Angel Oak Mortgage REIT reported a third-quarter GAAP net loss as higher interest rates weighed on portfolio values. The mortgage investor also posted positive distributable earnings, bought $233 million of residential loans and home equity lines, and declared a $0.32-per-share dividend.
The quarter’s results show a contrast between operating earnings and reported book value: distributable earnings were positive, while GAAP book value and economic book value both fell from the second quarter.
Key details
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Net loss and interest income: Angel Oak recorded a GAAP net loss of $16.7 million, or $0.72 per diluted share. Net interest income was $10.2 million for the quarter. The company also cited a 55-basis-point year-over-year increase in its quarterly net-interest-income comparison. For the first nine months of 2026, net interest income totaled $33.1 million, up 9.5% from the same period in 2025.
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Distributable earnings: The company reported $6.4 million of distributable earnings, or $0.28 per diluted share, for the quarter. This is a separate measure from GAAP net income.
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Book value declined: GAAP book value was $8.97 per share at September 30, down 11.5% from the end of the second quarter. Economic book value was $11.45 per share, down 6.5% over the same period.
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Dividend declared: Angel Oak declared a common-stock dividend of $0.32 per share, payable November 30 to shareholders of record November 23. The declared dividend is four cents higher than the quarter’s distributable earnings per share.
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Loan purchases: The company bought $233 million of newly originated, current-coupon non-qualified mortgage loans and home equity lines of credit. The loans had a weighted-average coupon of 7.29%, a weighted-average combined loan-to-value ratio of 69.8%, and a weighted-average credit score of 758, excluding zero scores.
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Portfolio coupon: The weighted-average coupon on Angel Oak’s residential whole-loan portfolio was 7.21% at quarter-end, 17 basis points below its level at the end of 2025.
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Financing capacity: Angel Oak had four loan financing lines that together permitted up to $1.3 billion in borrowings. About $255 million was drawn, leaving roughly $1 billion of capacity for new loan purchases.
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Securitizations and market conditions: Chief Executive Sreeni Prabhu said the company completed two securitizations early in the quarter, before most of the increase in interest rates. He said higher rates had put near-term pressure on portfolio valuations and on potential returns from new investments. The company said it continued to deploy capital selectively and maintain its underwriting standards.
What the figures show
The decline in both book-value measures reflects pressure on portfolio valuations, while positive distributable earnings indicate the company generated earnings under that measure during the quarter. The announced dividend exceeds quarterly distributable earnings per share, although the figures alone do not establish how the dividend compares with earnings over a longer period.