Invesco Mortgage Capital Inc. announced on April 30 its financial results for the quarter ended March 31, 2026.
The company reported that market conditions were challenging during the first quarter of 2026, following a strong recovery in Agency mortgage-backed securities valuations in late 2025. Kevin Collins, incoming Chief Executive Officer, said, “During the first quarter of 2026, we operated in a more challenging market environment following the strong recovery in Agency MBS valuations experienced in the second half of 2025. Financial conditions deteriorated as rising geopolitical tensions, higher energy prices and renewed inflation concerns drove increased interest rate volatility and pushed U.S. Treasury yields higher across the curve. These dynamics weighed on risk assets broadly and resulted in higher coupon Agency RMBS underperformance relative to Treasuries.” Collins also noted that although Agency commercial mortgage-backed securities performed well during the period, these gains were offset by increased risk premiums and tightening swap spreads.
The company’s book value declined by 7.3% to $8.08 at quarter end; when combined with monthly dividends paid out over the period, this resulted in an economic return of negative 3.2%. The economic debt-to-equity ratio rose to 7.5 times from seven times at year-end due to a lower book value per share and what Collins described as “a more constructive outlook on Agency RMBS as we enter the second quarter.” At quarter end, Invesco Mortgage Capital held $7.3 billion in investments: $5.2 billion was allocated to Agency RMBS, $1.2 billion to Agency TBA positions, and $0.9 billion to Agency CMBS.
Collins added that risk sentiment had improved entering April due to reduced interest rate volatility: “A further de‑escalation of the Middle East conflict would likely provide additional support for risk assets… Together, these macro and technical factors create a more constructive backdrop for our Agency RMBS holdings… In addition, despite elevated supply, our Agency CMBS continues to offer attractive risk‑adjusted yields and diversification benefits.” The company declared common stock dividends totaling $0.36 per share for shareholders during this period along with preferred stock dividends; it also issued nearly fifteen million shares through its at-the-market program raising net proceeds of $133 million while repurchasing some preferred shares valued at about $1.6 million.
Invesco Mortgage Capital is structured as a real estate investment trust focused mainly on mortgage-backed securities and related assets; it is managed externally by Invesco Advisers Inc., which is part of global investment manager Invesco Ltd., according to information provided by the company.
An earnings call will be held May 1 at 9:00 a.m., with presentation slides available online for interested parties.
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