Invesco Mortgage Capital Inc. 10-K

Item 9A. Controls and Procedures. Disclosure Controls and Procedures Our management is responsible for establishing and maintaining disclosure controls and procedures as defined in Rules 13a-15(e) and 15d-15(e) of the Exchange Act. We have evaluated, with the participation of our principal executive officer and principal financial officer, the effectiveness of our disclosure controls and procedures as of December 31, 2025. Based upon our evaluation, our principal executive officer and principal financial officer concluded that our disclosure controls and procedures were effective to provide reasonable assurance that information required to be disclosed by us in the reports that we file or submit under the Exchange Act is recorded, processed, summarized and reported, within the time periods specified in the applicable rules and forms, and that it is accumulated and communicated to our management, including our principal executive officer and principal financial officer, as appropriate to allow timely decisions regarding required disclosure. There are inherent limitations to the effectiveness of any system of disclosure controls and procedures, including the possibility of human error and the circumvention or overriding of the controls and procedures. Accordingly, even effective disclosure controls and procedures can only provide reasonable assurance of achieving their control objectives. Management’s Annual Report on Internal Control over Financial Reporting Our management is responsible for establishing and maintaining adequate internal control over financial reporting, as defined in the Exchange Act, Rules 13a-15(f) and 15d-15(f). Our internal control over financial reporting is a process designed to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with generally accepted accounting principles. Because of its inherent limitations, internal control over financial reporting may not prevent or detect misstatements. Also, projections of any evaluation of effectiveness to future periods are subject to the risk that controls may become inadequate because of changes in conditions, or that the degree of compliance with the policies or procedures may deteriorate. Under the supervision and with the participation of the principal executive officer and principal financial officer, management assessed the effectiveness of our internal control over financial reporting as of December 31, 2025. In making this assessment, management used the criteria set forth by the Committee of Sponsoring Organizations of the Treadway Commission (COSO) in Internal Control - Integrated Framework (2013). Based on this assessment, management concluded that our internal control over financial reporting was effective as of December 31, 2025. Our independent registered public accounting firm, PricewaterhouseCoopers LLP, audited the effectiveness of our internal control over financial reporting as of December 31, 2025. Their report dated February 23, 2026, which is included herein, expressed an unqualified opinion on the effectiveness of our internal control over financial reporting. 63 Table of Contents Changes in Internal Control over Financial Reporting There has been no change in our internal control over financial reporting (as defined in Rules 13a-15(f) and 15d-15(f) of the Exchange Act) during the quarter ended December 31, 2025 that has materially affected, or is reasonably likely to materially affect, our internal control over financial reporting. Item 9B. Other Information. Rule 10b5-1 Trading Plans During the fiscal quarter ended December 31, 2025, none of our directors or officers (as defined in Rule 16a-1(f) under the Exchange Act) adopted or terminated a “Rule 10b5-1 trading arrangement” or “non-Rule 10b5-1 trading arrangement” as each term is defined in Item 408 of Regulation S-K. Series C Preferred Stock Dividends We declared a Series C Preferred Stock dividend of $0.46875 per share on February 18, 2026 that is payable on March 27, 2026 to stockholders of record at the close of business on March 5, 2026. Item 9C. Disclosure Regarding Foreign Jurisdictions that Prevent Inspections. Not applicable. 64 Table of Contents PART III Item 10. Directors, Executive Officers and Corporate Governance. We will provide information that is responsive to certain portions of this Item 10 in our definitive proxy statement or in an amendment to this Report not later than 120 days after the end of the fiscal year covered by this Report, in either case under the captions “Information about Director Nominees,” “Information about the Executive Officers of the Company,” “Corporate Governance,” “Information about the Board and its Committees,” or under captions with similar meanings and possibly elsewhere therein. That information is incorporated into this Item 10 by reference. Each year, the chief executive officer of each company listed on the New York Stock Exchange (“NYSE”) must certify to the NYSE that he or she is not aware of any violation by us of NYSE corporate governance listing standards as of the date of certification, qualifying the certification to the extent necessary. Our chief executive officer submitted this certification to the NYSE in 2025 as required pursuant to Section 303A of the NYSE Listed Company Manual and will submit a similar certification within 30 days of our 2026 annual stockholders’ meeting. In addition, we have filed, as exhibits to this Report, the certifications of our chief executive officer and chief financial officer required under Section 302 and 906 of the Sarbanes-Oxley Act of 2002. Item 11. Executive Compensation. We will provide information that is responsive to this Item 11 in our definitive proxy statement or in an amendment to this Report not later than 120 days after the end of the fiscal year covered by this Report, in either case under the captions “Information About the Board and Its Committees - Director Compensation,” “Executive Compensation,” “Compensation Committee Interlocks and Insider Participation,” or under captions with similar meanings and possibly elsewhere therein. That information is incorporated into this Item 11 by reference. Item 12. Security Ownership of Certain Beneficial Owners and Management and Related Stockholder Matters. We will provide information that is responsive to this Item 12 in our definitive proxy statement or in an amendment to this Report not later than 120 days after the end of the fiscal year covered by this Report, in either case under the caption “Security Ownership of Principal Stockholders,” “Security Ownership of Management,” “Executive Compensation,” or under captions with similar meanings and possibly elsewhere therein. That information is incorporated into this Item 12 by reference. Item 13. Certain Relationships and Related Transactions, and Director Independence. We will provide information that is responsive to this Item 13 in our definitive proxy statement or in an amendment to this Report not later than 120 days after the end of the fiscal year covered by this Report, in either case under the captions “Corporate Governance,” “Certain Relationships and Related Transactions,” “Information About Director Nominees,” “Related Person Transaction Policy,” or under captions with similar meanings and possibly elsewhere therein. That information is incorporated into this Item 13 by reference. Item 14. Principal Accounting Fees and Services. We will provide information that is responsive to this Item 14 in our definitive proxy statement or in an amendment to this Report not later than 120 days after the end of the fiscal year covered by this Report, in either case under the captions “Fees Paid to Independent Registered Public Accounting Firm,” “Pre-Approval Process and Policy,” or under captions with similar meanings and possibly elsewhere therein. That information is incorporated into this Item 14 by reference. PART IV Item 15. Exhibits, Financial Statement Schedules. (a)(1) Financial Statements: The financial statements contained herein are set forth on pages 71 - 96 of this Report. (a)(2) Financial Statement Schedules: Not applicable. (a)(3) Exhibits: Refer to Exhibit Index starting on page 66 of this Report. 65 Table of Contents Exhibit Index Exhibit No. Description 3.1 Articles of Amendment and Restatement of Invesco Mortgage Capital Inc., incorporated by reference to Exhibit 3.1 to our Quarterly Report on Form 10-Q, filed with the SEC on August 12, 2009. 3.2 Articles Supplementary of 7.50% Fixed-to-Floating Series C Cumulative Redeemable Preferred Stock, incorporated by reference to Exhibit 3.4 to our Registration Statement on Form 8-A, filed with the SEC on August 11, 2017. 3.3 Articles Supplementary classifying 4,000,000 shares of the Company's preferred stock as additional Series C Shares, incorporated by reference to Exhibit 3.3 to our Current Report on Form 8-K, filed with the SEC on March 19, 2019. 3.4 Articles of Amendment of Invesco Mortgage Capital Inc., incorporated by reference to Exhibit 3.1 to our Current Report on Form 8-K, filed with the SEC on June 3, 2022. 3.5 Articles of Amendment of Invesco Mortgage Capital Inc., incorporated by reference to Exhibit 3.2 to our Current Report on Form 8-K, filed with the SEC on June 3, 2022. 3.6 Articles of Amendment (Authorized shares), incorporated by reference to Exhibit 3.1 to our Current Report on Form 8-K, filed with the SEC on August 9, 2024. 3.7 Amended and Restated Bylaws of Invesco Mortgage Capital Inc., incorporated by reference to Exhibit 3.1 to our Current Report on Form 8-K, filed with the SEC on February 17, 2017. 4.1 Specimen Common Stock Certificate of Invesco Mortgage Capital Inc, incorporated by reference to Exhibit 4.1 to our Annual Report on Form 10-K filed with the SEC on February 21, 2023. 4.2 Specimen 7.50% Fixed-to-Floating Series C Cumulative Redeemable Preferred Stock Certificate, incorporated by reference to Exhibit 4.5 to our Registration Statement on Form 8-A, filed with the SEC on August 11, 2017. 4.3* Description of Invesco Mortgage Capital Inc. Securities. 10.1 Management Agreement, dated as of July 1, 2009, among Invesco Advisers, Inc. (formally known as Invesco Institutional (N.A.), Inc.), Invesco Mortgage Capital Inc. and IAS Operating Partnership LP., incorporated by reference to Exhibit 10.2 to our Quarterly Report on Form 10-Q, filed with the SEC on August 12, 2009. 10.2 Amendment to Management Agreement, dated as of May 24, 2011, among Invesco Advisers, Inc. (formally known as Invesco Institutional (N.A.), Inc.), Invesco Mortgage Capital Inc., IAS Operating Partnership LP., and IAS Asset I LLC, incorporated by reference to Exhibit 10.1 to our Quarterly Report on Form 10-Q, filed with the SEC on August 9, 2011. 10.3 Second Amendment to Management Agreement, dated as of July 1, 2015, among Invesco Advisers, Inc., Invesco Mortgage Capital Inc., and IAS Operating Partnership LP., incorporated by reference to Exhibit 10.1 to our Quarterly Report on Form 10-Q, filed with the SEC on August 17, 2015. 10.4 Third Amendment to Management Agreement, dated as of November 6, 2019, among Invesco Advisers, Inc., Invesco Mortgage Capital Inc., and IAS Operating Partnership LP., incorporated by reference to Exhibit 10.1 to our Quarterly Report on Form 10-Q, filed with the SEC on November 7, 2019. § 10.5 Invesco Mortgage Capital Inc. Amended and Restated 2009 Equity Incentive Plan, incorporated by reference to Exhibit 99.1 to our Registration Statement on Form S-8, filed with the SEC on May 8, 2024. § 10.6 Form of Restricted Stock Award Agreement for Non-Executive Directors under the Invesco Mortgage Capital Inc. 2009 Equity Incentive Plan (May 2021), incorporated by reference to Exhibit 10.1 to our Quarterly Report on Form 10-Q, filed with the SEC on August 4, 2021. 10.7 Equity Distribution Agreement, dated August 8, 2025 among Invesco Mortgage Capital Inc., IAS Operating Partnership LP, Invesco Advisers, Inc., BTIG, LLC, Citizens JMP Securities, LLC, Janney Montgomery Scott LLC and JonesTrading Institutional Services LLC (incorporated by reference to Exhibit 1.1 to the Current Report on Form 8-K, filed with the SEC on August 8, 2025). 19 Insider Trading Policy, incorporated by reference to Exhibit 19 to our Annual Report on Form 10-K filed with the SEC on February 22, 2024. 21.1* Subsidiaries of the Registrant. 23.1* Consent of PricewaterhouseCoopers LLP. 31.1* Certification of John M. Anzalone pursuant to Rule 13a-14(a), as adopted pursuant to Section 302 of the Sarbanes-Oxley Act of 2002. 66 Table of Contents 31.2* Certification of Mark Gregson pursuant to Rule 13a-14(a), as adopted pursuant to Section 302 of the Sarbanes-Oxley Act of 2002. 32.1** Certification of John M. Anzalone pursuant to Rule 13a-14(b) and 18 U.S.C. Section 1350, as adopted pursuant to Section 906 of the Sarbanes-Oxley Act of 2002. 32.2** Certification of Mark Gregson pursuant to Rule 13a-14(b) and 18 U.S.C. Section 1350, as adopted pursuant to Section 906 of the Sarbanes-Oxley Act of 2002. 97 Policy for Recoupment of Incentive Compensation, incorporated by reference to Exhibit 97 to our Annual Report on Form 10-K filed with the SEC on February 22, 2024. 101 The following series of audited XBRL-formatted documents are collectively included herewith as Exhibit 101. The financial information is extracted from Invesco Mortgage Capital Inc.’s audited consolidated financial statements and notes that are included in this Form 10-K Report. 101.INS XBRL Instance Document - The instance document does not appear in the Interactive Data File because its XBRL tags are embedded within the Inline XBRL document. 101.SCH XBRL Taxonomy Extension Schema Document 101.CAL XBRL Taxonomy Calculation Linkbase Document 101.LAB XBRL Taxonomy Label Linkbase Document 101.PRE XBRL Taxonomy Presentation Linkbase Document 101.DEF XBRL Taxonomy Definition Linkbase Document 104 Cover Page Interactive Data File (formatted as Inline XBRL and contained in Exhibit 101) § Management contract or compensatory plan or arrangement. * Filed herewith ** Furnished herewith Item 16. Form 10-K Summary. Not applicable. 67 Table of Contents INDEX TO FINANCIAL STATEMENTS Page Report of Independent Registered Public Accounting Firm (PCAOB ID 238 ) 69 Consolidated Balance Sheets as of December 31, 202 5 and December 31, 202 4 71 Consolidated Statements of Operations for the years ended December 31, 202 5 , 202 4 and 202 3 72 Consolidated Statements of Comprehensive Income (Loss) for the years ended December 31, 202 5 , 202 4 and 202 3 73 Consolidated Statements of Stockholders' Equity for the years ended December 31, 202 5 , 202 4 and 202 3 74 Consolidated Statements of Cash Flows for the years ended December 31, 202 5 , 202 4 and 202 3 75 Notes to Consolidated Financial Statements 76 68 Table of Contents Report of Independent Registered Public Accounting Firm To the Board of Directors and Stockholders of Invesco Mortgage Capital Inc. Opinions on the Financial Statements and Internal Control over Financial Reporting We have audited the accompanying consolidated balance sheets of Invesco Mortgage Capital Inc. and its subsidiaries (the “Company”) as of December 31, 2025 and 2024, and the related consolidated statements of operations, of comprehensive income (loss), of stockholders' equity and of cash flows for each of the three years in the period ended December 31, 2025, including the related notes (collectively referred to as the “consolidated financial statements”). We also have audited the Company's internal control over financial reporting as of December 31, 2025, based on criteria established in Internal Control - Integrated Framework (2013) issued by the Committee of Sponsoring Organizations of the Treadway Commission (COSO). In our opinion, the consolidated financial statements referred to above present fairly, in all material respects, the financial position of the Company as of December 31, 2025 and 2024, and the results of its operations and its cash flows for each of the three years in the period ended December 31, 2025 in conformity with accounting principles generally accepted in the United States of America. Also in our opinion, the Company maintained, in all material respects, effective internal control over financial reporting as of December 31, 2025, based on criteria established in Internal Control - Integrated Framework (2013) issued by the COSO. Basis for Opinions The Company's management is responsible for these consolidated financial statements, for maintaining effective internal control over financial reporting, and for its assessment of the effectiveness of internal control over financial reporting, included in Management’s Annual Report on Internal Control over Financial Reporting appearing under Item 9A. Our responsibility is to express opinions on the Company’s consolidated financial statements and on the Company's internal control over financial reporting based on our audits. We are a public accounting firm registered with the Public Company Accounting Oversight Board (United States) (PCAOB) and are required to be independent with respect to the Company in accordance with the U.S. federal securities laws and the applicable rules and regulations of the Securities and Exchange Commission and the PCAOB. We conducted our audits in accordance with the standards of the PCAOB. Those standards require that we plan and perform the audits to obtain reasonable assurance about whether the consolidated financial statements are free of material misstatement, whether due to error or fraud, and whether effective internal control over financial reporting was maintained in all material respects. Our audits of the consolidated financial statements included performing procedures to assess the risks of material misstatement of the consolidated financial statements, whether due to error or fraud, and performing procedures that respond to those risks. Such procedures included examining, on a test basis, evidence regarding the amounts and disclosures in the consolidated financial statements. Our audits also included evaluating the accounting principles used and significant estimates made by management, as well as evaluating the overall presentation of the consolidated financial statements. Our audit of internal control over financial reporting included obtaining an understanding of internal control over financial reporting, assessing the risk that a material weakness exists, and testing and evaluating the design and operating effectiveness of internal control based on the assessed risk. Our audits also included performing such other procedures as we considered necessary in the circumstances. We believe that our audits provide a reasonable basis for our opinions. Definition and Limitations of Internal Control over Financial Reporting A company’s internal control over financial reporting is a process designed to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with generally accepted accounting principles. A company’s internal control over financial reporting includes those policies and procedures that (i) pertain to the maintenance of records that, in reasonable detail, accurately and fairly reflect the transactions and dispositions of the assets of the company; (ii) provide reasonable assurance that transactions are recorded as necessary to permit preparation of financial statements in accordance with generally accepted accounting principles, and that receipts and expenditures of the company are being made only in accordance with authorizations of management and directors of the company; and (iii) provide reasonable assurance regarding prevention or timely detection of unauthorized acquisition, use, or disposition of the company’s assets that could have a material effect on the financial statements. Because of its inherent limitations, internal control over financial reporting may not prevent or detect misstatements. Also, projections of any evaluation of effectiveness to future periods are subject to the risk that controls may become inadequate because of changes in conditions, or that the degree of compliance with the policies or procedures may deteriorate. 69 Table of Contents Critical Audit Matters The critical audit matter communicated below is a matter arising from the current period audit of the consolidated financial statements that was communicated or required to be communicated to the audit committee and that (i) relates to accounts or disclosures that are material to the consolidated financial statements and (ii) involved our especially challenging, subjective, or complex judgments. The communication of critical audit matters does not alter in any way our opinion on the consolidated financial statements, taken as a whole, and we are not, by communicating the critical audit matter below, providing a separate opinion on the critical audit matter or on the accounts or disclosures to which it relates. Valuation of Mortgage-Backed Securities, at fair value As described in Notes 2 and 8 to the consolidated financial statements, the Company’s mortgage-backed securities, at fair value were $6.3 billion as of December 31, 2025. Management determines the fair value of mortgage-backed securities using an independent primary pricing service. If the primary pricing service cannot provide a price, management seeks a value from other pricing services. The pricing service uses two types of valuation approaches to determine the valuation of the Company’s various mortgage-backed securities: a market approach, which uses observable prices and other relevant information that is generated by market transactions involving identical or comparable assets or liabilities; and an income approach, which uses valuation techniques to convert future amounts to a single, discounted present value amount. The principal considerations for our determination that performing procedures relating to the valuation of mortgage-backed securities, at fair value is a critical audit matter are the high degree of auditor effort in performing procedures and evaluating audit evidence related to the fair value of the mortgage-backed securities. Addressing the matter involved performing procedures and evaluating audit evidence in connection with forming our overall opinion on the consolidated financial statements. These procedures included testing the effectiveness of controls relating to the valuation of mortgage-backed securities, at fair value. These procedures also included, among others, (i) developing an independent range of prices for the securities by obtaining independent pricing from third party vendors; (ii) comparing management’s estimate of fair value to the independent range of prices to evaluate the reasonableness of management’s estimate; and (iii) testing the completeness and accuracy of the data provided by management. /s/ PricewaterhouseCoopers LLP Atlanta, Georgia February 23, 2026 We have served as the Company’s auditor since 2016. 70 Table of Contents INVESCO MORTGAGE CAPITAL INC. AND SUBSIDIARIES CONSOLIDATED BALANCE SHEETS As of $ in thousands except share amounts December 31, 2025 December 31, 2024 ASSETS Mortgage-backed securities, at fair value (including pledged securities of $ 5,879,318 and $ 5,129,486 , respectively, net of allowance for credit losses of $ 0 and $ 654 , respectively) 6,276,609 5,445,508 Cash and cash equivalents 56,040 73,403 Restricted cash 110,391 137,478 Due from counterparties — 580 Investment related receivable 27,848 24,870 Derivative assets, at fair value 4,412 5,033 Other assets 594 1,162 Total assets 6,475,894 5,688,034 LIABILITIES AND STOCKHOLDERS' EQUITY Liabilities: Repurchase agreements 5,619,255 4,893,958 Derivative liabilities, at fair value — 627 Dividends payable 25,845 24,692 Accrued interest payable 28,664 32,711 Accounts payable and accrued expenses 1,580 1,619 Due to affiliate 3,006 3,698 Total liabilities 5,678,350 4,957,305 Commitments and contingencies (See Note 13) Stockholders' equity: Preferred Stock, par value $ 0.01 per share; 50,000,000 shares authorized: 7.50 % Fixed-to-Floating Series C Cumulative Redeemable Preferred Stock: 6,854,131 shares and 7,206,659 shares issued and outstanding, respectively ($ 171,353 and $ 180,166 aggregate liquidation preference, respectively) 165,756 174,281 Common Stock, par value $ 0.01 per share; 134,000,000 shares authorized; 71,790,532 and 61,729,693 shares issued and outstanding, respectively 718 617 Additional paid in capital 4,209,977 4,127,807 Accumulated other comprehensive income — 173 Retained earnings (distributions in excess of earnings) ( 3,578,907 ) ( 3,572,149 ) Total stockholders’ equity 797,544 730,729 Total liabilities and stockholders' equity 6,475,894 5,688,034 The accompanying notes are an integral part of these consolidated financial statements. 71 Table of Contents INVESCO MORTGAGE CAPITAL INC. AND SUBSIDIARIES CONSOLIDATED STATEMENTS OF OPERATIONS Years Ended December 31, 2025 2024 2023 $ in thousands, except share data Interest income 295,287 286,546 277,929 Interest expense 219,865 249,719 228,229 Net interest income 75,422 36,827 49,700 Other income (loss) Gain (loss) on investments, net 149,344 ( 133,911 ) ( 107,280 ) (Increase) decrease in provision for credit losses — ( 458 ) ( 320 ) Equity in earnings (losses) of unconsolidated ventures — ( 193 ) ( 1 ) Gain (loss) on derivative instruments, net ( 104,926 ) 176,634 61,838 Other investment income (loss), net — 2 ( 66 ) Total other income (loss) 44,418 42,074 ( 45,829 ) Expenses Management fee — related party 11,295 11,866 12,290 General and administrative 7,266 7,153 7,440 Total expenses 18,561 19,019 19,730 Net income (loss) 101,279 59,882 ( 15,859 ) Dividends to preferred stockholders ( 13,120 ) ( 22,011 ) ( 23,153 ) Gain (loss) on repurchase and retirement of preferred stock 14 427 1,471 Issuance and redemption costs of redeemed preferred stock — ( 3,535 ) — Net income (loss) attributable to common stockholders 88,173 34,763 ( 37,541 ) Earnings (loss) per share: Net income (loss) attributable to common stockholders Basic 1.32 0.65 ( 0.85 ) Diluted 1.32 0.65 ( 0.85 ) Weighted average number of shares of common stock: Basic 66,881,856 53,773,405 44,073,815 Diluted 66,883,654 53,775,143 44,073,815 The accompanying notes are an integral part of these consolidated financial statements. 72 Table of Contents INVESCO MORTGAGE CAPITAL INC. AND SUBSIDIARIES CONSOLIDATED STATEMENTS OF COMPREHENSIVE INCOME (LOSS) Years Ended December 31, 2025 2024 2023 $ in thousands Net income (loss) 101,279 59,882 ( 15,859 ) Other comprehensive income (loss): Unrealized gain (loss) on mortgage-backed securities, net 229 ( 1,051 ) ( 91 ) Reclassification of unrealized (gain) loss on sale of mortgage-backed securities to gain (loss) on investments, net ( 402 ) — — Reclassification of unrealized loss on available-for-sale securities to (increase) decrease in provision for credit losses — 526 320 Reclassification of amortization of net deferred (gain) loss on de-designated interest rate swaps to interest expense — — ( 10,405 ) Currency translation adjustments on investment in unconsolidated venture — — ( 10 ) Reclassification of currency translation loss on investment in unconsolidated venture to other investment income (loss), net — — 123 Total other comprehensive income (loss) ( 173 ) ( 525 ) ( 10,063 ) Comprehensive income (loss) 101,106 59,357 ( 25,922 ) Dividends to preferred stockholders ( 13,120 ) ( 22,011 ) ( 23,153 ) Gain (loss) on repurchase and retirement of preferred stock 14 427 1,471 Issuance and redemption costs of redeemed preferred stock — ( 3,535 ) — Comprehensive income (loss) attributable to common stockholders 88,000 34,238 ( 47,604 ) The accompanying notes are an integral part of these consolidated financial statements. 73 Table of Contents INVESCO MORTGAGE CAPITAL INC. AND SUBSIDIARIES CONSOLIDATED STATEMENTS OF STOCKHOLDERS' EQUITY $ in thousands except share amounts Series B Preferred Stock Series C Preferred Stock Common Stock Additional Paid in Capital Accumulated Other Comprehensive Income (Loss) Retained Earnings (Distributions in Excess of Earnings) Total Stockholders’ Equity Shares Amount Shares Amount Shares Amount Balance as of December 31, 2022 4,537,634 109,679 7,816,470 189,028 38,710,916 387 3,901,562 10,761 ( 3,407,342 ) 804,075 Net income (loss) — — — — — — — — ( 15,859 ) ( 15,859 ) Other comprehensive income (loss) — — — — — — — ( 10,063 ) — ( 10,063 ) Proceeds from issuance of common stock, net of offering costs — — — — 9,699,471 97 109,007 — — 109,104 Stock awards — — — — 50,239 — — — — — Repurchase and retirement of preferred stock ( 151,637 ) ( 3,665 ) ( 271,031 ) ( 6,554 ) — — — — 1,471 ( 8,748 ) Common stock dividends — — — — — — — — ( 73,260 ) ( 73,260 ) Preferred stock dividends — — — — — — — — ( 23,153 ) ( 23,153 ) Amortization of equity-based compensation — — — — — — 569 — — 569 Balance as of December 31, 2023 4,385,997 106,014 7,545,439 182,474 48,460,626 484 4,011,138 698 ( 3,518,143 ) 782,665 Net income (loss) — — — — — — — — 59,882 59,882 Other comprehensive income (loss) — — — — — — — ( 525 ) — ( 525 ) Proceeds from issuance of common stock, net of offering costs — — — — 13,204,968 132 116,083 — — 116,215 Stock awards — — — — 64,099 1 — — — 1 Redemption of preferred stock ( 4,247,989 ) ( 102,678 ) — — — — — — ( 3,535 ) ( 106,213 ) Repurchase and retirement of preferred stock ( 138,008 ) ( 3,336 ) ( 338,780 ) ( 8,193 ) — — — — 427 ( 11,102 ) Common stock dividends — — — — — — — — ( 88,769 ) ( 88,769 ) Preferred stock dividends — — — — — — — — ( 22,011 ) ( 22,011 ) Amortization of equity-based compensation — — — — — — 586 — — 586 Balance as of December 31, 2024 — — 7,206,659 174,281 61,729,693 617 4,127,807 173 ( 3,572,149 ) 730,729 Net income (loss) — — — — — — — — 101,279 101,279 Other comprehensive income (loss) — — — — — — — ( 173 ) — ( 173 ) Proceeds from issuance of common stock, net of offering costs — — — — 9,983,179 100 81,483 — — 81,583 Stock awards — — — — 77,660 1 — — — 1 Repurchase and retirement of preferred stock — — ( 352,528 ) ( 8,525 ) — — — — 14 ( 8,511 ) Common stock dividends — — — — — — — — ( 94,931 ) ( 94,931 ) Preferred stock dividends — — — — — — — — ( 13,120 ) ( 13,120 ) Amortization of equity-based compensation — — — — — — 687 — — 687 Balance as of December 31, 2025 — — 6,854,131 165,756 71,790,532 718 4,209,977 — ( 3,578,907 ) 797,544 The accompanying notes are an integral part of these consolidated financial statements. 74 Table of Contents INVESCO MORTGAGE CAPITAL INC. AND SUBSIDIARIES CONSOLIDATED STATEMENTS OF CASH FLOWS $ in thousands Years Ended December 31, 2025 2024 2023 Cash Flows from Operating Activities Net income (loss) 101,279 59,882 ( 15,859 ) Adjustments to reconcile net income (loss) to net cash provided by (used in) operating activities: Amortization of premiums and (discounts), net ( 5,658 ) ( 13,310 ) ( 14,380 ) Realized and unrealized (gain) loss on derivative instruments, net 217,170 ( 14,872 ) 177,170 (Gain) loss on investments, net ( 149,344 ) 133,911 107,280 Increase (decrease) in provision for credit losses — 458 320 (Gain) loss from investments in unconsolidated ventures in excess of distributions received — 193 1 Other amortization 688 587 ( 9,836 ) Loss on foreign currency translation — — 123 Changes in operating assets and liabilities: (Increase) decrease in operating assets ( 2,265 ) ( 613 ) ( 1,977 ) Increase (decrease) in operating liabilities ( 4,785 ) 16,924 ( 5,055 ) Net cash provided by (used in) operating activities 157,085 183,160 237,787 Cash Flows from Investing Activities Purchase of mortgage-backed securities ( 2,666,485 ) ( 2,221,726 ) ( 5,933,598 ) Purchase of U.S. Treasury securities — — ( 59,514 ) Distributions from investments in unconsolidated ventures, net — 307 41 Principal payments from mortgage-backed securities 531,878 389,455 348,547 Proceeds from sale of mortgage-backed securities 1,458,335 1,312,954 5,236,686 Proceeds from sale of U.S. Treasury securities — 10,755 48,977 Settlement (termination) of swaps, TBAs, futures and forwards, net ( 217,176 ) 11,405 ( 179,526 ) Net change in due from counterparties and collateral held payable on derivative instruments 580 ( 580 ) 1,584 Net cash provided by (used in) investing activities ( 892,868 ) ( 497,430 ) ( 536,803 ) Cash Flows from Financing Activities Proceeds from issuance of common stock 81,625 116,460 109,104 Redemption of preferred stock — ( 106,213 ) — Repurchase of preferred stock ( 8,511 ) ( 11,102 ) ( 8,748 ) Proceeds from repurchase agreements 48,362,061 38,471,781 41,084,893 Principal repayments of repurchase agreements ( 47,636,764 ) ( 38,036,099 ) ( 40,861,440 ) Net change in due from counterparties and collateral held payable on repurchase agreements — ( 2,475 ) ( 2,417 ) Payments of deferred costs ( 180 ) ( 366 ) ( 329 ) Payments of dividends ( 106,898 ) ( 105,472 ) ( 102,191 ) Net cash provided by (used in) financing activities 691,333 326,514 218,872 Net change in cash, cash equivalents and restricted cash ( 44,450 ) 12,244 ( 80,144 ) Cash, cash equivalents and restricted cash, beginning of period 210,881 198,637 278,781 Cash, cash equivalents and restricted cash, end of period 166,431 210,881 198,637 Supplement Disclosure of Cash Flow Information Interest paid 223,913 232,794 243,394 Non-cash Investing and Financing Activities Information Dividends declared not paid 25,845 24,692 19,384 Unsettled receivables recorded within investment related receivable — — 2,429 The accompanying notes are an integral part of these consolidated financial statements. 75 Table of Contents INVESCO MORTGAGE CAPITAL INC. AND SUBSIDIARIES NOTES TO CONSOLIDATED FINANCIAL STATEMENTS Note 1 – Organization and Business Operations Invesco Mortgage Capital Inc. (the “Company” or “we”) is a Maryland corporation primarily focused on investing in, financing and managing mortgage-backed securities (“MBS”) and other mortgage-related assets. As of December 31, 2025, we were invested in: • residential mortgage-backed securities (“RMBS”) that are guaranteed by a U.S. government agency such as the Government National Mortgage Association (“Ginnie Mae”), or a federally chartered corporation such as the Federal National Mortgage Association (“Fannie Mae”) or the Federal Home Loan Mortgage Corporation (“Freddie Mac”) (collectively “Agency RMBS”); and • commercial mortgage-backed securities (“CMBS”) that are guaranteed by a U.S. government agency such as Ginnie Mae or a federally chartered corporation such as Fannie Mae or Freddie Mac (collectively “Agency CMBS”). During the periods presented in these consolidated financial statements, we also invested in CMBS and RMBS that are not guaranteed by a U.S. government agency or a federally chartered corporation (“non-Agency CMBS” and “non-Agency RMBS”, respectively), U.S. Treasury securities and real estate-related financing arrangements in the form of unconsolidated ventures. We conduct our business through IAS Operating Partnership L.P. (the “Operating Partnership”) and have one operating segment. We are externally managed and advised by Invesco Advisers, Inc. (our “Manager”), a registered investment adviser and an indirect, wholly-owned subsidiary of Invesco Ltd. (“Invesco”), an independent global investment management firm. We elected to be taxed as a real estate investment trust (“REIT”) for U.S. federal income tax purposes under the provisions of the Internal Revenue Code of 1986. To maintain our REIT qualification, we are required to distribute at least 90 % of our REIT taxable income to our stockholders annually, and we will generally not be subject to U.S. federal or state corporate income tax to the extent that we distribute all of our annual taxable income to our stockholders on a timely basis. It is our intention to distribute 100 % of our taxable income within the time limits prescribed by the Internal Revenue Code. We operate our business in a manner that permits our exclusion from the “Investment Company” definition under the Investment Company Act of 1940, as amended (the “1940 Act”). Note 2 – Summary of Significant Accounting Policies Basis of Presentation and Consolidation Our consolidated financial statements have been prepared in accordance with generally accepted accounting principles in the United States of America (“U.S. GAAP”) and consolidate the financial statements of the Company and its controlled subsidiaries. All significant intercompany transactions, balances, revenues and expenses are eliminated upon consolidation. Use of Estimates The preparation of consolidated financial statements in conformity with U.S. GAAP requires management to make estimates and assumptions that affect the amounts reported in our consolidated financial statements and accompanying notes. Examples of estimates include, but are not limited to, estimates of the fair values of financial instruments, interest income on mortgage-backed securities and allowances for credit losses. Actual results may differ from those estimates. Fair Value Measurements As described in Note 8 - “Fair Value of Financial Instruments,” we evaluate the source used to fair value our assets and liabilities and make a determination on its categorization within the fair value hierarchy. If the price of an instrument is readily available, meaning that it is a quoted price in an active market for identical assets, the instrument is classified as a level 1 measurement. If the price of an instrument is obtained from quoted prices in inactive markets for similar instruments, or whose values are model-derived but the inputs are observable either directly or indirectly, the instrument is classified as a level 2 measurement. If the inputs appear to be not observable and reflect judgment about assumptions used to value the instrument, the instrument would be classified as a level 3 measurement. Transfers between levels, if any, are determined at the end of the reporting period. We report our MBS and derivative assets and liabilities at fair value as determined by an independent pricing service. We generally obtain one price per instrument from our primary pricing service. If the primary pricing service cannot provide a price, we will seek a value from other pricing services. 76 Table of Contents The pricing service uses two types of valuation approaches to determine the valuation of our various mortgage-backed securities: a market approach, which uses observable prices and other relevant information that is generated by market transactions involving identical or comparable assets or liabilities; and an income approach, which uses valuation techniques to convert future amounts to a single, discounted present value amount. In instances where sufficient market activity may not exist, the pricing service may utilize proprietary valuation models that may consider market transactions in comparable securities and the various relationships between securities in determining fair value and/or market characteristics to estimate relevant cash flows, which are then discounted to calculate the fair values. Observable inputs may include a combination of benchmark yields, executed trades, broker/dealer quotes, issuer spreads, bids, offers and benchmark securities. In addition, the valuation models utilized by pricing services may consider additional pool level information such as prepayment speeds, default frequencies and default severities, if applicable. We and the pricing service continuously monitor market indicators and economic events to determine whether they may have an impact on our valuations. Our MBS are classified as Level 2 measurements in the fair value hierarchy. Our U.S. Treasury futures contracts are valued based on exchange pricing for identical instruments and classified as Level 1 measurements in the fair value hierarchy. Interest rate swaps are valued using the daily settlement price, or fair value, determined by the clearing exchange based on a pricing model that references observable market data, including current benchmark rates and the forward yield curve. The valuation methodology for to-be-announced securities forward contracts (“TBAs”) is similar to that of our Agency RMBS. Our interest rate swaps and TBAs are classified as Level 2 measurements in the fair value hierarchy. Overrides of prices from pricing services are rare in the current market environment for the assets we hold. Examples of instances that would cause an override include if we recently traded the same security or there is an indication of market activity that would cause the pricing service price to no longer be indicative of fair value. In the rare instance where a price is adjusted, we have a control process to monitor the reason for such adjustment. To gain comfort that pricing service prices are representative of current market information, we compare the transaction prices of security purchases and sales to the valuation levels provided by the pricing services. Price differences exceeding pre-defined tolerance levels are identified and investigated and may be challenged. Trends are monitored over time and if there are indications that the valuations are not comparable to market activity, the pricing services are asked to provide detailed information regarding their methodology and inputs. Transparency tools are also available from the pricing services which help us understand data points and/or market inputs used for pricing securities. We also review daily price movements for interest rate swaps, U.S. Treasury futures contracts and TBAs. Price movements exceeding pre-defined tolerance levels are investigated using an alternate price from another pricing service as well as available market information. Based on our findings, the primary pricing service may be challenged, or in rare cases, overridden with an alternate pricing source. In addition, we perform due diligence procedures on all pricing services on at least an annual basis. A questionnaire is sent to pricing services which requests information such as changes in methodologies, business recovery preparedness, internal controls and confirmation that evaluations are generated based on market data. Mortgage-Backed Securities We record our purchases of MBS on the trade date and report these securities at fair value as described above in the Fair Value Measurements section of this Note 2 to our consolidated financial statements. We have elected the fair value option for all of our MBS held as of December 31, 2025 (December 31, 2024: $ 5.4 billion or 99.7 % of our MBS). Under the fair value option, we recognize changes in fair value in our consolidated statements of operations. In our view, the election more appropriately reflects the results of our operations because MBS fair value changes are accounted for in the same manner as fair value changes in our economic hedging instruments. We elected the fair value option for all MBS purchased on or after September 1, 2016. Our MBS that were held as of December 31, 2024 for which we had not elected the fair value option were classified as available-for-sale, with unrealized gains or losses recorded in accumulated other comprehensive income, a separate component of stockholders' equity, until sale or disposition of the investment. Upon sale or disposition, the cumulative gain or loss previously reported in stockholders' equity was recognized in income. Realized gains and losses from sales of MBS are determined based upon the specific identification method. Our interest income recognition policies for MBS is described below in the Interest Income Recognition section of this Note 2 to our consolidated financial statements. 77 Table of Contents Allowances for Credit Losses on Available-for-Sale Securities Prior to the sale of our MBS that were classified as available-for-sale, we were required to evaluate those securities for credit losses. Allowances for credit losses were estimated based on a comparison of the investment's amortized cost basis to its discounted expected cash flows. Credit losses were recorded within (increase) decrease in provisions for credit losses in our consolidated statements of operations. U.S. Treasury Securities U.S. Treasury securities are classified as trading securities and reported at fair value on our consolidated balance sheets. Purchases of U.S. Treasury securities are recorded on the trade date. Changes in the fair value of U.S. Treasury securities are recognized within gain (loss) on investments, net in our consolidated statements of operations. Interest Income Recognition Mortgage-Backed Securities Interest income on MBS is accrued based on the outstanding principal or notional balance of the securities and their contractual terms. Premiums or discounts are amortized or accreted into interest income over the life of the investment using the effective interest method. For Agency MBS that cannot be prepaid in such a way that we would not recover substantially all of our initial investment, interest income recognition is based on contractual cash flows. We do not estimate prepayments in applying the effective interest method. Interest income on our MBS where we may not recover substantially all of our initial investment is based on estimated future cash flows. We estimate future expected cash flows at the time of purchase and determine the effective interest rate based on these estimated cash flows and our purchase price. Over the life of the investments, we update these estimated future cash flows and compute a revised yield based on the current amortized cost of the investment In estimating these future cash flows, there are a number of assumptions that are subject to uncertainties and contingencies, including but not limited to the rate and timing of principal payments, the pass through or coupon rate and interest rate fluctuations. These uncertainties and contingencies are difficult to predict and are subject to future events that may impact our estimate and our interest income. Changes in our original or most recent cash flow projections may result in a prospective change in interest income recognized on these securities, or the amortized cost of these securities. For non-Agency RMBS not of high credit quality, when actual cash flows varied from expected cash flows, the difference was recorded as an adjustment to the amortized cost of the security and the security's yield was revised prospectively. U.S. Treasury Securities Coupon interest income on U.S. Treasury securities is accrued based on the outstanding principal balance of the securities and their contractual terms. Cash and Cash Equivalents We consider all highly liquid investments that have original or remaining maturity dates of three months or less when purchased to be cash equivalents. As of December 31, 2025, we had cash and cash equivalents in excess of the FDIC deposit insurance limit of $ 250,000 per institution. We mitigate our risk of loss by actively monitoring our counterparties. Restricted Cash Restricted cash represents initial margin posted on our interest rate swaps and futures contracts. Cash posted as initial margin is not available for general corporate purposes. Due from Counterparties / Collateral Held Payable Due from counterparties represents cash variation margin posted with our counterparties as collateral on our TBAs and repurchase agreements. Collateral held payable represents cash variation margin posted with us by counterparties as collateral on our TBAs and repurchase agreements. If we receive collateral other than cash from our counterparties under repurchase agreements, such assets are not included in our consolidated balance sheets. If we either sell such assets or pledge the assets as collateral under a repurchase agreement, the cash received and the corresponding liability are reflected on the consolidated balance sheets. 78 Table of Contents Investment Related Receivable / Investment Related Payable Investment related receivable consists of receivables for mortgage-backed securities that we have sold but have not settled with the buyer and accrued interest and principal paydowns on mortgage-backed securities. Investment related payable consists of liabilities for mortgage-backed securities that we have purchased but have not settled with the seller. Repurchase Agreements We have financed our purchases of mortgage-backed securities primarily through the use of repurchase agreements. Repurchase agreements are treated as collateralized financing transactions and are carried at their contractual amounts, including accrued interest that is recorded as accrued interest payable in our consolidated balance sheets, as specified in the respective agreements. We record the mortgage-backed securities and the related repurchase agreement financing on a gross basis in our consolidated balance sheets, and the corresponding interest income and interest expense on a gross basis in our consolidated statements of operations. Dividends Payable Dividends payable represent dividends declared at the balance sheet date that are payable to common stockholders and/or preferred stockholders. Earnings (Loss) per Share We calculate basic earnings (loss) per share by dividing net income (loss) attributable to common stockholders for the period by the weighted-average number of shares of our common stock outstanding for that period. Diluted earnings per share takes into account the effect of dilutive instruments, such as unvested restricted stock awards, and uses the average share price for the period in determining the number of incremental shares that are to be added to the weighted-average number of shares outstanding. Share-Based Compensation Under the terms of our amended and restated 2009 Equity Incentive Plan (the “Incentive Plan”), our independent directors are eligible to receive stock awards as part of their compensation for serving as directors, In addition, we may compensate the officers and employees of our Manager and its affiliates under the Incentive Plan under the terms of our management agreement. Share-based compensation arrangements may include share options, restricted and non-restricted share awards, performance-based awards and share appreciation rights. Compensation related to stock awards is recognized in the consolidated financial statements based on the fair value of the equity or liability instruments issued on the date of grant. Underwriting Commissions and Offering Costs Underwriting commissions and direct costs incurred in connection with our common and preferred stock offerings are recorded as a reduction of additional paid in capital and preferred stock, respectively. Comprehensive Income Our comprehensive income consists of net income, as presented in the consolidated statements of operations, adjusted as appropriate for items such as unrealized gains and losses on available-for-sale MBS; reclassification of unrealized gains and losses upon sale of available-for-sale MBS to gain (loss) on investments, net; reclassification of unrealized losses on available-for-sale securities to (increase) decrease in provision for credit losses; reclassification of amortization of net deferred gains and losses on de-designated interest rate swaps to repurchase agreements interest expense and currency translation adjustments on an investment in an unconsolidated venture. Unrealized gains and losses on available-for-sale MBS were reclassified into net income upon their sale. Accounting for Derivative Financial Instruments We record all derivatives on our consolidated balance sheets at fair value. At the inception of a derivative contract, we determine whether the instrument will be part of a qualifying hedge accounting relationship or whether we will account for the contract as a trading instrument. We have elected not to apply hedge accounting to all new derivative contracts entered into after January 1, 2014. Changes in the fair value of our derivatives are recorded in gain (loss) on derivative instruments, net in our consolidated statements of operations. Net interest paid or received under our interest rate swaps is also recognized in gain 79 Table of Contents (loss) on derivative instruments, net in our consolidated statements of operations. Cash receipts or payments that are attributed to contractual interest earned or incurred on interest rate swaps are classified as cash flows from operating activities in our consolidated statements of cash flows. All other cash flows from derivatives are generally recorded as investing cash flows in our consolidated statements of cash flows. Before 2014, we applied hedge accounting to our interest rate swap agreements. Effective December 31, 2013, we voluntarily discontinued hedge accounting for our interest rate swap agreements by de-designating the interest rate swaps as cash flow hedges. Amounts recorded in accumulated other comprehensive income (loss) (“AOCI”) before we discontinued cash flow hedge accounting for our interest rate swaps were reclassified to interest expense on repurchase agreements on the consolidated statements of operations as interest was accrued and paid on the related repurchase agreements over the remaining original life of the interest rate swap agreements. We evaluate the terms and conditions of our U.S. Treasury futures contracts, currency forward contracts and TBAs to determine if an instrument has the characteristics of an investment or should be considered a derivative under U.S. GAAP. Accordingly, U.S. Treasury futures contracts, currency forward contracts and TBAs having the characteristics of derivatives are accounted for at fair value with such changes recognized in gain (loss) on derivative instruments, net in the consolidated statements of operations. The fair value of interest rate swaps, U.S. Treasury futures contracts, currency forward contracts and TBAs is included in derivative assets or derivative liabilities on the consolidated balance sheets. Daily variation margin received or paid on interest rate swaps and U.S. Treasury futures contracts is accounted for as settlement of the derivative itself rather than as collateral and is recorded as a reduction in the corresponding derivative asset or derivative liability. Income Taxes We elected to be taxed as a REIT. Accordingly, we will generally not be subject to U.S. federal and applicable state and local corporate income tax to the extent that we make qualifying distributions to our stockholders, and provided we satisfy on a continuing basis, through actual investment and operating results, the REIT requirements including certain asset, income, distribution and stock ownership tests. If we fail to qualify as a REIT and do not qualify for certain statutory relief provisions, we will be subject to U.S. federal, state and local income taxes and may be precluded from qualifying as a REIT for the four taxable years following the year in which we lost our REIT qualification. Accordingly, our failure to qualify as a REIT could have a material adverse impact on our results of operations and amounts available for distribution to stockholders. Our dividends paid deduction for qualifying dividends to our stockholders is computed using our REIT taxable income as opposed to net income reported on the consolidated financial statements. REIT taxable income will generally differ from net income because the determination of REIT taxable income is based on tax regulations and not financial accounting principles. We did not incur an income tax liability for the years ended December 31, 2024 and 2023 and do not expect to incur an income tax liability for the year ended December 31, 2025. Accordingly, our effective tax rate was 0% and we did not pay any income tax. We have net operating loss carryforwards that do not expire and capital loss carryforwards that expire five years after the fiscal tax years in which they were created. We do not recognize our net operating loss carryforwards or capital loss carryforwards as deferred tax assets on our consolidated balance sheets because we do not expect to incur income taxes. We have elected to treat one of our subsidiaries as a taxable REIT subsidiary (“TRS”). In general, a TRS may hold assets and engage in activities that we cannot hold or engage in directly and generally may engage in any real estate or non-real estate-related business. A TRS is subject to U.S. federal, state and local corporate income taxes. Our TRS did not generate taxable income for the years ended December 31, 2025, 2024 and 2023. We do not have any accruals for uncertain tax positions. Our tax returns for tax years 2022 and forward are open to examination by the IRS. We would recognize interest and penalties, if any, as income tax expense, which would be included in general and administrative expenses. Recently Issued Accounting Pronouncements In November 2024, the Financial Accounting Standards Board issued an accounting standard requiring public business entities to disclose disaggregated information about certain income statement line items. Public business entities are required to disclose purchases of inventory, employee compensation, depreciation, intangible asset amortization and depletion for each income statement line item that contains those expenses. Specified expenses, gains or losses that are already disclosed under existing U.S. GAAP are required to be included in the disaggregated income statement expense line item disclosures, and any remaining amounts need to be described qualitatively. Separate disclosures of total selling expenses and an entity’s definition of those expenses are also required. The guidance does not change what an entity presents on the face of its income statement. 80 Table of Contents We are required to implement the new standard prospectively in our consolidated financial statements for the year ended December 31, 2027 and for interim periods thereafter. We may implement the new standard retrospectively, and early adoption is permitted. We are currently evaluating the impact of the new standard. We reviewed all other recently issued accounting standards updates and determined that they were not expected to have a significant impact on our consolidated financial statements when adopted or did not have a significant impact on our consolidated financial statements upon adoption. Note 3 – Mortgage-Backed Securities The following tables summarize our MBS portfolio by asset type as of December 31, 2025 and 2024. As of December 31, 2025 $ in thousands Principal/ Notional Balance Unamortized Premium (Discount) Amortized Cost Unrealized Gain/ (Loss), net Fair Value Period-end Weighted Average Yield (1) Agency RMBS: 30 year fixed-rate pass-through 5,223,764 ( 33,396 ) 5,190,368 118,792 5,309,160 5.46 % Agency CMO (2) 484,974 ( 424,405 ) 60,569 8,751 69,320 9.18 % Agency CMBS 898,047 ( 6,317 ) 891,730 6,399 898,129 4.62 % Total 6,606,785 ( 464,118 ) 6,142,667 133,942 6,276,609 5.37 % (1) Period-end weighted average yield is based on amortized cost as of December 31, 2025 and incorporates future prepayment and loss assumptions when appropriate. Total represents period-end weighted average yield of all mortgage-backed securities. (2) All Agency collateralized mortgage obligations (“Agency CMO”) are interest-only securities (“Agency IO”). As of December 31, 2024 $ in thousands Principal/ Notional Balance Unamortized Premium (Discount) Amortized Cost Allowance for Credit Losses Unrealized Gain/ (Loss), net Fair Value Period-end Weighted Average Yield (1) Agency RMBS: 30 year fixed-rate pass-through 4,626,174 ( 87,357 ) 4,538,817 — 2,708 4,541,525 5.50 % Agency CMO (2) 529,137 ( 461,674 ) 67,463 — 3,313 70,776 9.20 % Agency CMBS 845,736 ( 5,830 ) 839,906 — ( 23,759 ) 816,147 4.59 % Non-Agency CMBS 11,000 — 11,000 ( 654 ) ( 510 ) 9,836 8.91 % Non-Agency RMBS (3)(4)(5) 248,957 ( 242,334 ) 6,623 — 601 7,224 11.13 % Total 6,261,004 ( 797,195 ) 5,463,809 ( 654 ) ( 17,647 ) 5,445,508 5.42 % (1) Period-end weighted average yield is based on amortized cost as of December 31, 2024 and incorporates future prepayment and loss assumptions when appropriate. Total represents period-end weighted average yield of all mortgage-backed securities. (2) All Agency CMO are Agency IO. (3) Non-Agency RMBS is 66.4 % fixed rate, 33.0 % variable rate and 0.6 % floating rate based on fair value. Coupon payments on variable rate investments are based upon changes in the underlying hybrid adjustable-rate mortgage loan coupons, while coupon payments on floating rate investments are based upon a spread to a reference index. (4) Of the total discount in non-Agency RMBS, $ 2.1 million is non-accretable calculated using the principal/notional balance and based on estimated future cash flows of the securities. (5) Non-Agency RMBS includes interest-only securities (“non-Agency IO”) which represent 96.7 % of principal/notional balance, 34.2 % of amortized cost and 31.0 % of fair value. 81 Table of Contents We have elected the fair value option for all of our MBS held as of December 31, 2025. The following table presents the fair value of our available-for-sale securities and securities accounted for under the fair value option by asset type as of December 31, 2024. As of December 31, 2024 $ in thousands Available-for-sale Securities Securities under Fair Value Option Total Fair Value Agency RMBS: 30 year fixed-rate pass-through — 4,541,525 4,541,525 Agency CMO — 70,776 70,776 Agency CMBS — 816,147 816,147 Non-Agency CMBS 9,836 — 9,836 Non-Agency RMBS 5,114 2,110 7,224 Total 14,950 5,430,558 5,445,508 The components of the carrying value of our MBS portfolio as of December 31, 2025 and 2024 are presented below. Accrued interest receivable on our MBS portfolio, which is recorded within investment related receivable on our consolidated balance sheets, was $ 27.8 million as of December 31, 2025 (December 31, 2024: $ 24.9 million). As of December 31, 2025 December 31, 2024 $ in thousands MBS Interest-Only Securities Total MBS Interest-Only Securities Total Principal/notional balance 6,121,811 484,974 6,606,785 5,491,175 769,829 6,261,004 Unamortized premium 39,890 — 39,890 19,651 — 19,651 Unamortized discount ( 79,603 ) ( 424,405 ) ( 504,008 ) ( 116,744 ) ( 700,102 ) ( 816,846 ) Allowance for credit losses — — — ( 654 ) — ( 654 ) Gross unrealized gains (1) 130,576 8,794 139,370 22,443 5,817 28,260 Gross unrealized losses (1) ( 5,385 ) ( 43 ) ( 5,428 ) ( 43,376 ) ( 2,531 ) ( 45,907 ) Fair value 6,207,289 69,320 6,276,609 5,372,495 73,013 5,445,508 (1) Gross unrealized gains and losses includes gains (losses) recognized in net income for securities accounted for under the fair value option as well as, solely with respect to December 31, 2024, gains (losses) for available-for-sale securities which were recognized as adjustments to other comprehensive income. Realization occurred upon sale or settlement of such securities. Further detail on the components of our total gains (losses) on investments, net for the years ended December 31, 2025 and 2024 is provided below in this Note 3. The following table summarizes our MBS portfolio according to estimated weighted average life classifications as of December 31, 2025 and 2024. As of $ in thousands December 31, 2025 December 31, 2024 Greater than one year and less than five years 2,031,058 10,045 Greater than or equal to five years 4,245,551 5,435,463 Total 6,276,609 5,445,508 82 Table of Contents The following tables present the estimated fair value and gross unrealized losses of our MBS by length of time that such securities have been in a continuous unrealized loss position as of December 31, 2025 and 2024. As of December 31, 2025 Less than 12 Months 12 Months or More Total $ in thousands Fair Value Unrealized Losses Number of Securities Fair Value Unrealized Losses Number of Securities Fair Value Unrealized Losses Number of Securities Agency RMBS: 30 year fixed-rate pass-through 463,455 ( 753 ) 6 — — — 463,455 ( 753 ) 6 Agency CMO 3,863 ( 43 ) 1 — — — 3,863 ( 43 ) 1 Agency CMBS 56,903 ( 480 ) 4 273,789 ( 4,152 ) 11 330,692 ( 4,632 ) 15 Total (1) 524,221 ( 1,276 ) 11 273,789 ( 4,152 ) 11 798,010 ( 5,428 ) 22 (1) Fair value option has been elected for all securities in an unrealized loss position. As of December 31, 2024 Less than 12 Months 12 Months or More Total $ in thousands Fair Value Unrealized Losses Number of Securities Fair Value Unrealized Losses Number of Securities Fair Value Unrealized Losses Number of Securities Agency RMBS: 30 year fixed-rate pass-through (1) 2,251,552 ( 18,897 ) 29 — — — 2,251,552 ( 18,897 ) 29 Agency CMO (1) — — — 18,909 ( 2,300 ) 5 18,909 ( 2,300 ) 5 Agency CMBS (1) 792,031 ( 23,949 ) 49 — — — 792,031 ( 23,949 ) 49 Non-Agency CMBS (2) 9,836 ( 510 ) 1 — — — 9,836 ( 510 ) 1 Non-Agency RMBS (3) — — — 1,322 ( 251 ) 9 1,322 ( 251 ) 9 Total 3,053,419 ( 43,356 ) 79 20,231 ( 2,551 ) 14 3,073,650 ( 45,907 ) 93 (1) Fair value option has been elected for all Agency securities in an unrealized loss position. (2) Unrealized losses on non-Agency CMBS were included in accumulated other comprehensive income. These losses were not reflected in an allowance for credit losses based on a comparison of discounted expected cash flows to current amortized cost basis. (3) Includes non-Agency IO with a fair value of $ 1.1 million for which the fair value option has been elected. Such securities have unrealized losses of $ 231,000 . We were required to evaluate our available-for-sale MBS for credit losses. During the year ended December 31, 2025, we sold our remaining available-for-sale MBS for cash proceeds of $ 15.1 million and recognized net gains upon sale of $ 402,000 . We did not sell any available-for-sale MBS during the years ended December 31, 2024 or 2023. The following table presents a roll-forward of our allowance for credit losses. $ in thousands Years Ended December 31, 2025 2024 2023 Beginning allowance for credit losses ( 654 ) ( 320 ) — Additions to the allowance for credit losses on securities for which credit losses were not previously recorded — — ( 320 ) Additional increases to the allowance for credit losses on securities that had an allowance recorded in a previous period — ( 458 ) — Write-offs charged against the allowance 124 — Reductions for securities sold 654 — — Ending allowance for credit losses — ( 654 ) ( 320 ) 83 Table of Contents The following table summarizes the components of our total gain (loss) on investments, net for the years ended December 31, 2025, 2024 and 2023. Years Ended December 31, $ in thousands 2025 2024 2023 Gross realized gains on sale of MBS 6,474 7,032 5,363 Gross realized losses on sale of MBS ( 8,891 ) ( 16,156 ) ( 163,391 ) Net unrealized gains (losses) on MBS accounted for under the fair value option 151,761 ( 124,329 ) 50,364 Net unrealized gains (losses) on U.S. Treasury securities — ( 372 ) 372 Net realized gains (losses) on U.S. Treasury securities — ( 86 ) 12 Total gain (loss) on investments, net 149,344 ( 133,911 ) ( 107,280 ) The following tables present components of interest income recognized on our mortgage-backed and other securities portfolio for the years ended December 31, 2025, 2024 and 2023. For the Year ended December 31, 2025 $ in thousands Coupon Interest Net (Premium Amortization)/ Discount Accretion Interest Income Agency RMBS 255,075 ( 1,726 ) 253,349 Agency CMBS 40,540 444 40,984 Non-Agency CMBS 77 — 77 Non-Agency RMBS 296 ( 12 ) 284 Other (inclusive of interest earned on cash balances) 593 — 593 Total 296,581 ( 1,294 ) 295,287 For the Year ended December 31, 2024 $ in thousands Coupon Interest Net (Premium Amortization)/Discount Accretion Interest Income Agency RMBS 258,864 4,948 263,812 Agency CMBS 19,259 433 19,692 Non-Agency CMBS 498 496 994 Non-Agency RMBS 1,080 ( 410 ) 670 U.S. Treasury securities 22 ( 1 ) 21 Other (inclusive of interest earned on cash balances) 1,357 — 1,357 Total 281,080 5,466 286,546 For the Year ended December 31, 2023 $ in thousands Coupon Interest Net (Premium Amortization)/Discount Accretion Interest Income Agency RMBS 266,193 5,160 271,353 Non-Agency CMBS 1,597 1,101 2,698 Non-Agency RMBS 1,132 ( 479 ) 653 U.S. Treasury securities 31 291 322 Other (inclusive of interest earned on cash balances) 2,903 — 2,903 Total 271,856 6,073 277,929 84 Table of Contents Note 4 – Borrowings We finance the majority of our investment portfolio through repurchase agreements. Our repurchase agreements bear interest at a contractually agreed upon rate and generally have maturities ranging from one to six months . We account for our repurchase agreements as secured borrowings since we maintain effective control of the financed assets. Our repurchase agreements are subject to certain financial covenants. We were in compliance with all of these covenants as of December 31, 2025 and 2024. The following table summarizes certain characteristics of our borrowings as of December 31, 2025 and 2024. Refer to Note 5 - “Collateral Positions” for collateral pledged and held under our repurchase agreements. As of December 31, 2025 December 31, 2024 $ in thousands Amount Outstanding Weighted Average Interest Rate Weighted Average Remaining Maturity (days) Amount Outstanding Weighted Average Interest Rate Weighted Average Remaining Maturity (days) Repurchase agreements - Agency RMBS 4,758,568 4.04 % 24 4,112,219 4.80 % 29 Repurchase agreements - Agency CMBS 860,687 4.04 % 20 781,739 4.77 % 32 Total borrowings 5,619,255 4.04 % 23 4,893,958 4.80 % 29 Note 5 – Collateral Positions The following table summarizes the fair value of collateral that we pledged and held under our repurchase agreements and derivative instruments as of December 31, 2025 and 2024. Refer to Note 2 - “Summary of Significant Accounting Policies - Fair Value Measurements” for a description of how we determine fair value. Agency RMBS and Agency CMBS collateral pledged is included in mortgage-backed securities on our consolidated balance sheets. Cash collateral pledged on centrally cleared interest rate swaps and U.S. Treasury futures contracts is classified as restricted cash on our consolidated balance sheets. Cash collateral pledged on TBAs accounted for as derivatives is classified as due from counterparties on our consolidated balance sheets. Cash collateral held that is not restricted for use is included in cash and cash equivalents on our consolidated balance sheets and the liability to return the collateral is included in collateral held payable. Non-cash collateral held is only recognized if the counterparty defaults or if we sell the pledged collateral. As of December 31, 2025 and 2024, we did not hold any cash or non-cash collateral. $ in thousands As of Collateral pledged December 31, 2025 December 31, 2024 Repurchase agreements: Agency RMBS 4,981,189 4,323,626 Agency CMBS 898,129 805,860 Total repurchase agreements collateral pledged 5,879,318 5,129,486 Derivative instruments: Cash — 580 Restricted cash 110,391 137,478 Total derivative instruments collateral pledged 110,391 138,058 Total collateral pledged: Mortgage-backed securities 5,879,318 5,129,486 Cash — 580 Restricted cash 110,391 137,478 Total collateral pledged 5,989,709 5,267,544 85 Table of Contents Repurchase Agreements Collateral pledged with our repurchase agreement counterparties is segregated in our books and records. The repurchase agreement counterparties have the right to resell and repledge the collateral posted but have the obligation to return the pledged collateral, or substantially the same collateral if agreed to by us, upon maturity of the repurchase agreement. Under the repurchase agreements, the respective lender retains the contractual right to mark the underlying collateral to fair value. We would be required to provide additional collateral to fund margin calls if the value of pledged assets declined. We intend to maintain a level of liquidity that will enable us to meet any reasonably anticipated margin calls. The ratio of our total repurchase agreements collateral pledged to our total repurchase agreements outstanding was 105 % as of December 31, 2025 (December 31, 2024: 105 %) based on the fair value of the securities as reported in our consolidated balance sheets. Interest Rate Swaps As of December 31, 2025 and 2024, all of our interest rate swaps were centrally cleared by the Chicago Mercantile Exchange (“CME”), a registered clearing organization, through a Futures Commission Merchant (“FCM”). We are required to pledge initial margin and daily variation margin for our centrally cleared interest rate swaps that is based on the fair value of our contracts as determined by our FCM. Collateral pledged with our FCM is segregated in our books and records and can be in the form of cash or securities. Daily variation margin for centrally cleared interest rate swaps is characterized as settlement of the derivative itself rather than collateral and is recorded as gain (loss) on derivative instruments, net in our consolidated statements of operations. Certain of our FCM agreements include cross default provisions. U.S. Treasury Futures Contracts We are required to pledge initial margin and daily variation margin for our U.S. Treasury futures contracts that is based on the fair value of our contracts as determined by our FCM. The daily variation margin payment for our U.S. Treasury futures contracts is characterized as settlement of the U.S. Treasury futures contract itself rather than collateral and is recorded as gain (loss) on derivative instruments, net in our consolidated statement of operations. TBAs Our TBAs provide for bilateral collateral pledging based on market value as determined by our counterparties. Collateral pledged with our TBA counterparties is segregated in our books and records and can be in the form of cash or securities. Our counterparties have the right to repledge the collateral posted and have the obligation to return the pledged collateral, or substantially the same collateral, if agreed to by us, as the market value of the contracts changes. Note 6 – Derivatives and Hedging Activities Risk Management Objective of Using Derivatives We are exposed to certain risks arising from both our business operations and economic conditions. We principally manage our exposures to a wide variety of business and operational risks through management of our core business activities. We manage economic risks, including interest rate, liquidity and credit risk primarily by managing the amount, sources, and duration of our investments, borrowings, and the use of derivative financial instruments. Specifically, we use derivative financial instruments to manage exposures that arise from business activities that result in the receipt or payment of future known and uncertain cash amounts, the value of which are determined by interest rates. Our derivative financial instruments are used to manage differences in the amount, timing, and duration of our known or expected cash receipts and our known or expected cash payments principally related to our investments and borrowings. The following table summarizes changes in the notional amount of our derivative instruments during 2025. $ in thousands Notional Amount as of December 31, 2024 Additions Settlement, Termination, Expiration or Exercise Notional Amount as of December 31, 2025 Interest rate swaps 3,265,000 1,345,000 ( 790,000 ) 3,820,000 U.S. Treasury futures contracts 1,402,000 5,632,000 ( 5,944,000 ) 1,090,000 TBA purchase contracts 100,000 2,556,700 ( 2,656,700 ) — TBA sale contracts ( 100,000 ) ( 2,556,700 ) 2,656,700 — Refer to Note 5 - “Collateral Positions” for further information regarding our collateral pledged to and received from our derivative counterparties. 86 Table of Contents Interest Rate Swaps At each settlement date, we typically refinance each repurchase agreement at the market interest rate at that time. Our objectives in using interest rate derivatives are to manage our exposures to interest rate movements and to add stability to our borrowings costs. To accomplish these objectives, we primarily use interest rate swaps and U.S. Treasury futures contracts as part of our interest rate risk management strategy. Under the terms of our interest rate swap contracts, we make fixed-rate payments to a counterparty in exchange for the receipt of floating-rate amounts over the life of the agreements without exchange of the underlying notional amount. To a lesser extent, we have in the past entered into and may in the future enter into interest rate swap contracts whereby we make floating-rate payments to a counterparty in exchange for the receipt of fixed-rate amounts as part of our overall risk management strategy. In 2013, we discontinued cash flow hedge accounting for our interest rate swaps. Amounts recorded in accumulated other comprehensive income before we discontinued cash flow hedge accounting for our interest rate swaps were reclassified to interest expense on the consolidated statements of operations as interest was accrued and paid on the related repurchase agreements over the remaining life of the interest rate swap agreements. We reclassified $ 10.4 million as a decrease to interest expense during the year ended December 31, 2023. As of December 31, 2025 and 2024, there were no gains or losses on discontinued cash flow hedges remaining in accumulated other comprehensive income. As of December 31, 2025 and 2024, we had interest rate swaps whereby we pay fixed interest rates and receive floating interest rates based on the secured overnight financing rate (“SOFR”) with the following maturities outstand ing . $ in thousands As of December 31, 2025 Maturities Notional Amount Weighted Average Fixed Pay Rate Weighted Average Floating Receive Rate Weighted Average Years to Maturity Less than 3 years 2,155,000 1.21 % 3.87 % 1.4 3 to 5 years 950,000 0.54 % 3.87 % 4.6 7 to 10 years 305,000 4.12 % 3.87 % 9.1 Greater than 10 years 410,000 1.83 % 3.87 % 17.9 Total 3,820,000 1.34 % 3.87 % 4.6 $ in thousands As of December 31, 2024 Maturities Notional Amount Weighted Average Fixed Pay Rate Weighted Average Floating Receive Rate Weighted Average Years to Maturity Less than 3 years 1,730,000 1.06 % 4.49 % 2.2 3 to 5 years 375,000 0.39 % 4.49 % 4.3 5 to 7 years 750,000 0.57 % 4.49 % 5.8 Greater than 10 years 410,000 1.83 % 4.49 % 18.9 Total 3,265,000 0.97 % 4.49 % 5.3 U.S. Treasury Futures Contracts We use U.S. Treasury futures contracts to help mitigate the potential impact of changes in interest rates on our performance. The table below presents certain details of our U.S. Treasury futures contracts as of December 31, 2025 and 2024. As of $ in thousands December 31, 2025 December 31, 2024 Notional Amount - Short Notional Amount - Short 10 year U.S. Treasury futures 420,000 136,000 Ultra 10 year U.S. Treasury futures 455,000 1,057,000 30 year U.S. Treasury futures 215,000 209,000 Total 1,090,000 1,402,000 87 Table of Contents TBAs TBAs are forward contracts for the purchase or sale of Agency RMBS that specify the price, issuer, term and coupon of the securities to be delivered, but the actual securities are not identified until shortly before the TBA settlement date. Our primary use of TBAs that we do not intend to physically settle has been in long positions as an alternative means of investing in and financing Agency RMBS. During the second quarter of 2025, we used short positions in TBAs to manage risk and economically hedge a portion of our exposure to changes in Agency RMBS valuations. The table below presents certain characteristics of our TBAs accounted for as derivatives as of December 31, 2024. We did not have any TBAs outstanding as of December 31, 2025. $ in thousands As of December 31, 2024 Notional Amount Implied Cost Basis Implied Market Value Net Carrying Value - Asset (Liability) (1) TBA purchase contracts 100,000 99,800 99,173 ( 627 ) TBA sale contracts ( 100,000 ) ( 99,194 ) ( 99,173 ) 21 Net TBA derivatives — 606 — ( 606 ) (1) Derivative assets and derivative liabilities related to TBAs are presented gross on the consolidated balance sheets. Tabular Disclosure of the Effect of Derivative Instruments on the Balance Sheets The table below presents the fair value of our derivative financial instruments, as well as their classification on our consolidated balance sheets as of December 31, 2025 and 2024. $ in thousands Derivative Assets Derivative Liabilities As of As of December 31, 2025 December 31, 2024 December 31, 2025 December 31, 2024 Balance Sheet Fair Value Fair Value Balance Sheet Fair Value Fair Value Interest rate swaps asset 2,235 1,549 Interest rate swaps liability — — U.S. Treasury futures contracts 2,177 3,463 U.S. Treasury futures contracts — — TBAs — 21 TBAs — 627 Total derivative assets 4,412 5,033 Total derivative liabilities — 627 Tabular Disclosure of the Effect of Derivative Instruments on the Income Statement The following tables summarize the effect of interest rate swaps, U.S. Treasury futures contracts, TBAs and currency forward contracts reported in gain (loss) on derivative instruments, net on the consolidated statements of operations for the years ended December 31, 2025, 2024 and 2023. $ in thousands Year ended December 31, 2025 Derivatives Not Designated as Hedging Instruments Realized Gain (Loss) on Derivative Instruments, Net Contractual Net Interest Income (Expense) Unrealized Gain (Loss), Net Gain (Loss) on Derivative Instruments, Net Interest rate swaps ( 162,830 ) 112,244 686 ( 49,900 ) U.S. Treasury futures contracts ( 56,313 ) — ( 1,286 ) ( 57,599 ) TBAs 1,967 — 606 2,573 Total ( 217,176 ) 112,244 6 ( 104,926 ) 88 Table of Contents $ in thousands Year ended December 31, 2024 Derivatives Not Designated as Hedging Instruments Realized Gain (Loss) on Derivative Instruments, Net Contractual Net Interest Income (Expense) Unrealized Gain (Loss), Net Gain (Loss) on Derivative Instruments, Net Interest rate swaps ( 47,581 ) 161,762 610 114,791 U.S. Treasury futures contracts 58,000 — 3,463 61,463 TBAs 986 — ( 606 ) 380 Total 11,405 161,762 3,467 176,634 $ in thousands Year ended December 31, 2023 Derivatives Not Designated as Hedging Instruments Realized Gain (Loss) on Derivative Instruments, Net Contractual Net Interest Income (Expense) Unrealized Gain (Loss), Net Gain (Loss) on Derivative Instruments, Net Interest rate swaps ( 177,628 ) 239,008 918 62,298 Currency forward contracts ( 18 ) — — ( 18 ) TBAs ( 1,880 ) — 1,438 ( 442 ) Total ( 179,526 ) 239,008 2,356 61,838 Note 7 – Offsetting Assets and Liabilities Certain of our repurchase agreements and derivative transactions are governed by underlying agreements that generally provide for a right of offset under master netting arrangements (or similar agreements) in the event of default or in the event of bankruptcy of either party to the transactions. Assets and liabilities subject to such arrangements are presented on a gross basis in the consolidated balance sheets. The following tables present information about the assets and liabilities that are subject to master netting arrangements (or similar agreements) and can potentially be offset on our consolidated balance sheets as of December 31, 2025 and December 31, 2024. The daily variation margin payments for centrally cleared interest rate swaps and U.S. Treasury futures contracts are characterized as settlement of the derivative itself rather than collateral. Our derivative assets of $ 2.2 million related to centrally cleared interest rate swaps and $ 2.2 million related to U.S. Treasury futures contracts as of December 31, 2025 (December 31, 2024: assets of $ 1.5 million and $ 3.5 million related to centrally cleared interest rate swaps and U.S. Treasury futures contracts, respectively) are not included in the table below as a result of this characterization of daily variation margin. As of December 31, 2025 Gross Amounts Not Offset in the Consolidated Balance Sheets $ in thousands Gross Amounts of Recognized Assets (Liabilities) Gross Amounts Offset in the Consolidated Balance Sheets Net Amounts of Assets (Liabilities) Presented in the Consolidated Balance Sheets Financial Instruments Cash Collateral (Received) Pledged Net Amount Liabilities Repurchase agreements (1) ( 5,619,255 ) — ( 5,619,255 ) 5,619,255 — — Total liabilities ( 5,619,255 ) — ( 5,619,255 ) 5,619,255 — — 89 Table of Contents As of December 31, 2024 Gross Amounts Not Offset in the Consolidated Balance Sheets $ in thousands Gross Amounts of Recognized Assets (Liabilities) Gross Amounts Offset in the Consolidated Balance Sheets Net Amounts of Assets (Liabilities) Presented in the Consolidated Balance Sheets Financial Instruments Cash Collateral (Received) Pledged Net Amount Assets Derivatives (2) (3) 21 — 21 — — 21 Total assets 21 — 21 — — 21 Liabilities Derivatives (2) (3) ( 627 ) — ( 627 ) — 580 ( 47 ) Repurchase agreements (1) ( 4,893,958 ) — ( 4,893,958 ) 4,893,958 — — Total liabilities ( 4,894,585 ) — ( 4,894,585 ) 4,893,958 580 ( 47 ) (1) The fair value of securities pledged against our borrowings under repurchase agreements was $ 5.9 billion as of December 31, 2025 (December 31, 2024: $ 5.1 billion). We held no cash collateral under repurchase agreements as of December 31, 2025 or December 31, 2024. Gross amounts not offset are limited to the net amount of repurchase agreement liabilities presented sufficient to reduce the net amount to zero for each counterparty. (2) Amounts represent derivative assets and derivative liabilities which could potentially be offset against other derivative assets, derivative liabilities and cash collateral pledged or received. (3) Cash collateral pledged by us on our derivatives was $ 110.4 million as of December 31, 2025 (December 31, 2024: $ 138.1 million) of which $ 110.4 million relates to initial margin pledged on centrally cleared interest rate swaps and U.S. Treasury futures contracts (December 31, 2024: $ 137.5 million). Centrally cleared interest rate swaps and U.S. Treasury futures contracts are excluded from the tables above. We held no cash collateral on our derivatives as of December 31, 2025 or December 31, 2024. Note 8 – Fair Value of Financial Instruments A three-level valuation hierarchy exists for disclosure of fair value measurements based upon the transparency of inputs to the valuation of an asset or liability as of the measurement date. Observable inputs reflect readily obtainable data from independent sources, while unobservable inputs reflect our market assumptions. The three levels are defined as follows: • Level 1 Inputs – Quoted prices for identical instruments in active markets. • Level 2 Inputs – Quoted prices for similar instruments in active markets; quoted prices for identical or similar instruments in markets that are not active; and model-derived valuations whose inputs are observable or whose significant value drivers are observable. • Level 3 Inputs – Instruments with primarily unobservable value drivers. The following tables present our assets and liabilities measured at fair value on a recurring basis. As of December 31, 2025 Fair Value Measurements Using: $ in thousands Level 1 Level 2 Level 3 Total at Fair Value Assets: Mortgage-backed securities (1) — 6,276,609 — 6,276,609 Derivative assets (2) 2,177 2,235 — 4,412 Total assets 2,177 6,278,844 — 6,281,021 90 Table of Contents As of December 31, 2024 Fair Value Measurements Using: $ in thousands Level 1 Level 2 Level 3 Total at Fair Value Assets: Mortgage-backed securities (1) — 5,445,508 — 5,445,508 Derivative assets (2) 3,463 1,570 — 5,033 Total assets 3,463 5,447,078 — 5,450,541 Liabilities: Derivative liabilities (2) — 627 — 627 Total liabilities — 627 — 627 (1) For more detail about the fair value of our MBS, refer to Note 3 - “Mortgage-Backed Securities”. (2) Derivative assets and derivative liabilities include U.S. Treasury futures contracts as Level 1 measurements and interest rate swaps and TBAs as Level 2 measurements. The following table presents the carrying value and estimated fair value of our financial instruments that are not carried at fair value on the consolidated balance sheets as of December 31, 2025 and December 31, 2024. As of December 31, 2025 December 31, 2024 $ in thousands Carrying Value Estimated Fair Value Carrying Value Estimated Fair Value Financial liabilities: Repurchase agreements 5,619,255 5,619,716 4,893,958 4,895,017 Total 5,619,255 5,619,716 4,893,958 4,895,017 The estimated fair value of repurchase agreements is a Level 3 fair value measurement based on an expected present value technique. This method discounts future estimated cash flows using rates we determined best reflect current market interest rates that would be offered for repurchase agreements with similar characteristics and credit quality. Note 9 – Related Party Transactions Our Manager is at all times subject to the supervision and oversight of our board of directors and has only such functions and authority as we delegate to it. Under the terms of our management agreement, our Manager and its affiliates provide us with our management team, including our officers and appropriate support personnel. Each of our officers is an employee of our Manager or one of its affiliates. We do not have any employees. Our Manager is not obligated to dedicate any of its employees exclusively to us, nor is our Manager obligated to dedicate any specific portion of time to our business. The costs of support personnel provided by our Manager reimbursed or reimbursable by us for the year ended December 31, 2025 were $ 1.2 million (2024: $ 1.5 million; 2023: $ 1.6 million). When cash collateral is received from counterparties under repurchase agreement borrowings, it is generally invested in a money market fund for which our Manager serves as the investment adviser. These investments are included in cash and cash equivalents and the liability to return the collateral is included in collateral held payable on our consolidated balance sheets. Management Fee We pay our Manager a fee equal to 1.50 % of our stockholders' equity per annum. For purposes of calculating the management fee, stockholders' equity is calculated as average month-end stockholders' equity for the prior calendar quarter as determined in accordance with U.S. GAAP. Stockholders' equity may exclude one-time events due to changes in U.S. GAAP and certain non-cash items upon approval by a majority of our independent directors. During the periods presented in these consolidated financial statements, we did not pay any management fees on our investments in unconsolidated ventures that were managed by an affiliate of our Manager. 91 Table of Contents Expense Reimbursement We are required to reimburse our Manager for operating expenses incurred on our behalf, including directors and officers insurance, accounting services, auditing and tax services, legal services, filing fees, and miscellaneous general and administrative costs. Our reimbursement obligation is not subject to any dollar limitation. The following table summarizes the costs incurred on our behalf by our Manager for the years ended December 31, 2025, 2024 and 2023. Years ended December 31, $ in thousands 2025 2024 2023 Incurred costs, prepaid or expensed 6,033 6,617 6,963 Incurred costs, charged or expected to be charged against equity as a cost of raising capital 170 365 257 Total incurred costs, originally paid by our Manager 6,203 6,982 7,220 Termination Fee If we elect to terminate our management agreement other than for cause, we owe our Manager a termination fee equal to three times the sum of our average annual management fee during the 24 -month period before termination, calculated as of the end of the most recently completed fiscal quarter. Note 10 – Stockholders’ Equity Preferred Stock In May 2022, our board of directors approved a share repurchase program for our Series B and Series C Preferred Stock. During the year ended December 31, 2025, we repurchased and retired 352,528 shares of Series C Preferred Stock. During the year ended December 31, 2024, we repurchased and retired 138,008 shares of Series B Preferred Stock prior to redemption and 338,780 shares of Series C Preferred Stock. As of December 31, 2025, we had authority to repurchase 354,131 additional shares of our Series C Preferred Stock under the current preferred stock share repurchase program. On December 27, 2024, we redeemed all issued and outstanding shares of our Series B Preferred Stock for $ 106.2 million. The cash redemption price for each share of Series B Preferred Stock was $ 25.00 . The excess of the consideration transferred over carrying value was accounted for as a deemed dividend and resulted in a reduction of $ 3.5 million in net income attributable to common stockholders for the year ended December 31, 2024. Prior to redemption, holders of our Series B Preferred Stock were entitled to receive dividends at an annual rate of 7.75 % of the liquidation preference of $ 25.00 per share or $ 1.9375 per share per annum. Dividends were cumulative and payable quarterly in arrears. Holders of our Series C Preferred Stock are entitled to receive dividends at an annual rate of 7.50 % of the liquidation preference of $ 25.00 per share or $ 1.875 per share per annum until September 27, 2027. After September 27, 2027, holders are entitled to receive dividends at a floating rate equal to three-month CME Term SOFR and the applicable credit spread adjustment ( 0.26161 %) plus a spread of 5.289 % of the $ 25.00 liquidation preference per annum. Dividends are cumulative and payable quarterly in arrears. We have the option to redeem shares of our Series C Preferred Stock on or after September 27, 2027 for $ 25.00 per share, plus any accumulated and unpaid dividends through the date of the redemption. Shares of Series C Preferred Stock are not redeemable, convertible into or exchangeable for any other property or any other securities of the Company before that time, except under circumstances intended to preserve our qualification as a REIT or upon the occurrence of a change in control. 92 Table of Contents Common Stock As of December 31, 2025, we had 19,538,020 shares of our common stock remaining available for sale from time to time in at-the-market or privately negotiated transactions under our equity distribution agreement with placement agents. These shares are registered with the SEC under our shelf registration statement (as amended and/or supplemented). The table below shows issuances of our common stock under equity distribution agreements during the years ended December 31, 2025 and 2024. Years ended December 31, Shares in ones, $ in thousands 2025 2024 Shares sold 9,983,179 13,204,968 Fees paid to placement agents 1,034 1,475 Cash proceeds, net of fees paid to placement agents 81,625 116,460 During the years ended December 31, 2025 and 2024, we did not repurchase any shares of our common stock. As of December 31, 2025, we had authority to repurchase 1,816,359 shares of our common stock through our common stock share repurchase program. During the year ended December 31, 2025, we granted 77,108 restricted shares of common stock, net of forfeitures due to retirement, to our independent directors (2024: 64,969 restricted shares; 2023: 45,567 restricted shares). Restricted shares become unrestricted shares of common stock on the first anniversary of the grant date unless forfeited, subject to certain conditions that accelerate vesting. Accumulated Other Comprehensive Income Changes in the balance of our accumulated other comprehensive income during the years ended December 31, 2025 and 2024 related solely to gains and losses on MBS that were not accounted for under the fair value option. The following table presents the components of total other comprehensive income (loss) and accumulated other comprehensive income for 2023. Year ended December 31, 2023 $ in thousands Equity Method Investments Available-for-sale Securities Derivatives and Hedging Total Total other comprehensive income (loss) Unrealized gain (loss) on mortgage-backed securities, net — ( 91 ) — ( 91 ) Reclassification of unrealized loss on available-for-sale securities to (increase) decrease in provision for credit losses — 320 — 320 Reclassification of amortization of net deferred (gain) loss on de-designated interest rate swaps to repurchase agreements interest expense — — ( 10,405 ) ( 10,405 ) Currency translation adjustments on investment in unconsolidated venture ( 10 ) — — ( 10 ) Reclassification of currency translation loss on investment in unconsolidated venture to other investment income (loss), net 123 — — 123 Total other comprehensive income (loss) 113 229 ( 10,405 ) ( 10,063 ) AOCI balance at beginning of period ( 113 ) 469 10,405 10,761 Total other comprehensive income (loss) 113 229 ( 10,405 ) ( 10,063 ) AOCI balance at end of period — 698 — 698 Amounts recorded in AOCI before we discontinued cash flow hedge accounting for our interest rate swaps were reclassified to interest expense on the consolidated statements of operations as interest was accrued and paid on the related repurchase agreements over the remaining original life of the interest rate swap agreements. 93 Table of Contents Dividends The table below summarizes the dividends we declared during 2025 and 2024. All dividends are characterized as ordinary income in the fiscal tax year in which they were declared. $ in thousands, except per share amounts Dividends Declared Series B Preferred Stock Per Share In Aggregate Date of Payment 2024 November 4, 2024 0.4844 2,058 December 27, 2024 August 7, 2024 0.4844 2,058 September 27, 2024 May 7, 2024 0.4844 2,058 June 27, 2024 February 21, 2024 0.4844 2,086 March 27, 2024 $ in thousands, except per share amounts Dividends Declared Series C Preferred Stock Per Share In Aggregate Date of Payment 2025 November, 4, 2025 0.46875 3,221 December 29, 2025 August 7, 2025 0.46875 3,261 September 29, 2025 May 6, 2025 0.46875 3,297 June 27, 2025 February 19, 2025 0.46875 3,341 March 27, 2025 2024 November 4, 2024 0.46875 3,386 December 27, 2024 August 7, 2024 0.46875 3,416 September 27, 2024 May 7, 2024 0.46875 3,450 June 27, 2024 February 21, 2024 0.46875 3,499 March 27, 2024 $ in thousands, except per share amounts Dividends Declared Common Stock Per Share In Aggregate Date of Payment 2025 December 18, 2025 0.36 25,845 January 23, 2026 September 24, 2025 0.34 24,121 October 24, 2025 June 24, 2025 0.34 22,545 July 25, 2025 March 25, 2025 0.34 22,420 April 25, 2025 2024 December 19, 2024 0.40 24,692 January 24, 2025 September 24, 2024 0.40 24,292 October 25, 2024 June 24, 2024 0.40 20,255 July 26, 2024 March 26, 2024 0.40 19,530 April 26, 2024 94 Table of Contents Note 11 – Earnings (Loss) per Common Share Earnings (loss) per share for the years ended December 31, 2025, 2024 and 2023 is calculated as follows. In thousands except per share amounts Years Ended December 31, 2025 2024 2023 Numerator (income) Basic earnings: Net income (loss) available to common stockholders 88,173 34,763 ( 37,541 ) Denominator (weighted average shares) Basic earnings: Shares available to common stockholders 66,882 53,773 44,074 Effect of dilutive securities: Restricted stock awards 2 2 — Dilutive shares 66,884 53,775 44,074 Earnings (loss) per share: Net income (loss) attributable to common stockholders Basic 1.32 0.65 ( 0.85 ) Diluted 1.32 0.65 ( 0.85 ) There were no antidilutive shares that were excluded from the calculation of diluted earnings per share during the years ended December 31, 2025 and 2024 (December 31, 2023: 944 shares excluded related to restricted stock awards). Note 12 - Segment Information We manage our operations on a consolidated basis and our investment strategy and management approach are focused on allocating resources and assessing the performance of our investment portfolio in total. Accordingly, we have a single operating segment. We generate interest income on our investments in MBS and other real estate-related assets. The majority of our investments are fixed-rate Agency MBS with principal and interest that are guaranteed by a U.S. government agency or a federally chartered corporation. All of our interest income and assets are attributed to the United States. Our chief operating decisions makers (“CODMs”) are our officers that serve as members of our investment committee, which includes our Chief Executive Officer, Chief Investment Officer, Chief Operating Officer, Chief Financial Officer and President. The CODMs use net income (loss) to assess performance and make decisions about capital allocation and our portfolio composition, including our allocation to certain investment types, amount of borrowings and hedging activities. The accounting policies of the segment are the same as those described in Note 2 “Summary of Significant Accounting Policies”. Total segment net income (loss) and total segment assets are the same as total net income (loss) and total assets as reported on our consolidated statements of operations and consolidated balance sheets, respectively. We regularly report interest expense, management fees and general and administrative expenses as separately presented on our consolidated statements of operations to our CODMs. Note 13 – Commitments and Contingencies Commitments and contingencies may arise in the ordinary course of business. As of December 31, 2025, we were not aware of any reported or unreported contingencies. 95 Table of Contents Note 14 – Subsequent Events Common Stock Issuances Between January 1, 2026 and February 23, 2026, we issued 11,480,000 shares of common stock in at-the-market transactions under our equity distribution agreement with placement agents for cash proceeds, net of fees paid to placement agents, of $ 98.7 million. Dividends On January 15, 2026, we declared a common stock dividend of $ 0.12 per share paid on February 13, 2026 to stockholders of record at the close of business on January 26, 2026. On February 13, 2026, we declared a common stock dividend of $ 0.12 per share payable on March 13, 2026 to stockholders of record at the close of business on February 24, 2026. On February 18, 2026, we declared a Series C Preferred Stock dividend of $ 0.46875 per share payable on March 27, 2026 to our stockholders of record at the close of business on March 5, 2026. 96 Table of Contents SIGNATURES Pursuant to the requirements of Section 13 or 15(d) of the Securities Exchange Act of 1934, the registrant has duly caused this Report to be signed on its behalf by the undersigned, thereunto duly authorized. Invesco Mortgage Capital Inc. By: /s/ John M. Anzalone John M. Anzalone Chief Executive Officer Date: February 23, 2026 Pursuant to the requirements of the Securities Exchange Act of 1934, this Report has been signed below by the following persons on behalf of the registrant and in the capacities and on the dates indicated. Signatures Title Date By: /s/ John M. Anzalone Chief Executive Officer February 23, 2026 John M. Anzalone (principal executive officer) By: /s/ Mark Gregson Chief Financial Officer February 23, 2026 Mark Gregson (principal financial officer) By: /s/ Stephanie Botha Chief Accounting Officer February 23, 2026 Stephanie Botha (principal accounting officer) By: /s/ Don H. Liu Chairperson and Director February 23, 2026 Don H. Liu By: /s/ Robert L. Fleshman Director February 23, 2026 Robert L. Fleshman By: /s/ Carolyn Gibbs Director February 23, 2026 Carolyn Gibbs By: /s/ Carolyn B. Handlon Director February 23, 2026 Carolyn B. Handlon By: /s/ Katharine W. Kelley Director February 23, 2026 Katharine W. Kelley By: /s/ Wes McMullan Director February 23, 2026 Wes McMullan By: /s/ Robert Waldner Director February 23, 2026 Robert Waldner 97