Armour Residential Reit, Inc. · NYSE:ARR

Armour Residential Reit — Investor Presentation (March 2011)

18 slides from Armour Residential Reit's investor presentation, Mar 10, 2011

  1. Slide 1: ARMOUR Residential REIT

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  2. Slide 2: Important Regulatory and Yield Estimate Risk Disclosures

    PLEASE READ: Important Regulatory and Yield Estimate Risk Disclosures Certain statements made in this presentation regarding ARMOUR Residential REIT, Inc. (“ARMOUR” or the “Company”), and any other statements regarding ARMOUR’s future expectations, beliefs, goals or prospects constitute forward-look

  3. Slide 3: ARMOUR REIT Capitalization as of March 8, 2011

    ARMOUR REIT Cai ation as of March 8, 2011 * 32,254,054 shares of common stock outstanding (NYSE/Amex: “ARR”). * Market Cap — $240.62 million. * Book Value — Historic Book Value estimate: $7.12 per share or $229.65 mill — Current Book Value estimate: $6.87 per share or $221.59 million nm. * Warrants

  4. Slide 4: Portfolio and Balance Sheet Highlights

    ARMOUR REIT Portfolio and Balance Sheet Highlights * Agency mortgage portfolio valued at $2.22 billion"), — 503 separate CUSIPs. — Weighted average market value per CUSIP: $4.4 million. Median market value per CUSIP: $2.0 million * Gross asset duration estimate of 3.26. * Net balance sheet duration

  5. Slide 5: Dividend

    ARMOUR REIT Dividend: * ARMOUR declares dividends based on estimates of future taxable REIT 2600 income. * Q2 2011 Monthly Dividends ~ ARMOUR will pay second quarter 2011 monthly dividends of $0.12 per month. ~ The shareholder record date is the 15th of each month, payable on the second to last busi

  6. Slide 6: Investment Strategy Review

    ARMOUR REIT Investment Strategy Review Investment Methodology Review Portfolio Composition Portfolio & Liability Valuation and Duration Detail Portfolio Constant Prepayment Rates (CPR) REPO Composition

  7. Slide 7: Balance Sheet Targets, Strategy, and Governance Review

    ARMOUR Residenti Balance Sheet [i Targets ‘ Portfolio Strategy Transparency and Governance I REIT, | ets, Strategy, and Governance Review By charter, ARMOUR only invests in Agency assets. Net balance sheet weighted average duration target of 1.5 or less. Hedge asset and funding rate risk on approxim

  8. Slide 8: Investment Methodology

    ARMOUR Investment Methodology Management has a very focused and disciplined approach to evaluating assets for inclusion in the ARMOUR portfolio. + Agency Only Securities * Loan analysis ~ By Charter the fund can only invest in Agency = Onginalisarbalancadide Securities. . — Year of origination. + Lo

  9. Slide 9: Agency Asset Class Composition

    ARMOUR REIT Agency Asset Class Composi ans 15 Yeor & 5.2% seasoned Pass- Throushs 29.5% Agency Asset Class ‘Current Value ARMS (0-18 Months to Reset) (2) $ 114739,723 Ibid sononnesesungrtoneess) ——«§ 1258672886, 1DearPaseThaughs 0) $ ssa eee ‘Low Loan Balance 15 Year Pass-Throughs (s) $ 102,841,845

  10. Slide 10: ARM and Hybrid Composition

    ARMOUR REIT ARM and Hybr 85-120MTR 0-18MTR 3.0% 8.1% 19-36MTR 10.4% Weighted Average [Months to eset Curent Value 61-84MTR ‘MonthstoReset 32.0% 048 $ 116739723 e 1938 3 187,686.32 3 3748 3 30253457 4s 4960 355035600 2 37-48 MTR eres 5 452500535 % ‘ dae 85.120 5 azsia.ssi 12 Total $1,413,412,608 ss 4

  11. Slide 11: Agency Type Composition

    ARMOUR REIT Agency Type Compos ARM & Hybrid Composition Fixed Composition reise se Ginnie Mae 189% oa Ginnie Mae 273% Freddie Mac 10% Fannie Mae 10% Percentage of Total ‘Agency Type Current Value x Fannie Mae $ 1,536,619,284 69.3% Freddie Mac 295,157,166 133% Ginnie Mae 386,038,602 17.4% Total $ 2,2

  12. Slide 12: Portfolio and Liability Valuation and Duration Detail

    ARMOUR REIT Portfolio and Estimated Effective Weighted Average Weighted Average Weighted Average ‘Agency Asset Class ae sea me ct Gee Duration Using Current Values ARMS 108.6% 108.9% 3.66 125 Hybrids 104.0% 103.5% 391 297 10Year Pass-Throughs 102.7% 102.5% 3.62 374 ‘Low Loan Balance 15 Year Pass-Thr

  13. Slide 13: Eurodollar Futures Detail

    ARMOUR REIT EuroDollar Futures Detai Eurodollar Futures to os Weighted aa Replicate Swaps ‘Average Rate 2Year Swap $ 18,000,000 0.87% 175 3YearSwap $ 54,000,000 152% 270 4Year Swap 5 64,000,000 2.05% 3.60 5 YearSwap $ 20,000,000 2.16% 475 Total or Weighted Average $ 156,000,000 1.76% 32 Information

  14. Slide 14: Interest Rate Swap Detail

    ARMOUR REIT Interest Rate Swap Detail — ar a = see Ss = os cet oem ee = as Ge es a say Gee ee ie es county Neto =o oon cece 2 see Boe tee eee cs sas =e gee soe eee see = fees a So ees ey iscon@mo ayo ays Ls eon ‘Nomura 140,000,000 oa oe gee | Boos a = ass = ao ne Ge Ge oa 2 ee ee Se ee aR = oe ce ee

  15. Slide 15: Portfolio Constant Prepayment Rates (CPR)

    ARMOUR REIT Portfolio Constant Prepayment Rates (CPR) Monthly Portfolio March2011 Constant Prepayment Rate ‘Agency Asset Class CPR Sf RPEPEE SPELL E, fe + ARMOUR expenses premium amortization sit occurs. + Constant Prepayment Rate (CPR) isthe annualized equWvalent of single monthly mortality (SMM).

  16. Slide 16: Portfolio Constant Prepayment Rates (CPR)

    ARMOUR REIT Portfolio Constant Prepayment Rates (CPR) March 2011 Constant Prepayment Rates sy 232 » + ARMs & Hybrids Fixed Rates s+ 433 wo + ARMOUR expenses premium amortization asit 89 ” + constant Prepayment Rate (CPR) sthe annualized equivatentofsingle monthly mortally (SMI). cPR a - =— Stlemptst

  17. Slide 17: REPO Composition

    ARMOUR REIT REPO Composition — srocemnen rnin Sly, Magninene See = — “ee : " Fer (= = : : ee : cooper [oe g s E — (ee 2 : S.. i; fe & z Z lk : : =a Clk SC ; : Se, i eS i 4 aoe i an : : Total or Weighted Average $ 2,088, 744,180 100.0% 2 iain —ie Se FebruaryPaydowns $ (30,676,361) Total REPO afterPay

  18. Slide 18: ARMOUR Residential REIT contact

    ARMOUR RESIDENTIAL REIT www.armourreit.com ARMOUR Residential REIT, Inc. 3001 Ocean Drive Suite 201 Vero Beach, FL 32963 772-617-4340

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