American Capital Agency (NASDAQ:AGNC) reported it had a comprehensive income of $1.18 per share in the first quarter, well ahead of the loss of $0.99 per share in the fourth quarter and the loss of $1.57 in the first quarter of 2013.

In total, comprehensive income at AGNC stood at $420 million in the first quarter. In the prior quarter it reported a loss of $369 million. The biggest reason behind this was the appreciation in value of its securities, as it recognized a gain of $521 million on its available for sale securities, versus a loss of $311 million in the fourth quarter.

"We are pleased to see some stability return to the fixed-income markets," noted the President and CIO of American Capital Agency, Gary Kain, in the earnings announcement. "Against this backdrop, AGNC was able to produce an economic return of just over 5% for the quarter, which equates to 20% on an annualized basis. Additionally, we remain optimistic about the outlook for the agency MBS market as low origination volumes and conservative MBS positioning should compensate for the continued tapering of the Federal Reserve's agency MBS and U.S. Treasury purchases."

Book value at AGNC rose by almost 2.5% to $24.49. This is the first time since the third quarter of 2012 in which it witnessed its net book value increase. The economic return of 5% includes both the increase in book value and the dividends of $0.65 per share.

"2013 was a challenging year for agency mortgage REITs and we are pleased that the significant actions that we took during 2013, from repositioning our portfolio to shrinking our capital base through the repurchase of our common stock, helped drive our performance this quarter and positions us well for the remainder of 2014," added the CEO and Chair of American Capital Agency, Malon Wilkus, to conclude the earnings announcement.

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