Seeking Alpha
We cover over 5K calls/quarter
Profile| Send Message| ()  

Executives

Mark S. Collinson - Partner

Michael R. Hough - Chairman and Chief Executive Officer

Kenneth A. Steele - Chief Financial Officer, Principal Accounting Officer, Treasurer and Secretary

Benjamin M. Hough - President, Chief Operating Officer and Director

William H. Gibbs - Co-Chief Investment Officer and Executive Vice President

Analysts

Steven C. Delaney - JMP Securities LLC, Research Division

Michael R. Widner - Keefe, Bruyette, & Woods, Inc., Research Division

Stephen Laws - Deutsche Bank AG, Research Division

Arren Cyganovich - Evercore Partners Inc., Research Division

Joel Jerome Houck - Wells Fargo Securities, LLC, Research Division

Daniel Furtado - Jefferies & Company, Inc., Research Division

Michael P. Taiano - Telsey Advisory Group LLC

Jason Arnold - RBC Capital Markets, LLC, Research Division

Douglas Harter - Crédit Suisse AG, Research Division

Hatteras Financial Corp (HTS) Q1 2013 Earnings Call April 24, 2013 10:00 AM ET

Operator

Good morning, and welcome to the Hatteras Financial First Quarter Conference Call. [Operator Instructions] Please note this event is being recorded.

I would now like to turn the conference over to Mark Collinson, CCG. Please go ahead.

Mark S. Collinson

Thank you, Joseph. Good morning, everyone, and welcome to the Hatteras First Quarter Earnings Conference Call. With me today, as usual, are the company's Chairman and CEO Michael Hough; COO, Ben Hough; and CFO, Ken Steele. Also available to answer your question are the company's co-Chief Investment Officers, Bill Gibbs and Fred Boos.

Briefly from me before I hand over to them, I need to remind you all that any forward-looking statements made during today's call are subject to risks and uncertainties, which are discussed at length in our annual and quarterly SEC filings. Actual events and results can differ materially from these forward-looking statements.

The content of this conference call also contains time-sensitive information that's accurate only as of today, April 24, 2013, and the company undertakes no obligations to make any revisions to these statements or to update these statements to reflect events or circumstances occurring after this conference call.

That's all for me. Here's Michael Hough.

Michael R. Hough

Okay. Thanks, Mark. Good morning. We will be brief with our remarks today. The entire team is here and happy to discuss anything surrounding the Hatteras business during Q&A.

This week we'll celebrate our fifth year as a public company. While at times there have been bumps, it's clearly been a great opportunity to provide some really nice value to our shareholders. That is what we're trying to do, of course. But if you think about it, 5 good years in the falling rate market does not equate to a complete success. We are now charged with providing value for the next 5 years, which we'll have to do by both sticking to what we know is right and by being flexible and adaptive.

Surely mortgage finance is going to be different 5 years from now, and we'll have had to adapt to staying focused on immediate and potential risks will be the most important driver for future success. So I'm bullish on how well we're positioned for the next 5 years, and on our ability to create shareholder value and provide capital for home ownership.

Our success will ultimately be dependent on risk management and doing what's in the best long-term interest of the company and the shareholders. Looking back 5 years from now, I expect I'll again say it was bumpy. But we're confident in our ability to manage Hatteras appropriately, and continue to be a valuable long-term investment partner.

And with that, I'll hand this to Ken to summarize the financials.

Kenneth A. Steele

Thanks, Michael. Good morning, everyone. In general, our results on a core basis were pretty stable quarter-over-quarter, which was the theme for the overall markets as well. Investors keep looking for chinks in the armor of QE3, but not really finding yet has kept volatility down.

Our net income for the quarter was $61.8 million, or $0.62 per weighted average share as compared to $101.3 million or $1.02 per weighted average share for the fourth quarter of 2012. Major difference was the decrease in gains on sales of assets, which dropped from $39 million in the prior quarter to $2.5 million in this quarter.

Our net interest income was $71.4 million in the first quarter of 2013 as compared to $74.7 million in the previous quarter. This was largely a function of a smaller average portfolio, as average earning assets went from $25.8 billion in the fourth quarter of 2012 to $24.1 billion for the first quarter of 2013.

In general, all of our earnings metrics improved slightly, as our yield went from 2.04% to 2.06%, which was an increase of 2 basis points. Our cost of funds fell 1 basis point to 95 basis points, and our spread, therefore, increased to 111 basis points. Amortization expense decreased, going from $50.1 million in the fourth quarter of 2012 to $43.2 million in the first quarter of 2013. This was due both to a smaller portfolio and a slowing of repayments.

Our weighted average one-month CPR dropped from a rate of 19.8 in the last quarter of 2012 to 19 in the first quarter of this year. Our total operating expenses were $6.7 million, which is an annualized rate of 88 basis points on average equity for the quarter.

Book value was essentially unchanged at $28.18, which contains $0.30 of undistributed earnings. Our liquidity position was strong, with $2 billion of cash and securities unencumbered at quarter end.

With that, I will turn the call over to Ben for details regarding portfolio and investment.

Benjamin M. Hough

Thanks, Ken. The first quarter was a steady one for us but relatively uneventful. As you know, we are usually defensive against higher rates and given the bonds sell off in the steepening curve during the quarter, we are well-positioned to start the year.

Our slighter -- our slightly lighter leverage beginning January 1, along with our short duration portfolio, helped protect equity and book value. Stability and equity, at times of volatility, allows us to manage our leverage more effectively and thus maintain earnings power. This will always remain a focus of ours even when rate volatility appears unlikely in the near term. Even though quarter-end leverage was flat compared to the fourth quarter at 7.4, average earnings assets were lower by about $1.7 billion due to the timing of settlements of purchases and sales.

Runoff was replaced by mostly new production, hybrid 7 ones and 15-year fixed at blended current yields estimated at around 180 to 190. While our leverage has remained a bit lower over the last few quarters, it's not necessarily our target range and it's possible we could see some value and take that up a little.

Now looking at repayments. CPR has eased somewhat late in Q1, as expected. We have been in the steady range of around 19 to 21 CPR for well over a year, and for Q1, we were at the bottom of that range at 19 even. Monthly, they came in at 20.1 in January, 19.3 in February and then 17.6 in March, so it was a steady decline.

In April, we printed an 18.5 CPR, and given the rally and rates since quarter end, we expect prepayments may move back into the 19 to 21 CPR range over the next month or so.

We continue to mitigate prepayments where we can by buying pool selectively. And also, just like the last few quarters, we sold about $132 million of seasoned ARMs that we thought might underperform, which resulted in a small gain. But given the steeper curve and slightly lower prepay risk during the quarter, there were only a few securities that we felt needed to be sold.

Going forward, prepay expectations and collateral performance will drive our decision-making on whether or not we sell securities.

On hedging, we added $600 million in new interest rate swaps, as well as the swap equivalent of $200 million in Eurodollar future contracts in the first quarter, pulling out an average of about 4.5 years at around 90 basis points. All of these are forward starting later this year and next year against some of our upcoming swap maturities, which average about 1.9%. So new swaps are gradually coming on at about 100 basis points lower than where they exist currently over the next 2 years.

With this recent move back lowering rates, hedging opportunities remains favorable and we will continue to look to replace future runoffs before they mature. This quarter end, we have added another $200 million in swaps for similar terms.

On repo, we have seen some release since year-end, with average rates coming off by about 7 to 8 basis points, into the high 30 basis point range. The rate curve for repo is very flat right now between 1 and 6 months, allowing for some good longer-term opportunities. For now, we expect repo rates to remain fairly steady at these levels, maybe decline a little bit, sometime mid-year.

And as far new investment levels go, we're presently looking at 7 ones and may be some 15-year with current yields in the 170 to 210 range, depending on the asset mix, and around 50 to 70 basis points on the cost of fund side after hedging. So net interest margins for incremental capital are roughly 125 basis points on average.

With that, I'll turn it back over to Michael.

Michael R. Hough

Okay, that's all we have for remarks. So we're happy to answer any questions.

Question-and-Answer Session

Operator

[Operator Instructions] Our first question comes from Steve Delaney with JMP Securities.

Steven C. Delaney - JMP Securities LLC, Research Division

So Ben commented, I would ask Ken about this very small $50,000 gain on futures. Ben mentioned the Euro futures contracts. So that's something new you're doing as far as an alternative on swapping?

Benjamin M. Hough

Yes. I think, Steve, we're looking at as the markets are changing due to regulation in banks. We're examining some possibilities to see what's more efficient for us. So we put on a couple of trades to mimic some swaps. And we're going to kind of compare those and see which performs better. There certainly could be some beneficial other parts to the doing the Eurodollars.

Steven C. Delaney - JMP Securities LLC, Research Division

And Ken, is it just a quirk in GAAP that you've showed those as realized gains in the income statement as opposed to some kind of unrealized mark?

Kenneth A. Steele

Yes, you can get hedge accounting on them, but it's pretty difficult, and particularly where the short as we do this test run. We're just kind of going to see what happens here.

Steven C. Delaney - JMP Securities LLC, Research Division

I guess the only other thing I had, your book value held up really well. We thought it was pretty good, but we were maybe looking for down 1%, so congratulations on that, cause there was a lot of volatility. And I think we're going to see some numbers that are going to be down, down pretty good from some of your peers. At least at March 31, certainly bounced back here in April. I was just curious if you could give us any color about, so far in the second quarter, how hybrid market values have held up. Are they cheaper? Are they richer? Just any color you could you give us on the hybrid market would be appreciated.

William H. Gibbs

Yes, Steve. This is Bill. If you take a look at what's happened since the end of the first quarter, I'd say, probably on the short end, like looking at newer issue, 5 ones, we're up about a quarter of a point. As you move about 7 [ph] ones, it's probably up in the neighborhood of, let's call it 3/8 of a point for our current production. As far as how it looks on the relative value basis, from the Z spread basis, to treasury, it's fairly close. There hasn't been a great deal of change. So it's fairly close in terms of valuation compared to the end of the quarter.

Operator

Our next question comes from Mike Widner with KBW.

Michael R. Widner - Keefe, Bruyette, & Woods, Inc., Research Division

Just following up on one of Steve's questions there on the Eurodollar futures. Are those included in the swaps table, at all? Or are they just a separate item that's not there and we should add that separately?

Kenneth A. Steele

They are not in the swaps table. We talked -- gave a little bit more disclosure about it in the Q where we listed out, but basically its equivalent of $200 million notional, with about, probably from here about a 4-year term at about a 1.04 rate.

Michael R. Widner - Keefe, Bruyette, & Woods, Inc., Research Division

Great. And I guess I'm just wondering if you could address the broad topic of dividend policy. And obviously, you've been -- you got a $0.70 dividend. Core earnings power in the last 2 quarters has been pretty consistent from kind of what you guys are talking about in the current environment. Not getting a whole lot of optimism that, that's going to change markedly. So just wondering if you could talk about that and how you view the dividend going forward?

Michael R. Hough

This is Michael. We obviously paid another $0.70 dividend and with $0.62 of earnings this quarter which, I think, we were pretty clear last quarter on what we were doing and trying to do, and we're carrying over some of the fourth quarter gains into this year. We entered first quarter with a significantly lower earnings position that we had in the fourth quarter, which was somewhat impactful, and our dividend policy really is trying to distribute a dividend that's reflective of the earnings power of our portfolio. So I think that's where we are today, and $0.70 is consistent with that.

Michael R. Widner - Keefe, Bruyette, & Woods, Inc., Research Division

So -- I'm sorry if I'm not entirely catching the drift there. But I mean, if I look at your net interest spreads that you're reporting and add in kind of what you're talking about, CPR is not exactly trending significantly lower, and no real guidance at the moment that you're going to take leverage up higher. I guess I'm just having some difficulty translating core earnings power into something closer to $0.70 than $0.60. And I guess, am I missing something there?

Michael R. Hough

Well, I think there are obviously multiple variables. We haven't got it of CPRs higher or lower. Frankly, we've been extremely consistent over the past couple of years that way. So we don't really expect that to change much. And with slightly higher bond position, that's -- that's a key driver to this, as well as the shape of the curve. So we're not guiding on dividends going forward, other than to say that, that we are distributing what we think is appropriate given the portfolio and earnings power we expect to have.

Operator

Our next question comes from Stephen Laws from Deutsche Bank.

Stephen Laws - Deutsche Bank AG, Research Division

Two -- maybe 2 macro or larger picture questions. The first, recent articles talking about potential risk, or not risk, but significant growth among the mortgage REITs. And maybe any thoughts you have on that, given some of the companies are getting significantly -- a significant size -- although I think as a total the market mortgage REITs probably still only hold about 6% of the CMBS. And then secondly, just any bigger picture thoughts on the said line [ph] program and how that winds down, and any potential impact it might have on the repo markets if any of those securities were put out for repo.

Michael R. Hough

Okay Steve, thanks. I'll take the first question here. Yes, there has been some comments recently, even Bernanke, maybe Dudley and Governor Stein have all commented on mortgage rates. And you're right, mortgage rates represent approximately $400 billion of agency MBS. And out of the $5 trillion to $6 trillion market. So it's not a huge part of this, but I think what we would expect would be -- some mention maybe in the FSOC annual report as one of the many potential risks to the market, and the tri-party -- along the tri-party repo in the repo market. So I think, while there has been meaningful growth in mortgage REITs. We are, you've heard many times we provide a very valuable function in the overall housing market, and I think that's very important. So I feel pretty confident that Hatteras, in particular, with our relatively consistent and easily evaluated strategy is in a pretty good place, as far as the Fed [ph] could possibly be concerned. As far as the Fed buying program. Ben?

Benjamin M. Hough

Yes, I guess the QE removal, QE3 removal, we don't think the Fed is going to pull back on their $40 billion plus per month purchases this year, and likely, maybe not even next year. Perhaps, late '14. As far as the longer-term removal of QE3, it's been gleaned from recent Fed comments that Fed officials have mentioned the possibility of delaying asset sales, selling assets only at a very slow pace, and being very visible and communicative in their process. So our view there is that we may not see the Fed selling these assets for many years to come. I think I read one piece, they were talking about 2024, perhaps when MBS comes off, but eventually. Now as far as repo goes, I think obviously with the Fed, if the Fed and when the Fed pulls back on its purchases, it's not going to be as impactful to the repo market. The repo market levels are driven by collateral and cash demand and supply, dealer balance sheets and size constraints, bill and note options of late, and I guess lastly, the migration of dealer short-term funding positions towards the term funding positions, and that's all have been the premiums on term repo. So we don't see a direct link to when the Fed begins to pull back and sell, either sell or likely hold onto their bonds that they're purchasing. And therefore, we don't see that as very impactful to near term repo markets, or repo market rate levels, I should say.

Operator

Our next question comes from Arren Cyganovich from Evercore.

Arren Cyganovich - Evercore Partners Inc., Research Division

With the spread widening a bit on the 30-years comparative to 15 in some of the ARMs, can you remind us, why you tend to choose not to go into that asset class, and how you see relative value in, I guess, shorter duration assets that you invest in?

Michael R. Hough

Yes, Arren, it's -- I think, we've been very clear about how we look at this business. And this is the business of risk management and a business of long-term sustainability of a business through interest rate cycles. And we've had -- here we are at trough in rates that may go on, it may go on longer, who knows, but in our view this is absolutely the wrong time for us or any levered investor to take more risk. And I think we've -- trying to be clear that we're airing on the side of taking less risk. So ARMs had been -- we've had a lot of experience with ARMs through multiple complete rate cycles, and we're very comfortable with how they've performed. We, in previous lives we've had experienced with longer at the curve, and it just doesn't, just doesn't work out well in our experience as the market changes. So we're committed to being on the short end of the yield curve, and we will -- it is purely from a risk management perspective and we will continue to work on protecting equity of this company at all cost through multiple or through changing rate environments.

Benjamin M. Hough

And Arren, this is Ben, I'd like to add that while we're not active in the forward markets and the TBA fixed markets, we've always, since 1998, bought our ARMs forward to keep dollar price low. And we get some of that benefit, automatically, always have, and that is something we've always done and We're not interested in distributing the trough equity that we produced.

Arren Cyganovich - Evercore Partners Inc., Research Division

That's helpful. And then lastly, the premium amortization decline was, I guess, more pronounced than the slowdown in CPR. You mentioned that the assets fell which helped drive that. Was there anything else in terms of the mix of prepays, of something that would explain the difference there?

Michael R. Hough

Not really. I mean, you have some of that each quarter as certain things with a higher dollar prices speed up or slow down, but the vast, biggest part of it was just those 2 factors.

Operator

Our next question comes from Joel Houck with Wells Fargo.

Joel Jerome Houck - Wells Fargo Securities, LLC, Research Division

Just kind of going back to your opening comments, Michael, about the last 5 years being favorable. I think, obviously everyone on the call recognizes that the last 5 years have been very favorable for agency REITs. I'm curious as to what you view as the biggest challenge is for Hatteras' business model, particularly the hybrid strategy in the next 5 years. And also on the flip side, if you were able to look out and kind of kick an optimal rate environment or the macro scenario for the next 5 years, what would it look like?

Michael R. Hough

Well, the biggest challenge to any levered fixed income fund is going to be rising rates. And from where we are today, I would think that would ultimately be the challenge. And that's not necessarily rising repo rates, but a steepening of the curve in a meaningful way, et cetera. So that's what I would think that we and everyone else, and banks, REITs, et cetera, have to be most on guard for. And that has always been the case. We have the experience. We have the scars. We know what the impact can be from a rising rate market. So that is why we keep harping on this and why we do it the way we do it. So from an optimal market standpoint, I mean, it would be great to have another 5 years like we've just had. But I think ultimately, for a steep yield curve, on average over time we need volatility in the market and we will need rates to go back up, and that will create additional opportunities for all fixed income investment.

Joel Jerome Houck - Wells Fargo Securities, LLC, Research Division

Do you think that -- I appreciate those comments, that in a gradual rising rate environment that you'll be able to protect book value in a reasonable basis? And thereby, kind of reinvest at higher spread. I mean, who knows what it mean, steeping environment implies to me that asset yields are probably going up more than repo cost. But I mean, how does -- when you look at strategy, particularly the exposure to a hybrid sector as a gradual environment one which you could perform like that?

Michael R. Hough

Yes, I think so. I think it's, protecting equity is the most important part of this business, and it's, it's how you protect -- first and foremost, the shareholders' investment, but second, the ability to earn in the future. And if you don't do that, your earnings capacity gets eroded very quickly. So in a gradual rise, I think absolutely, we would be able to protect equity. That's why we're set up the way we are because that is our biggest risk. Once the steepening has happened, or has begun to happen, or rates have started to go up, it's too late. We can't go out and say, okay, now we want a $25 billion ARM portfolio. So we have to continue to be -- to run this company with that in mind, against that eventuality. We can continue to make money. As long as we can protect your investment and operate through the whole cycle, I think we're doing our job.

Operator

Our next question comes from for Furtado, Daniel with Jefferies.

Daniel Furtado - Jefferies & Company, Inc., Research Division

I have a couple of questions around hedging. The first is simply, how should we think about the timing of the swap rolloff here in 2013? I know you have some higher cost swaps, should be amortized, or rolling off here. If you can provide some guidance there, that will be helpful.

Benjamin M. Hough

Dan, this is Ben. We have -- we have a table on the release that shows some of those buckets, but this year, going forward from here, we have like 600 coming due and they're probably going to average right a little over 2%. They're spread out gradually among the last 3 quarters of this year, for the most part. And then next year, there -- we have $2.4 billion coming off next year, that average rate of 1.76. Now those, over the course of that next year, they're weighted a little more in the back end of the year than in the front end of the year, but they're laddered throughout the quarters, but probably more than half of them in the second half of 2014.

Michael P. Taiano - Telsey Advisory Group LLC

Great. And then you mentioned, or someone had mentioned earlier about other beneficial reasons surrounding Eurodollars, or at least in this kind of, your testing of the Eurodollars. Do you mind indicating what those other beneficial reasons are as compared to swaps?

Benjamin M. Hough

Sure. I mean, there's a couple of different ones. I mean, certainly, there's better margin requirement in general for them. They're also much more liquid. So you can access the markets through adjusting easier. You also have the benefit of their pricing. It's much clearer pricing on it as well.

Michael R. Hough

Dan, we've been preparing for Dodd-Frank and the new margin and clearing requirements for swaps. And we just kind of stepped back and took a look at the hedging strategy into the potential impact on liquidity, going forward. And which is, from a liquidity standpoint, as Ken would say, and it's just Eurodollars could be more beneficial. There'll be less margin defer, or we won't have to participate as we would have with swaps. So it's just something we want to look at. It may be that ultimately, we end up doing everything in the Eurodollar future or we'd end up doing nothing. But it's something that we're going to keep moving forward with.

Daniel Furtado - Jefferies & Company, Inc., Research Division

Great, I appreciate that color. And then my final question is simply, when you think about your hedging strategy going forward, and I know it's not entirely proper to think about hedge ratio, but is part of the playbook that as you sense either a QE3 taper on the horizon or a higher tenure that you'll look to take for lack of a better term here, the hedge ratio higher? Or do you feel that the culmination of your assets being on the shorter end in your current hedge portfolio is sufficient if, for instance, tomorrow we were to wake up and the 10-year was 50 or 70 basis points higher.

Michael R. Hough

Well it's going to depend on how we determine the best position, the duration, and duration GAAP and interest rate exposure of the balance sheet. And that, right now, we have been pretty clear that we want to have somewhat neutral to slightly negative net duration to where we are now. But at some point, I'm sure we're going to want significantly more negative duration. And, but that's going to depend on when and how our portfolio shortens very quickly in a market like this. And we've been trying to add duration here over the last 18 months or so. That's been the challenge, because we want the duration on the liability side as well. So you're right, it's not a ratio thing or a percentage thing, it's a net balance sheet duration target that we're after.

Operator

Our next question comes from Jason Arnold with RBC Capital Markets.

Jason Arnold - RBC Capital Markets, LLC, Research Division

Thanks for the color on the prepayments on a monthly basis. I guess I was just curious if you could kind of comment on your view for prepays here as the year kind of persists, I mean, I know we've got a bit of an uptick that you might be expecting, but it seems like with burnout, in particular, we might see prepays kind of trend lower as the year progresses. So I'm just curious about your thoughts there.

Michael R. Hough

Yes, I think as Ben mentioned a little bit earlier. I think it would be safe to assume that we're looking for, right around the ranges we've been running in. First quarter was probably a little bit low, as we have the back up in rates and it's slowed down the prepays a little bit. But I think in the high teens to maybe 20, 21 CPR, is what we expect for the near term, especially with the latest drop down in rates with a little bit of a pickup there with the mortgage REIT refined index. As the year progresses, I think that we'll still probably be range bound, assuming that we won't see a spike one way or the other, in terms of that sort of levels. So I think we feel fairly comfortable in saying somewhere between that 18 to 22 range.

Kenneth A. Steele

And as we look at the trend over the quarter, how they quickly they came down. It wasn't dramatic, but going between January to March, went from 20 to 17.5. That's pretty quick move and it shows the sensitivity of the CPR. So if we get to a steeper curve or if we have stayed in that range, it would have been, it would have slowed down quite a bit and that's eventually what will happen if rates ever do go up.

Michael R. Hough

One other point we should continue to point -- to make and that is the -- we're very selective in the types of ARMs that we buy. We do buy a lot of TBAs, but we are very cognizant of the originators, the vintages, the third-party originator percentage, the loan sizes and the ARM product types when we do purchase ARMs. So all of these factors and drivers of what we select in terms of pools, contribute to that stability and speed going forward. That's our view.

Operator

[Operator Instructions] Our next question comes from Douglas Harter from Crédit Suisse.

Douglas Harter - Crédit Suisse AG, Research Division

Can you talk about where you are in the process of adding balance sheet duration? Do you see much more 15s coming on?

Michael R. Hough

It's just going to depend. We -- I think you're seeing a our portfolio that has 15% or 16% of in 15s, but we weren't there this past quarter. It's possible that we take it up, and it will be a duration decision. But right now, it's not something that we have an absolute target.

Douglas Harter - Crédit Suisse AG, Research Division

Got it. So I guess when you're looking at 15s versus some longer dated hybrids, which do you see, on a hedge basis, as being more attractive today?

Michael R. Hough

Longer dated hybrid, you mean the 7 ones?

Douglas Harter - Crédit Suisse AG, Research Division

Yes, 7 ones. Yes.

Michael R. Hough

Right now, we're looking at the 7 ones on an after hedge basis look a little bit more attractive to us currently. With the recent runoff in 15 years, I think during the first quarter, we saw prices go from mid-103s to mid-104s with Fannie 2.5. Currently, the 7 ones look a little more attractive to us.

Michael R. Hough

And one more point. 7 ones, if you look at durations today, 7 one and a 15 and make that comparison relative to any yield pickup you may have, but most important to us is what's the duration going to be 3 years from now, or 4 years from now. And that is a big factor in our decision process.

Operator

I'm showing no further questions. This concludes our question-and-answer session. I will now like to turn the conference over to Michael Hough for any closing remarks.

Michael R. Hough

Thanks for your interest, and appreciate all the questions, and we look forward to the next quarter's call. Have a great day.

Operator

The conference has now concluded. Thank you for attending today's presentation. You may now disconnect.

Copyright policy: All transcripts on this site are the copyright of Seeking Alpha. However, we view them as an important resource for bloggers and journalists, and are excited to contribute to the democratization of financial information on the Internet. (Until now investors have had to pay thousands of dollars in subscription fees for transcripts.) So our reproduction policy is as follows: You may quote up to 400 words of any transcript on the condition that you attribute the transcript to Seeking Alpha and either link to the original transcript or to www.SeekingAlpha.com. All other use is prohibited.

THE INFORMATION CONTAINED HERE IS A TEXTUAL REPRESENTATION OF THE APPLICABLE COMPANY'S CONFERENCE CALL, CONFERENCE PRESENTATION OR OTHER AUDIO PRESENTATION, AND WHILE EFFORTS ARE MADE TO PROVIDE AN ACCURATE TRANSCRIPTION, THERE MAY BE MATERIAL ERRORS, OMISSIONS, OR INACCURACIES IN THE REPORTING OF THE SUBSTANCE OF THE AUDIO PRESENTATIONS. IN NO WAY DOES SEEKING ALPHA ASSUME ANY RESPONSIBILITY FOR ANY INVESTMENT OR OTHER DECISIONS MADE BASED UPON THE INFORMATION PROVIDED ON THIS WEB SITE OR IN ANY TRANSCRIPT. USERS ARE ADVISED TO REVIEW THE APPLICABLE COMPANY'S AUDIO PRESENTATION ITSELF AND THE APPLICABLE COMPANY'S SEC FILINGS BEFORE MAKING ANY INVESTMENT OR OTHER DECISIONS.

If you have any additional questions about our online transcripts, please contact us at: transcripts@seekingalpha.com. Thank you!

Source: Hatteras Financial Corp Management Discusses Q1 2013 Results - Earnings Call Transcript
This Transcript
All Transcripts