John Anzalone
About John Anzalone
John M. Anzalone is Chief Executive Officer of Invesco Mortgage Capital Inc. (IVR), a role he has held since 2017 after serving as the company’s Chief Investment Officer since inception in 2009. He previously led Invesco Fixed Income’s Structured Securities Portfolio Management (2007–2023) and is a CFA charterholder with a BA in Economics (Hobart College) and an MBA (Simon School, University of Rochester). Age 60; 15 years with IVR as of the 2025 proxy . IVR delivered a 5.2% economic return in 2024 and maintained its dividend amid market volatility, while executing capital structure actions (ATM issuance and preferred redemptions) under management’s oversight .
Past Roles
| Organization | Role | Years | Strategic Impact |
|---|---|---|---|
| Invesco Fixed Income | Senior Portfolio Manager; Head of Structured Securities Portfolio Management | 2007–2023 | Led structured securities strategy across portfolios; member of IFI Investment Strategy team influencing risk positioning and asset allocation . |
| Invesco Fixed Income | Senior Portfolio Manager | 2002–2007 | Portfolio management across RMBS/CMBS/ABS sectors; platform-wide strategy inputs . |
| AgriBank, FCB | Senior Trader | 1994–~2000 (six years) | Senior trading responsibilities across MBS/ABS/CMBS; liquidity and execution in mortgage products . |
| Union Trust | Investment professional | Began 1992 | Entry into fixed income investing; early career development . |
| Advantus Capital Management | Senior Trader | Not disclosed | Traded mortgage-backed, asset-backed and commercial mortgage securities . |
External Roles
No public company directorships or external roles disclosed for Mr. Anzalone in the proxy .
Fixed Compensation
IVR is externally managed and does not directly compensate executive officers. Compensation is paid by Invesco Advisers, Inc. (the external manager) from the management fee; IVR neither pays nor reimburses any executive compensation, and it has no employment agreements with executive officers .
| Component | Structure | Key Details |
|---|---|---|
| Base Salary | Paid by Invesco (manager) | Portion of fixed comp set by Invesco based on role, skills, experience; small share of total comp . |
| IVR Cash Compensation | N/A | IVR pays no cash compensation to executive officers . |
Reference point: IVR estimated the aggregate compensation of all executive officers reasonably associated with managing IVR at $1.09 million for 2024, or 9.3% of IVR’s management fee for 2024 . IVR’s 2024 management fees to the manager were approximately $11.9 million .
Performance Compensation
Incentive compensation is determined and paid by the manager (Invesco), not IVR. Invesco funds annual incentives from its enterprise-wide pool and deploys time-based long-term awards to align with long-term objectives .
| Metric/Vehicle | Weighting | Target | Actual | Payout Mechanism | Vesting |
|---|---|---|---|---|---|
| Investment performance on products managed | Not disclosed | Not disclosed | Not disclosed | Influences annual cash bonus and deferrals | N/A (metric inputs) . |
| Invesco financial results (e.g., revenue/progress vs. strategic objectives) | Not disclosed | Not disclosed | Not disclosed | Funds the Invesco-wide incentive pool | N/A (pool funding) . |
| Qualitative assessment and risk management | Not disclosed | Not disclosed | Not disclosed | Adjusts individual awards | N/A . |
| Invesco annual deferral award (time-based) | N/A | N/A | N/A | Deferred, denominated in Invesco product fund offerings | Time-based vesting; settled in cash . |
| Invesco long-term awards (time-based) | N/A | N/A | N/A | Mix of Invesco equity awards and cash-settled fund units | Time-based vesting . |
| IVR equity awards to executive officers | N/A | N/A | N/A | IVR does not intend to grant equity to its executive officers | N/A . |
Additional policies and signals:
- Clawback: Company maintains a clawback policy, but it does not impact executive officers since IVR pays no incentive compensation to them .
- Say-on-pay: 92% approval at the 2024 annual meeting .
Equity Ownership & Alignment
| Item | Detail |
|---|---|
| Shares owned (3/14/2025) | 8,317 shares of IVR common stock . |
| % of shares outstanding | ~0.013% (8,317 / 65,273,161; shares outstanding as of 3/14/2025) . |
| Vested vs. unvested | Not disclosed for executive officers; IVR does not grant equity to executive officers . |
| Options (exercisable/unexercisable) | None disclosed at IVR-level; no IVR equity awards intended for executive officers . |
| Pledging/Hedging | Prohibited by company policy; policy bans short selling, publicly traded options, pledging and hedging . |
| 10b5-1 plans | Pre-approval and pre-clearance required under insider trading policy . |
| Ownership guidelines (current) | CEO: at least 7,000 shares within five years of later of policy effective date or appointment . |
| Compliance status | As of 3/14/2025, 8,317 shares vs. 7,000-share CEO guideline implies compliance under the current policy . |
| Prior guideline (historical) | 2020 proxy showed higher thresholds: CEO 60,000 shares; President/CIO/COO 35,000; CFO 7,000 . |
Stock ownership of management notes: “No shares are pledged as security,” and each individual executive/director owns less than 1% .
Employment Terms
| Term | Status |
|---|---|
| Employment agreement with IVR | None; executives are employees of the external manager . |
| Severance provisions | None at IVR; IVR does not provide severance to executive officers . |
| Change-of-control | No company-level change-in-control cash or equity acceleration for executive officers (IVR does not grant executive equity; no cash arrangements) . |
| Non-compete / non-solicit / garden leave | Not disclosed in IVR filings for executive officers. |
| Clawback | Maintained by IVR; scope not applicable to executive officers given compensation structure . |
| Management agreement | External manager receives fee = 1.5% of stockholders’ equity; renews annually; manager entitled to termination fee under certain circumstances . |
Compensation Structure Analysis
- Alignment challenges in external model: Executive compensation is determined at Invesco (enterprise-level), not by IVR, and may be driven by multi-product performance and Invesco financials rather than IVR-specific TSR or economic return. IVR explicitly does not pay or grant equity to executive officers .
- Ownership guideline reset: Current CEO guideline (7,000 shares) is materially lower than the 2020 proxy guideline (60,000 shares), reducing the minimum “skin-in-the-game” threshold; current guideline appears satisfied by Mr. Anzalone’s 8,317 shares .
- Minimal insider selling pressure from scheduled vesting: IVR does not grant IVR equity to executive officers, reducing scheduled vest-driven selling; Invesco long-term awards are time-based but are denominated in Invesco equity and product fund units, not IVR stock .
- Strong trading safeguards: Pledging and hedging of IVR stock is prohibited; pre-clearance and 10b5-1 plan pre-approval are required, limiting opportunistic trading risks .
- Shareholder sentiment: Say-on-pay support was high at ~92% in 2024, despite externalized pay structure .
Track Record and Execution Context
- 2024 performance context: IVR produced a 5.2% economic return and maintained its dividend amidst elevated rate volatility; management issued 13.2 million common shares via ATM ($116.2 million net) and reduced preferreds (repurchased 477k and redeemed remaining Series B), lowering preferred’s share of capital structure from 37% to 24% YoY .
Related Party Transactions (Context)
- External management: The management agreement (1.5% of stockholders’ equity) is a related-party arrangement; 2024 management fee was approximately $11.9 million and reimbursed operating expenses were approximately $7.0 million .
- Equity plan: IVR’s equity plan covers non-executive directors and employees of the manager who are not IVR executive officers; IVR “does not intend to grant equity awards” to executive officers .
Compensation Committee & Governance Notes
- While IVR’s Compensation Committee does not set executive officer pay (given the external model), it reviews and discusses the manager’s compensation plan/objectives for alignment with shareholder interests and conflicts .
- Insider trading policy strictly restricts pledging/hedging; executive officer stock ownership policy is in place (CEO 7,000 shares threshold) .
Investment Implications
- Pay-for-performance signaling: Because Mr. Anzalone’s pay is set at the manager level and not directly tied to IVR-specific performance metrics, traditional REIT CEO pay/metric linkages (TSR percentiles, FFO/ROE gates) are less observable for IVR. This can dilute IVR-specific incentive alignment versus internally managed peers .
- Insider selling pressure: Limited, as IVR does not grant executive officers IVR equity; trading is further constrained by pre-clearance and hedging/pledging prohibitions, reducing the risk of forced or opportunistic selling into weakness .
- Alignment via ownership: Mr. Anzalone’s 8,317 shares imply compliance with the current CEO ownership guideline (7,000 shares), though the lower threshold relative to 2020 standards weakens the structural “skin-in-the-game” versus historic policy .
- Retention/change-of-control risk: Absence of IVR-level severance/CIC provisions (and no IVR equity) removes golden parachute overhang but also means retention depends on Invesco’s internal programs. Manager-level incentives and long-term awards are time-based, encouraging retention but not necessarily IVR-specific outperformance .
- Governance trade-off: The external management model (1.5% of stockholders’ equity; termination fee provisions) is the primary economic lever; investor focus should remain on fee economics, capital allocation (e.g., leverage, preferred/common mix), and execution within the Agency RMBS cycle rather than executive pay tweaks, given the structure .