6798/) Latest 10-K filed: 2026-02-23 SEC page: https://www.sec.gov/edgar/browse/?CIK=1437071 Filing source: https://www.sec.gov/Archives/edgar/data/1437071/000143707126000015/ivr-20251231.htm ## At a glance FY2025 · period end 2025-12-31 · filed 2026-02-23 · accession 0001437071-26-000015 · source: https://data.sec.gov/api/xbrl/companyfacts/CIK0001437071.json | Metric | Value | FY | Provenance | | --- | ---: | ---: | --- | | Revenue | 295,287,000 USD | 2025 | verified | | Net income | 101,279,000 USD | 2025 | verified | | Assets | 6,475,894,000 USD | 2025 | verified | | Net margin | 34.30% | 2025 | computed | | Revenue YoY | +3.05% | 2025 | computed | | ROE | 12.70% | 2025 | computed | Computed values are grepcent-computed from the verified facts above and may differ from ratios the company itself reports. Net margin = net income ÷ revenue. Revenue YoY = FY2025 revenue ÷ FY2024 revenue − 1 (consecutive fiscal years only). ROE = net income ÷ period-end stockholders' equity. No market price, no rating, no forecast on this site. Not investment advice. ### Peer percentile fingerprint | Ratio | IVR | Peer median | Percentile | N | | --- | ---: | ---: | ---: | ---: | | Net margin | 34.3% | 16.8% | 76 | 149 | | Revenue growth | 3.1% | 3.7% | 49 | 149 | | ROE | 12.7% | 5.7% | 87 | 151 | | ROA | 1.6% | 1.5% | 51 | 155 | | Liabilities / equity | 7.12 | 1.48 | 89 | 151 | Percentile = share of the N covered peers reporting that ratio whose value is lower (ties counted half); computed among grepcent-covered companies in SIC industry 6798 Real Estate Investment Trusts, not the whole market. A higher percentile means a higher value of the ratio, not a better company. Ratios with fewer than 8 reporting peers are omitted. Latest reported values per company; fiscal periods may differ. Descriptive arithmetic - not a score, rating, or ranking. ## Selected Fundamentals | Metric | Value | Unit | FY | Filed | | --- | ---: | --- | ---: | --- | | Revenue | 295287000 | USD | 2025 | 2026-02-23 | | Net income | 101279000 | USD | 2025 | 2026-02-23 | | Assets | 6475894000 | USD | 2025 | 2026-02-23 | ## Financials Annual standardized facts from SEC companyfacts as of latest extracted filing date 2026-02-23. Source: https://data.sec.gov/api/xbrl/companyfacts/CIK0001437071.json. Derived margins, ratios, and free cash flow are computed from the extracted annual SEC facts. | Metric | 2016 | 2017 | 2018 | 2019 | 2020 | 2021 | 2022 | 2023 | 2024 | 2025 | | --- | ---: | ---: | ---: | ---: | ---: | ---: | ---: | ---: | ---: | ---: | | Revenue | | 545,055,000 | 643,016,000 | 778,367,000 | 280,166,000 | 169,202,000 | 194,513,000 | 277,929,000 | 286,546,000 | 295,287,000 | | Net income | 254,411,000 | 348,607,000 | -70,790,000 | 364,101,000 | -1,674,352,000 | -90,000,000 | -402,924,000 | -15,859,000 | 59,882,000 | 101,279,000 | | Diluted EPS | 1.98 | 2.75 | -1.03 | 2.42 | -98.93 | -4.82 | -12.21 | -0.85 | 0.65 | 1.32 | | Operating cash flow | 295,797,000 | 290,601,000 | 304,264,000 | 343,359,000 | 170,459,000 | 152,292,000 | 196,083,000 | 237,787,000 | 183,160,000 | 157,085,000 | | Assets | 15,706,238,000 | 18,657,256,000 | 17,813,505,000 | 22,346,545,000 | 8,632,851,000 | 8,443,841,000 | 5,097,395,000 | 5,284,209,000 | 5,688,034,000 | 6,475,894,000 | | Liabilities | 13,436,054,000 | 16,000,378,000 | 15,526,808,000 | 19,414,646,000 | 7,265,693,000 | 7,041,706,000 | 4,293,320,000 | 4,501,544,000 | 4,957,305,000 | 5,678,350,000 | | Stockholders' equity | 2,241,560,000 | 2,630,491,000 | 2,286,697,000 | 2,931,899,000 | 1,367,158,000 | 1,402,135,000 | 804,075,000 | 782,665,000 | 730,729,000 | 797,544,000 | | Cash and cash equivalents | 161,788,000 | 88,381,000 | 135,617,000 | 172,507,000 | 148,011,000 | 357,134,000 | 175,535,000 | 76,967,000 | 73,403,000 | 56,040,000 | ### Ratios ROE and ROA use period-end equity/assets. Liabilities / equity uses total liabilities divided by stockholders' equity. Current ratio uses current assets divided by current liabilities when both are reported. | Metric | 2016 | 2017 | 2018 | 2019 | 2020 | 2021 | 2022 | 2023 | 2024 | 2025 | | --- | ---: | ---: | ---: | ---: | ---: | ---: | ---: | ---: | ---: | ---: | | Net margin | | 63.96% | -11.01% | 46.78% | | -53.19% | | -5.71% | 20.90% | 34.30% | | Return on equity | 11.35% | 13.25% | -3.10% | 12.42% | -122.47% | -6.42% | -50.11% | -2.03% | 8.19% | 12.70% | | Return on assets | 1.62% | 1.87% | -0.40% | 1.63% | -19.40% | -1.07% | -7.90% | -0.30% | 1.05% | 1.56% | | Liabilities / equity | 5.99 | 6.08 | 6.79 | 6.62 | 5.31 | 5.02 | 5.34 | 5.75 | 6.78 | 7.12 | ## As-reported value updates 2 tracked differences above grepcent's stated thresholds were found between the earliest XBRL-filed value and the value currently on file for the same fiscal period. Ledger: /company/IVR/revisions/ ## Quarterly Quarterly standardized facts from SEC companyfacts as of latest extracted filing date 2026-08-05. Source: https://data.sec.gov/api/xbrl/companyfacts/CIK0001437071.json. Flow metrics use discrete quarter-length periods from 10-Q/10-Q/A filings. Q4 revenue and net income are derived only when annual FY and nine-month YTD facts exist for the same fiscal year; derived Q4 values are labeled. EPS Q4 is not derived. | Quarter | End date | Revenue | Net income | Diluted EPS | Method | | --- | --- | ---: | ---: | ---: | --- | | 2022-Q3 | 2022-09-30 | | | -2.78 | reported discrete quarter | | 2023-Q1 | 2023-03-31 | | | 0.39 | reported discrete quarter | | 2023-Q2 | 2023-06-30 | | | -0.03 | reported discrete quarter | | 2023-Q3 | 2023-09-30 | 75,132,000 | -74,024,000 | -1.62 | reported discrete quarter | | 2023-Q4 | 2023-12-31 | 62,082,000 | 22,280,000 | | derived Q4 = FY annual - nine-month YTD | | 2024-Q1 | 2024-03-31 | 68,583,000 | 23,730,000 | 0.49 | reported discrete quarter | | 2024-Q2 | 2024-06-30 | 68,028,000 | -18,766,000 | -0.38 | reported discrete quarter | | 2024-Q3 | 2024-09-30 | 73,825,000 | 35,271,000 | 0.63 | reported discrete quarter | | 2024-Q4 | 2024-12-31 | 76,110,000 | -5,472,000 | | derived Q4 = FY annual - nine-month YTD | | 2025-Q1 | 2025-03-31 | 73,846,000 | 16,289,000 | 0.26 | reported discrete quarter | | 2025-Q2 | 2025-06-30 | 70,624,000 | -26,567,000 | -0.40 | reported discrete quarter | | 2025-Q3 | 2025-09-30 | 72,916,000 | 50,208,000 | 0.74 | reported discrete quarter | | 2025-Q4 | 2025-12-31 | 77,901,000 | 48,243,000 | | derived Q4 = FY annual - nine-month YTD | | 2026-Q1 | 2026-03-31 | 79,641,000 | -23,121,000 | -0.28 | reported discrete quarter | | 2026-Q2 | 2026-06-30 | 85,408,000 | 31,842,000 | 0.34 | reported discrete quarter | ## Filed narrative (10-K & 10-Q) ## Business Verbatim Item 1 Business section from IVR's latest 10-K: [/company/IVR/business/](/company/IVR/business/). ## Risk Factors Verbatim Item 1A Risk Factors from IVR's latest 10-K: [/company/IVR/risk-factors/](/company/IVR/risk-factors/). ## Latest quarter (10-Q) Latest 10-Q source: https://www.sec.gov/Archives/edgar/data/1437071/000143707126000064/ivr-20260630.htm Extracted structurally from real Item 2 body heading to real Item 3/4 boundary. Confidence: high Filing date: 2026-08-05 Report date: 2026-06-30 ITEM 2.    MANAGEMENT’S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS. In this quarterly report on Form 10-Q, or this "Quarterly Report," we refer to Invesco Mortgage Capital Inc. and its consolidated subsidiaries as "we," "us," "our Company," or "our," unless we specifically state otherwise or the context indicates otherwise. We refer to our external manager, Invesco Advisers, Inc., as our "Manager" and we refer to the indirect parent company of our Manager, Invesco Ltd. together with its consolidated subsidiaries (which does not include us), as "Invesco." The following discussion should be read in conjunction with our condensed consolidated financial statements and the accompanying notes to our condensed consolidated financial statements, which are included in Item 1 of this Quarterly Report, as well as the information contained in our most recent annual report on Form 10-K filed with the Securities and Exchange Commission (the “SEC”). Forward-Looking Statements We make forward-looking statements in this Quarterly Report and other filings we make with the SEC within the meaning of Section 27A of the Securities Act of 1933, as amended, and Section 21E of the Securities Exchange Act of 1934, as amended (the “Exchange Act”), and such statements are intended to be covered by the safe harbor provided by the same. Forward-looking statements are subject to substantial risks and uncertainties, many of which are difficult to predict and are generally beyond our control. These forward-looking statements include information about possible or assumed future results of our business, investment strategies, financial condition, liquidity, results of operations, plans, objectives and our views on domestic and global market conditions (including the Agency RMBS, Agency CMBS and residential and commercial real estate markets). When we use the words “believe,” “expect,” “anticipate,” “estimate,” “plan,” “intend,” “project,” “forecast” or similar expressions and future or conditional verbs such as “will,” “may,” “could,” “should,” and “would,” and any other statement that necessarily depends on future events, we intend to identify forward-looking statements, although not all forward-looking statements may contain such words. The forward-looking statements are based on our beliefs, assumptions and expectations of our future performance, taking into account all information currently available to us. You should not place undue reliance on these forward-looking statements. These beliefs, assumptions and expectations can change as a result of many possible events or factors, not all of which are known to us. We caution you not to rely unduly on any forward-looking statements and urge you to carefully consider the factors described under the headings “Risk Factors” and “Management’s Discussion and Analysis of Financial Condition and Results of Operations” in our Annual Report on Form 10-K for the year ended December 31, 2025 and this Report, which may be updated by subsequently filed quarterly reports on Form 10-Q or current reports on Form 8-K . If a change occurs, our business, financial condition, liquidity and results of operations may vary materially from those expressed in our forward-looking statements. Any forward-looking statement speaks only as of the date on which it is made. New risks and uncertainties arise over time, and it is not possible for us to predict those events or how they may affect us. Except as required by law, we are not obligated to, and do not intend to, update or revise any forward-looking statements, whether as a result of new information, future events or otherwise. 20 Table of Contents Executive Summary We are a Maryland corporation primarily focused on investing in, financing and managing mortgage-backed securities (“MBS”) and other mortgage-related assets. Our objective is to provide attractive risk-adjusted returns to our stockholders, primarily through dividends and secondarily through capital appreciation. As of June 30, 2026, we were invested in: •residential mortgage-backed securities (“RMBS”) that are guaranteed by a U.S. government agency such as the Government National Mortgage Association (“Ginnie Mae”), or a federally chartered corporation such as the Federal National Mortgage Association (“Fannie Mae” or “FNMA”) or the Federal Home Loan Mortgage Corporation (“Freddie Mac” or “FHLMC”) (collectively “Agency RMBS”); •commercial mortgage-backed securities (“CMBS”) that are guaranteed by a U.S. government agency such as Ginnie Mae or a federally chartered corporation such as Fannie Mae or Freddie Mac (collectively “Agency CMBS”); and •to-be-announced securities forward contracts (“TBAs”) to purchase Agency RMBS. During the periods presented in these condensed consolidated financial statements, we also invested in CMBS and RMBS that are not guaranteed by a U.S. government agency or a federally chartered corporation (“non-Agency CMBS” and “non-Agency RMBS”, respectively). We continuously evaluate new investment opportunities to complement our current investment portfolio by expanding our target assets and portfolio diversification. We conduct our business through our wholly-owned subsidiary, IAS Operating Partnership L.P. (the “Operating Partnership”). We are externally managed and advised by our Manager, an indirect wholly-owned subsidiary of Invesco. We have elected to be taxed as a real estate investment trust (“REIT”) for U.S. federal income tax purposes under the provisions of the Internal Revenue Code of 1986. To maintain our REIT qualification, we are generally required to distribute at least 90% of our REIT taxable income to our stockholders annually. We operate our business in a manner that permits our exclusion from the “Investment Company” definition under the 1940 Act. 21 Table of Contents Market Conditions and Impacts Macroeconomic factors that affect our business include inflation, economic growth, employment conditions, public policy, fiscal and monetary policy, interest rates, interest rate volatility, financial conditions, spread premiums, residential and commercial real estate prices, credit availability, the health of the banking system, consumer spending, personal income and corporate earnings. Of these macroeconomic factors, financial conditions, inflation, employment conditions, monetary policy, interest rates and interest rate volatility had the most direct impact on our performance and financial condition during the second quarter of 2026. Financial conditions improved during the second quarter of 2026 despite periodic bouts of volatility driven by geopolitical developments in the Middle East, elevated energy prices and shifting expectations for monetary policy. Strong labor market conditions, resilient economic growth and moderating interest rate volatility supported risk assets, while investors navigated uncertainty surrounding inflation and energy prices. Against this backdrop, equity markets generated strong returns during the quarter, with broad market indices recovering from periods of volatility and ending the quarter at or near record highs. Credit markets also performed well, as risk premiums across investment grade, high yield and securitized bonds generally tightened amid improving investor confidence and continued demand for income-oriented assets. Inflation remained notably above the Federal Reserve’s 2% target throughout the quarter. The year-over-year increase in the headline consumer price index (“CPI”) increased during the quarter, rising from approximately 3.3% in March to 3.5% by quarter end, reflecting the impact of higher energy prices and broader inflationary pressures. The year-over-year increase in core CPI, which excludes food and energy, was unchanged from the beginning of the quarter at 2.6%. Despite uncertainty around energy prices, investors revised their inflation expectations lower, most clearly reflected in Treasury inflation-protected securities breakeven rates. The two-year breakeven declined sharply to 2.00% at quarter end from 3.25% at the end of the first quarter, while the five-year breakeven decreased to 2.27% from 2.60%. The Federal Open Market Committee (“FOMC”) maintained its target range for the Federal Funds rate at 3.50% to 3.75% throughout the second quarter, citing continued economic resilience, a strong labor market and inflation that remained above its long term objective. Expectations for future monetary policy shifted meaningfully during the quarter. Investors entered the period anticipating that moderating inflation and slowing economic growth would eventually lead to policy easing. However, stronger than expected economic data, elevated energy prices and a modest reacceleration in inflation prompted market participants to reassess this outlook. By quarter end, Federal Funds futures reflected growing expectations that the FOMC's next move would be a hike rather than a cut. Interest rates increased across the U.S. Treasury yield curve during the quarter as investors reassessed the outlook for inflation and monetary policy amid resilient economic growth, a strong labor market and elevated energy prices. The two-year U.S. Treasury yield increased by 37 basis points to 4.17%, the five-year yield rose by 29 basis points to 4.23% and the ten-year yield rose by 16 basis points to 4.47%. Interest rate volatility remained relatively well contained during the quarter despite periodic bouts of market uncertainty driven by geopolitical developments in the Middle East and evolving policy expectations. Against this macroeconomic backdrop, Agency RMBS performance relative to interest rate hedges was mixed across the coupon stack. Higher coupon securities, which benefitted from improving risk sentiment, declining interest rate volatility and favorable market technicals, generally outperformed lower coupon securities. Demand from banks, asset managers, mortgage REITs and other institutional investors remained robust throughout the quarter, while net supply was readily absorbed despite elevated gross issuance activity, underscoring the sector's resilience amid elevated inflation and evolving monetary policy expectations. Attractive carry, strong investor demand and favorable relative valuations versus other high-quality fixed-income sectors continued to support investor interest in Agency RMBS throughout the period. During the quarter, Agency CMBS risk premiums remained relatively unchanged as supply was readily absorbed by continued institutional demand from banks, insurance companies and asset managers seeking high-quality spread assets. Supported by stable cash flows and attractive risk-adjusted yields relative to other spread sectors, Agency CMBS remained well positioned within the fixed income market. 22 Table of Contents Market Rates [[GREPCENT_TABLE]] [["","As of"],["","June 30, 2026","","March 31, 2026","","December 31, 2025","","September 30, 2025","","June 30, 2025","","One Quarter Change","","One Year Change"],["Interest Rates"],["Effective federal funds rate","3.62","%","","3.64","%","","3.64","%","","4.09","%","","4.33","%","","(0.02)","%","","(0.71)","%"],["One-month SOFR","3.65","%","","3.66","%","","3.69","%","","4.13","%","","4.34","%","","(0.01)","%","","(0.69)","%"],["2 Year U.S. Treasury","4.17","%","","3.80","%","","3.47","%","","3.60","%","","3.72","%","","0.37","%","","0.45","%"],["5 Year U.S. Treasury","4.23","%","","3.94","%","","3.71","%","","3.73","%","","3.79","%","","0.29","%","","0.44","%"],["10 Year U.S. Treasury","4.47","%","","4.31","%","","4.15","%","","4.15","%","","4.23","%","","0.16","%","","0.24","%"],["30 Year U.S. Treasury","4.95","%","","4.89","%","","4.83","%","","4.73","%","","4.77","%","","0.06","%","","0.18","%"]] [[/GREPCENT_TABLE]] [Excerpt truncated for page length; source filing is linked above.] ## Latest 10-K MD&A (excerpt) Latest 10-K Item 7 source: https://www.sec.gov/Archives/edgar/data/1437071/000143707126000015/ivr-20251231.htm Complete FY 2025 MD&A: /company/IVR/mda/fy2025/ Extracted structurally from real Item 7 body heading to real Item 7A/8 boundary. Published MD&A gate trimmed front/tail over-capture. Confidence: high Filing date: 2026-02-23 Report date: 2025-12-31 Item 7. Management’s Discussion and Analysis of Financial Condition and Results of Operations. The discussion and analysis disclosed herein apply to material changes in our consolidated financial statements for 2025 and 2024. For the comparison of 2024 and 2023, see the Management's Discussion and Analysis of Financial Condition and Results of Operations in Part II, Item 7 of our 2024 Annual Report on Form 10-K, filed with the SEC on February 20, 2025. The following discussion should be read in conjunction with our consolidated financial statements and the accompanying notes to our consolidated financial statements, which are included in Part IV, Item 15 of this Report. Overview We are a Maryland corporation primarily focused on investing in, financing and managing MBS and other mortgage-related assets. Our objective is to provide attractive risk-adjusted returns to our stockholders, primarily through dividends and secondarily through capital appreciation. Factors Impacting Our Operating Results Our operating results can be affected by a number of factors and primarily depend on the level of our net interest income and the market value of our assets. Our net interest income, which includes the amortization of purchase premiums and accretion of purchase discounts, varies primarily as a result of changes in market interest rates and prepayment speeds, as measured by the constant prepayment rate (“CPR”) on our assets. Interest rates and prepayment speeds vary according to the type of investment, conditions in the financial markets, competition and other factors, none of which can be predicted with any certainty. The market value of our assets can be impacted by spreads and the supply of, and demand for, assets in which we invest. Market Conditions and Impacts Macroeconomic factors that affect our business include inflation, economic growth, employment conditions, public policy, fiscal and monetary policy, interest rates, interest rate volatility, financial conditions, spread premiums, residential and commercial real estate prices, credit availability, the health of the banking system, consumer spending, personal income and [[GREPCENT_TABLE]] [["","40"]] [[/GREPCENT_TABLE]] Table of Contents corporate earnings. Of these macroeconomic factors, financial conditions, inflation, employment conditions, monetary policy, interest rates and interest rate volatility had the most direct impact on our performance and financial condition during 2025. Financial conditions ended 2025 slightly improved, falling sharply after elevated uncertainty around U.S. trade policy in April before rebounding over the remainder of the year. Conditions remained accommodative in the fourth quarter as the Federal Open Market Committee (“FOMC”) reduced rates twice, volatility measures remained subdued and equity markets performed well. During the fourth quarter, the S&P 500 Index and the NASDAQ continued their strong performance, posting gains of 2.3% and 2.6%, respectively. For 2025, the S&P 500 gained 16.4% and the NASDAQ was up 20.4%. Credit market valuations improved over the course of 2025 and ended the fourth quarter largely unchanged, despite experiencing a period of notable deterioration driven primarily by uncertainty regarding U.S. trade policy. Inflation readings trended modestly lower during 2025 but continued to exceed the Federal Reserve’s 2% target. The headline consumer price index (“CPI”) ended the year at 2.7%, down from 2.9% in December 2024. Core CPI (CPI excluding food and energy) declined from 3.2% to 2.6%. The disinflationary trend was also evident in the fourth quarter, as headline CPI decreased from 3.0% to 2.7% and core CPI declined modestly from 3.0% to 2.6%. Investors responded to the improved inflation readings by lowering expectations for future inflation, most directly reflected in Treasury inflation-protected securities breakeven rates. The two-year breakeven ended the year at 2.30% (down from 2.63% at the end of September and 2.54% in December 2024) and the five-year breakeven ended at 2.27% (down from 2.45% in September and 2.39% last December). The labor market weakened in 2025, as the economy added 181,000 jobs compared to 1.5 million jobs in 2024. This weakening trend continued during the fourth quarter, as the economy lost 51,000 jobs. Despite inflation remaining above the Federal Reserve’s 2% target, the FOMC responded to the weakening job market by lowering its benchmark Federal Funds target rate by 25 basis points on three occasions during 2025, including at both meetings in the fourth quarter. By year-end, Federal Funds futures priced in expectations for an additional 50 basis points of rate cuts by the end of 2026, reflecting investor anticipation of a more accommodative Federal Reserve moving forward. The FOMC ended its program of quantitative tightening during the fourth quarter after reducing its portfolio of U.S. Treasury securities and Agency MBS by over $2.2 trillion since June 2022. Interest rates declined across the U.S. Treasury yield curve in 2025, reflecting market expectations for a more accommodative monetary policy stance and continued weakness in the labor market. The two-year U.S. Treasury security yield fell 78 basis points to 3.47%, the five-year yield declined 68 basis points to 3.71% and the ten-year yield decreased by 43 basis points to 4.15%. Interest rates were little changed during the fourth quarter, as the yield on two-year U.S. Treasury securities decreased by 13 basis points, while the yields on five- and ten-year U.S. Treasury securities fell by two basis points and remained unchanged, respectively. Despite increasing significantly in April after the U.S. trade policy announcements, interest rate volatility declined notably throughout the remainder of the year. This decline reflected market expectations for an accommodative Federal Reserve, which were confirmed when the FOMC lowered its benchmark rate by 25 basis points at each of the last three meetings of 2025. Against this macroeconomic backdrop, Agency RMBS delivered robust performance during the fourth quarter, capping an exceptional year for the sector. Relative to U.S. Treasury securities, 2025 marked the strongest calendar-year performance for Agency RMBS since 2010, which is particularly notable given the ongoing runoff in Agency RMBS from the Federal Reserve’s balance sheet and the continued lack of meaningful demand from commercial banks. Three key themes emerged in the second half of the year that supported valuations following the sector’s underperformance amid April’s trade policy-related instability: a sharp decline in interest rate volatility, significant inflows into fixed income funds and mortgage REITs, and the unexpected emergence of Fannie Mae and Freddie Mac as additional sources of demand. With organic net supply totaling just $164 billion for the year, money manager, mortgage REIT and GSE demand drove higher valuations. As a result, the sector outperformed investment grade corporates relative to U.S. Treasury securities for the first time since 2018. Prepayment speeds increased modestly but remained low, constrained by subdued housing activity and mortgage rates that, despite falling nearly 100 basis points over the year, remain elevated. Premiums on higher coupon specified pool collateral were well supported by the decline in mortgage rates, improving notably in the second half of the year. Agency CMBS risk premiums finished 2025 largely unchanged, retracing the spread widening seen in April amid heightened U.S. trade policy uncertainties. The rebound in valuations began in mid-to-late April and continued through the fourth quarter, supported by improving clarity in trade relations and growing confidence in the path toward monetary policy easing. Additionally, slightly higher issuance levels relative to the prior year were well absorbed due to money manager inflows and continued bank demand for stable cash flow profiles. [[GREPCENT_TABLE]] [["","41"]] [[/GREPCENT_TABLE]] Table of Contents Market Rates [[GREPCENT_TABLE]] [["","As of"],["","December 31, 2025","","September 30, 2025","","June 30, 2025","","March 31, 2025","","December 31, 2024","","","","One Quarter Change","","One Year Change"],["Interest Rates"],["Effective federal funds rate","3.64","%","","4.09","%","","4.33","%","","4.33","%","","4.33","%","","","","(0.45)","%","","(0.69)","%"],["One-month SOFR","3.69","%","","4.13","%","","4.34","%","","4.32","%","","4.33","%","","","","(0.44)","%","","(0.64)","%"],["2 year U.S. Treasury","3.47","%","","3.60","%","","3.72","%","","3.91","%","","4.25","%","","","","(0.13)","%","","(0.78)","%"],["5 year U.S. Treasury","3.71","%","","3.73","%","","3.79","%","","3.98","%","","4.39","%","","","","(0.02)","%","","(0.68)","%"],["10 year U.S. Treasury","4.15","%","","4.15","%","","4.23","%","","4.24","%","","4.58","%","","","","\u2014","%","","(0.43)","%"],["30 year U.S. Treasury","4.83","%","","4.73","%","","4.77","%","","4.61","%","","4.78","%","","","","0.10","%","","0.05","%"]] [[/GREPCENT_TABLE]] [[GREPCENT_TABLE]] [["","As of"],["(in basis points)","December 31, 2025","","September 30, 2025","","June 30, 2025","","March 31, 2025","","December 31, 2024","","","","One Quarter Change","","One Year Change"],["Swap Spreads (1)"],["2 year","(16)","","(22)","","(23)","","(17)","","(16)","","","","6","","\u2014"],["5 year","(26)","","(35)","","(37)","","(31)","","(34)","","","","9","","8"],["10 year","(37)","","(49)","","(54)","","(45)","","(50)","","","","12","","13"],["30 year","(68)","","(80)","","(87)","","(79)","","(85)","","","","12","","17"],["30 Year Mortgage Spreads vs. 5/10 Year U.S. Treasury Securities Blend (2)"],["FNMA 2.0%","83","","82","","90","","75","","65","","","","1","","18"],["FNMA 2.5%","87","","88","","95","","83","","74","","","","(1)","","13"],["FNMA 3.0%","81","","88","","96","","86","","77","","","","(7)","","4"],["FNMA 3.5%","70","","87","","98","","87","","78","","","","(17)","","(8)"],["FNMA 4.0%","80","","89","","100","","88","","76","","","","(9)","","4"],["FNMA 4.5%","92","","100","","114","","105","","91","","","","(8)","","1"],["FNMA 5.0%","110","","119","","130","","122","","108","","","","(9)","","2"],["FNMA 5.5%","111","","135","","149","","142","","126","","","","(24)","","(15)"],["FNMA 6.0%","93","","124","","161","","147","","140","","","","(31)","","(47)"],["FNMA 6.5%","47","","100","","127","","116","","135","","","","(53)","","(88)"],["10 Year Agency CMBS Spreads vs. U.S. Treasury Securities (3)"],["FHLMC K","37","","37","","42","","45","","41","","","","\u2014","","(4)"],["FNMA DUS","46","","44","","47","","49","","47","","","","2","","(1)"]] [[/GREPCENT_TABLE]] (1)Swap spreads represent the difference between the fixed rate coupon of an interest rate swap and the yield on a U.S. Treasury security with a similar maturity. (2)Mortgage spreads represent the difference between the yield on the Agency TBA and the blended average yield of five year and ten year U.S. Treasury securities. (3)Agency CMBS spreads represent the difference between the yields on new issue Freddie Mac K Certificates and Fannie Mae Delegated Underwriting and Servicing MBS (“DUS”) and a U.S. Treasury security with a similar maturity. Outlook Given the meaningful decline in interest rate volatility, we remain constructive on Agency RMBS, though we view near-term risks as balanced following the sector's strong performance, reinforced by the recent announcements that Fannie Mae and Freddie Mac will purchase $200 billion in Agency RMBS. In addition, Agency CMBS continues to offer attractive risk-adjusted yields and diversification benefits given its stable cash flow profile and lower sensitivity to interest rate fluctuations. [[GREPCENT_TABLE]] [["","42"]] [[/GREPCENT_TABLE]] Table of Contents Longer term, the environment for Agency MBS investments is likely to remain favorable given reduced interest rate volatility and expectati [Excerpt truncated for page length; the complete text is on the linked full-MD&A page.] Read the full FY 2025 MD&A: /company/IVR/mda/fy2025/ All MD&A years: /company/IVR/mda/ ## MD&A history Prior-year 10-K MD&A spans are extracted from SEC filings with the same bounded parser used for the latest filing. Each year's full verbatim text is on its own sub-page. - [FY 2024 MD&A](/company/IVR/mda/fy2024/): filed 2025-02-20; accession 0001437071-25-000007 (https://www.sec.gov/Archives/edgar/data/1437071/000143707125000007/ivr-20241231.htm) - [FY 2023 MD&A](/company/IVR/mda/fy2023/): filed 2024-02-22; accession 0001437071-24-000005 (https://www.sec.gov/Archives/edgar/data/1437071/000143707124000005/ivr-20231231.htm) - [FY 2022 MD&A](/company/IVR/mda/fy2022/): filed 2023-02-21; accession 0001437071-23-000006 (https://www.sec.gov/Archives/edgar/data/1437071/000143707123000006/ivr-20221231.htm) - [FY 2021 MD&A](/company/IVR/mda/fy2021/): filed 2022-02-17; accession 0001437071-22-000007 (https://www.sec.gov/Archives/edgar/data/1437071/000143707122000007/ivr-20211231.htm) ## Macro cross-references Indicators mapped to this company's SIC classification (industry 6798 Real Estate Investment Trusts) by grepcent's deterministic macro-sector crosswalk. A navigational mapping, not a statistical or causal claim. - [DGS10](/indicator/DGS10/): Market Yield on U.S. Treasury Securities at 10-Year Constant Maturity - [HOUST](/indicator/HOUST/): New Privately-Owned Housing Units Started: Total Units - [PERMIT](/indicator/PERMIT/): New Privately-Owned Housing Units Authorized in Permit-Issuing Places: Total Units - [FEDFUNDS](/indicator/FEDFUNDS/): Federal Funds Effective Rate Macro-to-micro threads including this sector: [Interest rates & the Fed](/thread/interest-rates-fed/), [Money & trade](/thread/money-trade/), [Government finances](/thread/government-finances/), [Sector employment](/thread/sector-employment/). All macro indicators: /indicators/ ## For LLMs & downloads Markdown twin: /company/IVR.md · JSON record: /company/IVR.json · verified financials: /company/IVR/financials.json / /company/IVR/financials.csv · machine TOC for the whole site: /llms.txt