financials outlook market up Serena the the quarter thanks businesses followed then us discuss the our for I'll today. landscape, an for fourth a and performance and opening review our joining will Q&A. morning, on for by you, call everyone, of Good XXXX. our macro discuss Thank Sean. begin with our and before current brief update then environment portfolio
a are throughout exhibited as mid-October basis in rallying all in before XXX fixed fourth in point November XX-year the considerable as and quarter, volatility treasury peaking range, X% markets trading aware, at Now evidenced by the income December.
as mortgage half volatility prove beneficial implied the declined. quarter The to of assets second
economic the and which $X.XX outearned take dividend spreads were leverage, and environment, for return agency well with these per X.X economic steepened declined curve of yield XX.X% of tightened the achieved with positioned turns to for quarter. And We we lower at share. to we this quarter, distribution of a advantage modestly The the results available end meaningfully. earnings our delivering
And we disciplined have year management. pleased XXXX, a economic of a finance characterized in risk risk year on value the as housing by events. the unforeseen portfolio numerous reflect that and we believe to are our return We performance diversified our and generated on demonstrates model our X%
the in higher The to decline are turning the the Federal income strong macro the suggesting Now more away for beneficial moving around largely balanced. around driver to monetary narrative, policy primary longer from express fixed the since communications, comfort began the a inflation, attributed that be to shift environment. of risks can Reserve's in demand November for outlook
policy Powell's is likely evidenced inflation to policymakers ensure XXXX, balance future that as discussions tools. policy the the independent March noting in highlighted also upcoming sheet continues recent moderate. as of as while tapering meeting, Powell sheet statements, are long occur. and that Normalization balance occur And actually declaring by yet, can potential landing the in not will to soft a victory just in Chair to keen begin rates as
with And the liquidity be regard to we're system. existing and a in its Fed ample, signaling while conditions appears sheet financing the that financial balance encouraged remain to approach conservative
cash taking treasury record longer-term dynamics advantage decline exerting as market fourth yields on of the of pressure in amount to a yield second chose debt in issuance is incremental the less yields. Now quarter of funds, factor supply the in the the front issue to leading change the in money while end the in curve,
at rate with strong remains the unemployment still exhibiting and X.X% Now economy the strength. broader domestic GDP consumers QX spending X.X%, at
Inflation, X.X% from towards months. benefit the year-over-year base meanwhile, effects measures to coming meaningfully a moderated bring should and absent in PCE core shock has
looking of HPA the lock-in below continued existing unwilling Now sector, despite at expectations reaching resulting borrowers, market's couple rates years inventory mortgage who effect, last or housing trade from highs. has low XX-year rates to mortgage benefit home move the market homeowners as available-for-sale over to the prices experiencing current in struck outperformed are up.
scenario. told, the landing subdued, with the market and we're sector Housing modest seen should mortgage housing remain and recent in in the soft And consumer following we constructive line although uptick have the demand the activity rates. decline an on signs in of labor remains all resilient
Now our of the at the the lower the Much shifting for us in the in pools. and rotated quarter, prepared spread well experienced widening very coupons of outset higher normalized, occurred and the we with coupon volatility progressed. portfolio as left and to agency of sector. market out and October beginning And as subsided spreads volatility our agency specified reduction TBAs which
protected selection of prepaid which our represented vast higher specified stories our pool in securities, purchases. favoring disciplined coupon remain We of majority high-quality the
high-yielding, complementary addition, attractive with In tighter Fixed increasing as opportunistically convexity lag it as flow Agency Agency size to portfolio market the in spreads to sector move portfolio billion $X.X minimal cash and by agency exposure. did rate the MBS in stable holdings provides Agency $X.X billion our grew is we asset value. the a CMBS CMBS locking our a in
overall dedicated Our resi of quarter of the XX% late out MSR agency in quarter. agency reallocated at in our the equity XX% quarter end, down we and credit as favor of represented further strategy prior from
to rate adjustment we very front was One during relates it half quarter. make in spreads helped swaps SOFR first balanced the our the year-end. at As the particularly of curve level the of did futures experienced of tactically, into the yield the elevated treasury from however, experienced we liability position rotated from the tight swap end given hedges, our protect volatility us
shock positioned as tables. overall, rate XXX% conservatively to and And our exposure it ratio as we remain through rate relates our seen hedge
more to distribution the monetary neutral has near However, XXXX begin decline point, pivot in Fed's duration path we in the volatility. reach future in And has resulted which changing a rate comfortable may of as implied portfolio a of policy, the we landscape, given future. the to we'll more the narrowed policy a adding where with feel begin
spreads, coincident risk income low. support improving clarity, likely and been to rate to inflows demand. help should historically deposits, along are a catalyst in In factors, remains materialize midyear, as which, funds. see technical fixed these regulatory incremental should attractive alternatives, relative relatively historically We'll QT end while at we fixed have prepayment furthermore, for approach bank convexity earlier market MBS which income in the cuts And an stabilize particularly with with
credit and The sector in the tighter XX non-Agency broader points the investment-grade the XX market. basis sentiment to AAA points turning tighter end on with participated income quarter-over-quarter. fixed basis CRT, below spreads, Now year non-QM risk residential to
was we The in and Our whole correspondent portfolio channel. XX% of be acquisitions loans position of capital. resi retained continue the of at $X.X loan billion account assets. billion $X.X portfolio comprises attributed the strategy. the billion and whole securitization our QX in the portfolio loan Onslow ended whole can year firm's OBX in portfolio and And based now year-over-year to sourced total as settled Residential acquisition for strong half currently resi value, which loan through organic directly to roughly be market XX% the $X.X up growth in our
$X.X our winter the And Lock billion, these for a volume billion OBX fourth beginning subsequent returns, demonstrated in fourth In projected we of the $X.X seasonals. quarter-over-quarter transactions leverage. generated X by securitizations of end since was quarter, credit mid-teens $X.X end, million correspondent securitized recourse at X and assets XX% priced utilizing quarter was transactions with quarter modest and $XXX increase the characteristics despite a CLTV. XXX inclusive of quarter billion, that strong FICO as robust pipeline XX% to
continues non-bank overall as remain Bay residential a in leader over the Onslow years. the X largest credit be securitizer past largest and to the we market second
we control lowest credit AAA preferred have XXXX And rates tightest issue executed delinquency manufacture to volume. across sell to the the us non-QM also partners, diligence, addition, maintaining over our assets pricing, the option we investment just new credit, issuers. And correspondent bond and while residential XX note, our our channel year-to-date. remains largest organically able within were to in allowing In
Now shifting to MSR.
XX portfolio by market purchase value MSR December to through XX% servicing portfolio, top of inclusive packages in settling $XXX of at in of a nearly XX% end throughout Bay rights. And in million nonbank value the X addition the Onslow or forward fourth in increased $X.X market quarter bulk Our making trades owner modest our increased flow billion to XXXX acquisitions.
largest buyer this commentary, and modestly MSR with given consistent saw $XX historically balance previous to throughout QX favor lack collateral continue the we the stable exhibiting capitalize to rate, had principal and onboarding low cash market billion note with bulk we market, capping significant year. $XXX in record low balance in quarter-over-quarter, and an The highly quality speeds. the principal billion trade. prepayment high incentive, able flows And on credit our transactions fifth that active XXXX the portfolio refinance is supply, were Annaly was over up in a of the
MBS a December with selectively our positioning add The MSR portfolio than expand to we've we've of and partnerships, our been in preferred flow a of universe. of market. had while to particular, scale MSR we which in MSR segment the new past preferred begun X-month unique of of no our And certainty and partner the relationships approximately purchasing as CPR market our originators through able capital, still collateral this to rate XX% establish lower as the footprint. And light quarter. low In have sourcing started X.X%
to more relationships of flow a these supply. expect We add source predictable
year, strategy. Now desire we to market minimal this continue looking And to warehouse be capacity, moderate MSR MSR elevated to ample with anticipate continue positioned and to may we well active from sales levels. ahead, to capital leverage this to add a allocate XXXX's be the those
and handing Serena, we're of note to before on risks we that as market turbulence to off vigilant evolves. the up Now additional cognizant horizon, I prepared operating always, wrap and environment the the for wanted as remain to
we will profile and ready to improving optimistic outlook X earnings continue take skilled remain of strong where returns capital most businesses, liquidity, leverage, strategies we believe complementary accretive. with each to a should rate with respect environments. interest we're stability fully our and we different that substantial And superior said, macro opportunities, be our provide our risk-adjusted for to Annaly's X That of advantage and shareholders believe across
the that, hand to Serena And now with over to it I'll discuss financials.
