Slide 1: March 2011
March 2011
Slide 2: Forward Looking Statements
Forward Looking Statements FINANCIAL, INC. ‘When used in this presentation or other written or oral communications, statements which are not historical in nature, including those containing words such as “believe,” “expect,” “anticipate,” “estimate,” “plan,” “continue,” “intend,” “should,” “may” or
Slide 3: MFA is positioned with the requisite expertise to benefit from investment in MBS
MFA is positioned with the requisite expertise to benefit from investment in Agency and Non-Agency Residential MBS
Slide 4: First Quarter 2011 Financial Highlights
First Quarter 2011 Financial Highlights > Net income per conumon share of $0.27 and Core Earnings* per share of $0.25. > We currently project that approximately 60% of our second quarter 2011 Core Earnings will be generated by Non-Agency MBS. > Re-securitization completed February 17, 2011. > We ant
Slide 5: February 2011 Re-securitization
FINANCIAL, INC. February 2011 Re-securitization >MFA completed a $1.32 billion re-securitization in February. >$488.4 million of the AAA rated bonds issued to third party investors at 1Mo LIBOR + 100 bps by CSMC Series 2011-IR (the “Trust”) >$831.6 million face amount of three classes of non-rated s
Slide 6: Experienced Management Team Focused on Residential MBS Opportunities
FINANCIAL, INC. Experienced Management Team Focused on Residential MBS Opportunities > Non-Agency MBS remain available at significant discounts to par value. > Agency MBS continue to benefit from a steep yield curve. > Our goal remains to generate double-digit ROEs with appropriate levels of leverag
Slide 7: 16.2% Annual Return Since January 2000
Fina 16.2% Annual Return Since January 2000 500 400 300 200 [ 100 = -100 Dec-99 Dec-00 Dec-01 Dec-02 Dec-03 Dec-04 Dec-05 Dec-06 Dec-07 Dec-08 Dec-09 Dec-10 SEP &P Fin] Source: Bloomberg 7 “Includes reinvestment of dividends through March 3.
Slide 8: MFA Asset Allocation Strategy
MFA Asset Allocation Strategy FINANCIAL, INC. Investment in Residential MBS Including Both Agency MBS and Non-Agency MBS Non-Agency At March 31, 2011 Agency MBS MBs " Cash Other, net Total (Sin Millions) Amortized Cost s 72 $ s 664 S 25) ry 11211 ‘Market Value s 7375 «$3,608 S$ 604 S 25) $ 11,622 Le
Slide 9: MFA Asset Allocation Strategy
MFA Asset Allocation Strate FINANCIAL, INC. ng Both Agency MBS and Non-Agency MBS (Sin Millions) Agency Non-Agency ® Total Average Average Average Time to Reset Market Value__ MTR® Market Value MTR® Market Value _ MTR® <2 years® S 1,888 8 S$ 1777 6 S$ 3.665 7 2-5 years 3.057 44 455 4l 3.511 44 > 5 y
Slide 10: MFA Strategy — Agency MBS
MFA Strategy — Agency MBS FINANCIAL, INC. MFA continues to selectively acquire Agency MBS » The majority of our assets will continue to be whole- pool Agency MBS due to the attractiveness of the asset class. » The yield curve remains steep and incremental spreads on Agency MBS remain attractive. > T
Slide 11: MFA Strategy — Non-Agency MBS
MFA Strategy — Non-Agency MBS FINANCIAL, INC. > MFA owns $3.6 billion market value of Non-Agency MBS. These Non- Agency MBS have an average amortized cost of 73% of par. > In the First Quarter of 2011, these assets generated a loss adjusted yield of 8.26% on an unlevered basis. > These high yielding
Slide 12: MFA Strategy — Non-Agency MBS
MFA Strategy — Non-Agency MBS FINANCIAL, Ne y discounted purchase price, substantial credit reserve and 6.7% credit enhancement mitigate credit ris ‘Non-Agency Portfolio As of March 31, 2011* Current Face $4,593.58 orm a ee $46.0 Dollars in Millions * Inciudes $406:4 million fer value of Non-Agency
Slide 13: MFA is positioned with the requisite expertise to benefit from investment in MBS
MFA is positioned with the requisite expertise to benefit from investment in Agency and Non-Agency Residential MBS
Slide 14: MFA Financial, Inc.
MFA FINANCIAL, INC.