Quarterly report pursuant to Section 13 or 15(d)

Consolidated Statements of Cash Flows (Unaudited)

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Consolidated Statements of Cash Flows (Unaudited) (USD $)
In Thousands
 6 Months Ended
Jun. 30, 2011
Jun. 30, 2010
Cash Flows From Operating Activities    
Net income $ 208,808 $ 259,779
Adjustments to reconcile net income to net cash provided by (used in) operating activities (inclusive of amounts related to discontinued operations):    
Depreciation and amortization 137 125
Accretion of discount and other amortization (21,807) (8,377)
Interest income in CDOs redirected for reinvestment or CDO bonds paydown (6,579) (12,705)
Interest income on investments accrued to principal balance (9,298) (3,789)
Interest expense on debt accrued to principal balance 514 1,645
Deferred interest received 1,027 44
Non-cash directors' compensation 122 60
Reversal of valuation allowance on loans (55,862) (187,308)
Other-than-temporary impairment on securities 9,589 76,781
Impairment on real estate held for sale 433 60
Gain on settlement of investments, net (68,766) (18,631)
Unrealized loss on non-hedge derivatives and hedge ineffectiveness 11,194 4,299
Gain on extinguishment of debt (44,485) (95,074)
Change in:    
Restricted cash 245 3,018
Receivables and other assets 1,076 2,967
Due to affiliates 99 (78)
Accrued expenses and other liabilities (73) (1,346)
Net cash provided by (used in) operating activities 26,374 21,470
Cash Flows From Investing Activities    
Purchase of real estate securities (180,245) (2,291)
Proceeds from sale of real estate securities 3,885 26,022
Acquisition of servicing rights (2,268)  
Principal repayments on loans and securities other than third-party CDO 51,933 45,083
Principal repayments on third-party CDO securities 8,865  
Repayments of principal from repurchased CDO debt 48,881 53
Margin received on derivative instruments   5,073
Payments on settlement of derivative instruments (14,322) (11,394)
Distributions of capital from equity method investees   159
Net cash provided by (used in) investing activities (83,271) 62,705
Cash Flows From Financing Activities    
Repurchases of CDO bonds payable (87,064) (9,927)
Issuance of other bonds payable 142,736 97,650
Repayments of other bonds payable (184,242) (124,104)
Borrowings under repurchase agreements 108,576  
Repayments of repurchase agreements (9,263) (71,309)
Issuance of common stock 98,843  
Costs related to issuance of common stock (468)  
Cash consideration paid in exchange for junior subordinated notes   (9,715)
Cash consideration paid to redeem preferred stock   (16,001)
Dividends paid (5,581) (19,484)
Payment of deferred financing costs (1,546) (1,677)
Restricted cash returned from refinancing activities 62,220 39,776
Net cash provided by (used in) financing activities 124,211 (114,791)
Net Increase (Decrease) in Cash and Cash Equivalents 67,314 (30,616)
Cash and Cash Equivalents, Beginning of Period 33,524 68,300
Cash and Cash Equivalents, End of Period 100,838 37,684
Supplemental Disclosure of Cash Flow Information    
Cash paid during the period for interest expense 53,169 65,946
Supplemental Schedule of Non-Cash Investing and Financing Activities    
Common stock dividends declared but not paid 7,930  
Preferred stock dividends declared but not paid 930  
Common stock issued to redeem preferred stock   28,457
Face amount of CDO bonds issued in exchange for previously issued junior subordinated notes of $52,094   37,625
Securities purchased not yet settled $ 85,278