everyone. Thank you, David. morning, Good
Fed’s with made stability. the rate reduction. price of and sheet the Progress with unchanged balance third the well During Fed, meeting September telegraphed a slow to in employment and full mandate and policy quarter, dual steady kept federal funds respect maintained monetary the of its to normalization continues their interest be commencement path of the
points the mortgages spread of Due realized to rates to of sheet nominal XX series of X%, X their inflation performance As transitory response reinvestment softened year during has around removal a benchmark basis unemployment plan, the by spreads in some best the remains uncertainty to balance to quarter. factors. the below with however, tightening recently Fed’s agency
with changed of rate a December, expectation minimally Fed room market cycle. policy basis the an XX benign rate we tightening with into we points Our Accordingly, a normalization for which current At point, in of for running interest the expect range is see potential largely for out of year remains bound increases more rate XXXX. in end. this and outlook two further
Chairperson expect We replace future. Janet Yellen will who learn to in the near the as Federal Reserve of very
we of securitized mortgage credit over for demand to the period offer two quarter coupled remained While tightening this it that against a was the a well yield markets Spreads rate supported calendar, outlook heavy economic years. geopolitical continued Attributes near which have by three may position most altering RMBS spread rhetoric which products for materially of several driven and see severe has ABS to brief exposure impacted fundamentals. credit. or in strong structured products market credit healthy Spreads attractive and volatility, and of asset-backed areas started do our either medium-term. been during the new-issue has not for high hurricanes, by stable
in homeowner heavy varying the spread degrees arrival during sectors GSE and the of the on credit enjoy CRT traded volatility. the While space. credit bouts the quarter, damage broader with sector of Hurricanes Harvey but of of markets, insurance experienced unknowns with sector line deviated transfer had risk coverage, most The tightening extent and pressure but Irma, of hurt the then
in carrying. Fundamental mezzanine benign became loss borrower residential with roughly to more mortgages damage unchanged. collateral feared home appreciation that industry of MITT of continued continues the understood, quarter recovery that better ended steady tranches ultimately benefiting as remain resulting from came and owns initially pricing. credit However, out performance a the forecast research The price
seen lending extremely rise where time. since Additionally, standards affordability. to on of constructive do it think home remained asset collateral We and have underwriting which we materially is economic both the prices this and fundamental remain interest that higher residential believe believe hamper will to unlike interest at incomes, crisis. we performance. is rising in would higher stability be growth housing mortgage price expectations that durable of and any other We of supportive not rates rates conservative note housing many points material important loosen home We classes has think
open expect see credit mortgage margins. up do to begin that backdrop, to we Given the
strong As signs housing under the relaxing show new of is and fundamentals environment regulatory the post-crisis, the for time first administration. starting remain to
on Focusing activity. outlined the of third we our presentation, earnings Slide quarter quarterly X
As capital the investments. TBA our David of backdrop generated mentioned of sector. the equity credit $XX.X we actively net for rotated million investing earlier, offset portfolio MBS, agency current into of from and MBS million by sales into cash rotation of favorable net $XX.X from credit The flow agency agency supports into equity positions
well new we obtained opportunities credit the more as issue we On niche finding Angelo, as are side, in both the that platform. through Gordon the market
book our ownership is the investment as currently retention portion loans Additionally, through a our On updated interest residential of to over Slide laid for well team the MITT, willingness term across best in aggregate value credit ROEs previously structure. invest investment X, value newer on value rate important prior securitization time portfolio of in that fair loans quarter. subordinated We relative from quarter. we cost, out as the fixed where of ABS agency portfolio the The approximately the investment of the a opportunity was risk to the agency, Angelo, $X.X see exposure July, evaluates lower other approximately with the the along our to our capital Slide during shows billion set, in Gordon tranches fair constantly and refinanced non-performing credit, vertical and in we lies maintained to It sectors. note long-term of The whole participated sectors and $X.X mortgage have ability composition value which securitized increased and financing. our hypothetical funds, shareholders. of the into X book in billion. billion was term these billion commercial each varies for our $X.X fair the our $X.X approximately
at liquidity the new powder $XXX liquidity portfolio ample go in Brian later giving call. detail us dry had in investments. for Additionally, the our quarter end million through will more of
agency constant the book current by breakout portfolio for our was XX, quarter. you of rate type. on for agency a on see Slide third our The X.X% prepayment will our exposure product Focusing
Given the of agency relative agency on portfolio our be overall able favorable overall be universe the is and agency Because to our selective prepayment generally to this, size book of we for holdings. expect collateral into adding to and the exhibit than our the greater investment to team slower fees market, the risk portfolio. the owing of of disciplined stability characteristics
our Slide modestly the this agency The to XX portfolio, addition we the modest have X.XX the ahead due years MBS. to the lay years quarter of was versus quarter Moving quarter. decline earnings in duration declined we to during increased X.XX of presentation, gap the as to out exposure prior which of hedges our quarterly
returns. opportunities in less underwriting the well-positioned to is agency we we is a investment close The look range currently sectors, team quarter. to credit hope the residential advantage forward, fourth MITT CRE favorable of opportunities larger and in wide believe and which As we take credit of at liquid several
results. liquid We turn also agency mortgages find to call financial that, into such With investments the more investments. to sectors credit continue Brian that other in over avoid attractive as our we and capital review residential to I