NEW YORK--(BUSINESS WIRE)--
Annaly Capital Management, Inc. (NYSE: NLY) released a statement by its
Chairman, Chief Executive Officer and President, Michael A.J. Farrell:
“The SEC held an open meeting on August 31 in which, among other things,
the commissioners of the SEC voted to issue a concept release on
interpretive issues related to the status under the Investment Company
Act of 1940 of companies, including mortgage REITs, that are engaged in
the business of acquiring mortgages and mortgage-related instruments and
that rely on the exclusion from the definition of investment company in
Section 3(c)(5)(C) of the Act. The SEC is soliciting comments on a wide
range of issues, including the interpretation of Section 3(c)(5)(C), and
the operation of these companies under the rule.
“On behalf of Annaly and on behalf of Chimera Investment Corporation and
CreXus Investment Corp., the two REITs that are externally managed by
our subsidiary, FIDAC, we look forward to participating in the process
that the SEC has initiated.
“It is worth noting that the effort set in motion by the SEC does not in
any way affect the tax status of REITs, which is a tax election that is
regulated by the restrictions and limitations set forth by the Internal
Revenue Code. Rather, the SEC’s goal is to focus on issues under the
Investment Company Act that have not been reviewed in a formal way since
1960 to see if the staff interpretations in this area should be updated
or made more clear and comprehensive.
“Each of Annaly, Chimera and Crexus constantly monitors its assets so as
to ensure that at all times it is exempt from registration under the
Investment Company Act under the well-established precedents and
guidelines promulgated by the SEC.
“We support the establishment of a clear and comprehensive set of best
practices for the operation and management of all mortgage REITs in
order to preserve their traditional role in capital formation for
residential housing, safeguard their investors and enable them to
continue to generate income-based returns for institutional and retail
investors.
“We look forward to participating in the SEC comment process, and we
encourage all the shareholders of Annaly, Chimera and CreXus to also
participate. To register a comment over the next 60 days, please use the
SEC’s Internet comment form at http://www.sec.gov/rules/concept.shtml
or send an e-mail to [email protected],
or simply contact your elected representatives in Congress.”
This news release and our public documents to which we refer contain or
incorporate by reference certain forward-looking statements within the
meaning of Section 27A of the Securities Act of 1933, as amended, and
Section 21E of the Securities Exchange Act of 1934, as amended.
Forward-looking statements which are based on various assumptions (some
of which are beyond our control) may be identified by reference to a
future period or periods or by the use of forward-looking terminology,
such as "may," "will," "believe," "expect," "anticipate," "continue," or
similar terms or variations on those terms or the negative of those
terms. Actual results could differ materially from those set forth in
forward-looking statements due to a variety of factors, including, but
not limited to, changes in interest rates, changes in the yield curve,
changes in prepayment rates, the availability of mortgage-backed
securities for purchase, the availability of financing and, if
available, the terms of any financing, changes in the market value of
our assets, changes in business conditions and the general economy,
changes in government regulations affecting our business, our ability to
maintain our qualification as a REIT for federal income tax purposes,
risks associated with the broker-dealer business of our subsidiary, and
risks associated with the investment advisory business of our
subsidiaries, including the removal by clients of assets they manage,
their regulatory requirements and competition in the investment advisory
business. For a discussion of the risks and uncertainties which could
cause actual results to differ from those contained in the
forward-looking statements, see "Risk Factors" in our most recent Annual
Report on Form 10-K and any subsequent Quarterly Reports on Form 10-Q.
We do not undertake, and specifically disclaim any obligation, to
publicly release the result of any revisions which may be made to any
forward-looking statements to reflect the occurrence of anticipated or
unanticipated events or circumstances after the date of such statements.
Source: Annaly Capital Management, Inc.