2020欧洲杯预赛直播

Letter to Stockholders

Dear Fellow Stockholders

Dear Fellow
Stockholders:

As 2019 came to a close, we could not have imagined that at the time we sat down to write this Annual Report we would be facing unprecedented societal and economic conditions as a result of the COVID-19 pandemic. The future holds much uncertainty, and there can be no doubt that our country will have many challenges ahead. With that in mind, I would like to begin this letter by saying that on behalf of the entire senior management team at Two Harbors, we do not take this situation lightly. You have our commitment to remain good stewards of our company, while also being mindful of the health and safety of our people. We will weather this storm and be stronger for having done so together.

So far in 2020, we have encountered significant headwinds due to the extreme volatility in the financial markets. We are fortunate that these challenging times came on the heels of very strong performance in 2019. Our book value at December 31, 2019 was $14.54 per common share compared to $13.11 per common share at December 31, 2018. This represented a 23.6% total annual return on book value(1), which was a substantial positive outlier compared to our peers. Additionally, we generated an annual total stockholder return of 28.7%(2), which is defined as the change in stock price with dividends reinvested.

We believe we have defined a niche within the mortgage REIT market through our strategy of pairing mortgage servicing rights (MSR) with Agency residential mortgage-backed securities (RMBS), as well as utilizing a variety of tools to hedge interest rate and spread exposure. In these uncertain times ahead, we will remain acutely focused on managing our portfolio through thoughtful asset selection, as well as active hedging, to benefit our stockholders over the long-term.

UNWAVERING COMMITMENT TO OUR STAKEHOLDERS:
PEOPLE, STOCKHOLDERS AND COMMUNITIES
We believe that our success as a company is driven by our commitment to serving the interests of all our stakeholders, including our people, stockholders and local communities.

Our people. Our people are the foundation of our company. We have over 120 dedicated professionals across three offices, with our largest office in Minneapolis, Minnesota. To support the development of our people across our organization, we provide leadership development and tuition reimbursement programs, and sponsor diversity and inclusion training in an effort to provide a workplace where all of our people can succeed. Women make up over one third of our workforce and senior leadership team, and our Women’s Initiative focuses on engaging and supporting the personal and professional development of women in our workplace. Additionally, we offer resources to support and promote health and wellness, such as company-wide team wellness challenges and regular company social events. We are proud that our company has been recognized by several publications as a top work place, including the Minneapolis Star Tribune and Minnesota Business Magazine. We take great pride in the unique culture that we have developed at Two Harbors, a community defined by individuals who are extremely talented and driven. It is this spirit that will continue to drive Two Harbors forward.

Our stockholders. We are focused on generating long-term stockholder returns through actively managing our portfolio and risk positioning. We take extra care and effort to ensure that our stockholder disclosures are transparent, straightforward and accessible. In addition to quarterly earnings calls and presentations, we provide periodic webinars, with the goal of sharing in-depth insights on various topics related to our business and the residential mortgage and housing markets. We also host our annual stockholder meetings virtually, so that all of our stockholders can participate fully, and equally, from any location at no cost.

Our communities. We are committed to strengthening our local communities through the support of various charitable organizations, particularly those allied with the housing sector. We provide our people with the chance to give back, through volunteer opportunities with our charitable partners. In the Minneapolis area, some of the largest charities that we partner with include Aeon: Homes for Generations, Twin Cities Habitat for Humanity and Simpson Housing Services.


LONG-TERM TOTAL STOCKHOLDER RETURN FOCUS
Our goal is, and always has been, to protect and grow our book value so that we can continue to drive strong stockholder returns over the long term. We plan to execute on this by focusing on thoughtful asset selection as well as active and sophisticated hedging. We remain committed to serving the interests of all of our stakeholders – our people, business partners, stockholders and communities -- because we know that they are the key to our success.

Thank you for your interest in and support of Two Harbors.

Sincerely,


Thomas E. Siering
President and Chief Executive Officer
1) Return on book value is defined as the increase (decrease) in book value per common share from the beginning to the end of the given period, plus dividends declared in the period, divided by the book value as of the beginning of the period.

2) Two Harbors’ total stockholder return for 2019 is calculated for the period December 31, 2018 through December 31, 2019. Total stockholder return is defined as stock price appreciation including dividends. Source: Bloomberg.