Dynex Capital, Inc. · NYSE:DX
Dynex Capital — Q2 2025 Earnings Presentation
29 slides from Dynex Capital's earnings presentation, Jul 21, 2025
Slide 1: Second Quarter 2025 Earnings Presentation
Second Quarter 2025 Earnings Presentation July 21, 2025 1
Slide 2: Safe Harbor Statement
Safe Harbor Statement NOTE: This presentation contains certain statements that are not historical facts and that constitute “forward-looking statements” within the meaning of the Private Securities Litigation Reform Act of 1995. Statements in this presentation addressing expectations, assumptions, b
Slide 3: Dynex delivers attractive, consistent, monthly returns
Dynex Capital delivers attractive, consistent, monthly returns over the long term through disciplined risk management, strategic asset selection and active management of a portfolio of real estate mortgage assets. 3 3
Slide 4: Dynex's Strategy Delivers Strong Returns
Dynex’s Strategy Delivers Strong Returns We employ a global, top-down macroeconomic approach that informs our disciplined risk management – driving and protecting investor value across market cycles. This process involves: Macroeconomic Insight – A global view and Preparation for Decision Making – D
Slide 5: A Leading Mortgage Investor Delivering Consistent, Monthly Dividends
A Leading Mortgage Investor Delivering PERFORMANCE AT A GLANCE Consistent, Monthly Dividends $14.2B Portfolio Fair Value $1.5B Market Cap What we do today 465.6%Stock return 16.7% Annualized since IPO Dividend Yield (dividends reinvested) We generate dividend income and long-term total returns throu
Slide 6: Dynex Delivering Industry-Leading Returns for Past Five Years
Dynex Delivering Industry-Leading Returns for Past Five Years Cumulative Total Shareholder Returns Owner-operated structure 52.0% and high-performance culture 48.1% have resulted in reliable returns that have consistently outperformed the S&P 500 31.5% Financials and the REM (iShares Mortgage RE ETF
Slide 7: Second Quarter 2025 Performance
Second Quarter 2025 Performance 7
Slide 8: Quarterly Performance Highlights
Quarterly Performance Highlights Q2 25 Q1 25 Average Earning Assets $11.4B $10.3B (inclusive of Agency RMBS TBAs) Book Value $11.95 $12.56 (per common share) Leverage (2) 8.3x 7.4x Total Economic Return (1) (0.8)% 2.6% Comprehensive Income (Loss) $(0.11) $0.16 (per common share) (1) Equals sum of di
Slide 9: Well-Positioned for Residential Mortgage Rebound
Well-Positioned for Residential Mortgage Rebound (as of dates indicated) June 30, 2025 March 31, 2025 Portfolio Fair Value $14.2 Billion Portfolio Fair Value $11.1 Billion Dynex’s diversified Agency RMBS TBA (1) 70% Agency RMBS TBA (1) 73% portfolio remains Agency RMBS Pools Agency RMBS Pools Agency
Slide 10: Selected Components of Portfolio Returns (excluding mark-to-market)
Selected Components of Portfolio Returns (excluding mark-to-market) (1) (2) Interest Income Hedge Benefit-Tax Basis $150.0 $100.0 $111.7 Interest income $75.0 $95.1 ($s in millions) $s in millions) $100.0 $88.5 $83.5 continues to $76.1 $50.0 increase as higher $50.0 $25.0 $25.5 $26.7 $22.0 $24.9 $25
Slide 11: Key Macroeconomic Themes
Key Macroeconomic Themes Dynex remains 01 Global Power Shifts 04 Fed Policy vigilant and Shifting geopolitical dynamics impact global capital flows and the demand for U.S. Treasuries and agency The Fed’s posture on its policy rate and balance sheet runoff (QT), including MBS, has a direct and materi
Slide 12: Spreads remain attractive for private capital
Spreads remain attractive for private capital Private capital Private capital dominates Growth in GSE retained portfolios Fed Quantitative Easing returning 12
Slide 13: Agency RMBS Market Dynamics and Portfolio Strategy
Agency RMBS Market Dynamics and Portfolio Strategy Agency MBS Fundamentals: Technicals: offer compelling • • Steeper Curve - positive for mortgage carry, including dollar rolls Focused Refis – refi response likely very high for • Fed Balance Sheet - Fed MBS runoff continues ("quantitative tightening
Slide 14: CMBS Market Dynamics and Strategy
CMBS Market Dynamics and Strategy Stable Agency Fundamentals: Technicals: CMBS offer • Multifamily (MF) – demographic demand for housing is strong, driving tight markets for MF. High • Issuance - non-agency CMBS issuance has rebounded due to increases in single asset / borrower transactions prices a
Slide 15: Hedging Dynamics
Hedging Dynamics Focus on Fundamentals: Technicals: generating • Swap Yields – lower than Treasury yields by 20-100bps, offering potential to earn more spread • Futures vs. Cash UST & Swaps - UST futures are some of the deepest, most liquid markets in world, income on assets relative to hedges. trad
Slide 16: Funding Market Dynamics and Strategy
Funding Market Dynamics and Strategy Funding Fundamentals: Technicals: • Evolving Economic Data – expect to take • Money Market Funds - $7.07T in assets, inflows of availability advantage of fluctuations in pricing of Fed rate moves amid periodic volatility in economic data. $220B in 2025, underscor
Slide 17: Dynex Positioned to Generate Income and Drive Value
Dynex Positioned to Generate Income and Drive Value 01 Income Opportunity 04 Policy We expect to create Mortgage spreads widened in 2Q and held near generational wides versus swaps, and Lighter regulation improves financing and allows for more investment in RMBS. The Fed will likely value through op
Slide 18: Our Core Values Guide Us
Our Core Values Guide Us These values keep us grounded – and allow us to sustain our high-performance culture while consistently generating attractive, long-term returns. We Deliver Value We Build Trust We are unwavering in our commitment to deliver lasting We earn trust by acting with integrity, fo
Slide 19: Supplemental Financials
wy DYNEX 7 XN CAPITAL INC. Supplemental Financials
Slide 20: Capital Structure
Capital Structure Common Stock Series C Preferred Stock NYSE Ticker DX DX PRC Shares Outstanding 125.4 million 4.5 million Book Value per share Outstanding $11.95 — Second Quarter 2025 Dividends Declared per share $0.51 $0.62 Annualized Dividend Yield 16.7% 9.8% Share Price $12.22 $25.51 Market Capi
Slide 21: RMBS Portfolio Details (as of June 30, 2025)
RMBS Portfolio Details (as of June 30, 2025) Unamortized Par/Notional Amortized Fair Value % of Total WAVG Pay Premium 3-month 3-month ($ in thousands) Value Cost (%) (2) Fair Value (%) Portfolio up to TBA (2) Balance (2) Market Yield (3) WAVG Yield (2) CPR (2) (4) Agency RMBS Pools(1): 2.0% coupon
Slide 22: CMBS and CMBS IO Portfolio Details (as of June 30, 2025)
CMBS and CMBS IO Portfolio Details (as of June 30, 2025) Portfolio Characteristics Financing Details 3-month Amortized % of Total WAVG Life WAVG WAVG Repo Equity ($ in thousands) Cost Fair Value Portfolio Remaining (1) Yield Market Yield (2) Outstanding Invested Agency CMBS $ 470,882 $ 472,426 3.3 %
Slide 23: Risk Position - Interest Rate and Spread Sensitivity
Risk Position - Interest Rate and Spread Sensitivity Interest Rate Sensitivity to Instantaneous Shocks Percentage Change in Percentage Change in Common Shareholders’ Equity Curve Shift Common Shareholders’ Equity Parallel Curve Shift As of As of (bps) June 30, 2025 March 31, 2025 2 year 10 year Trea
Slide 24: Hedge Position Changes
Hedge Position Changes June 30, 2025 March 31, 2025 Notional Notional Amount / WAVG Fixed Amount / WAVG Fixed Our hedge strategy is ($ in thousands) Long (Short) Pay Rate Long (Short) Pay Rate constructed to 30-year U.S. Treasury futures $ (953,500) n/a $ (766,500) n/a protect and optimize 10-year U
Slide 25: Funding Strategy (as of June 30, 2025)
Funding Strategy (as of June 30, 2025) Fair Value of MBS Balance Weighted Pledged as Collateral Collateral Type ($s in thousands) Average Rate ($s in thousands) Agency RMBS $8,236,132 4.46 % $8,679,237 Balancing and Agency CMBS 275,298 4.48 % 290,138 Diversifying Risk Agency CMBS IO 84,326 4.82 % 92
Slide 26: Comprehensive Income
Comprehensive Income June 30, 2025 March 31, 2025 Income Per Common Income Per Common ($ in thousands, except per share amounts) (Expense) Share* (Expense) Share* Interest income $ 111,746 $ 0.99 $ 95,059 $ 1.05 Interest expense (88,618) (0.78) (77,926) (0.86) Net interest Income 23,128 0.20 17,133
Slide 27: Book Value Rollforward - Quarter Ended June 30, 2025
Book Value Rollforward - Quarter Ended June 30, 2025 Common Equity Common equity, beginning of period (1) $ 1,284,415 Net interest income $ 23,128 Net periodic interest from interest rate swaps 12,349 Operating expenses (12,293) Preferred stock dividends (2,680) Changes in fair value: MBS and loans
Slide 28: Reconciliation of GAAP Measures to Non-GAAP Measures
Reconciliation of GAAP Measures to Non-GAAP Measures (1) ($ in thousands except per share amounts) 2Q25 1Q25 4Q24 3Q24 2Q24 Comprehensive income (loss) to common shareholders $ (12,222) $ 14,391 $ 12,562 $ 70,741 $ (12,013) Adjustments: Change in fair value of investments (2) (37,716) (129,387) 259,
Slide 29: 4991 Lake Brook Drive, Glen Allen, Virginia
4991 Lake Brook Drive, Suite 100 Glen Allen, Virginia 23060 804-217-5800 dynexcapital.com 29