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, unless otherwise specified
 6 Months Ended
Jun. 30, 2012
Jun. 30, 2011
Cash Flows From Operating Activities    
Net income $ 103,910 $ 208,808
Adjustments to reconcile net income to net cash provided by (used in) operating activities (inclusive of amounts related to discontinued operations):    
Depreciation and amortization 174 137
Accretion of discount and other amortization (25,860) (21,807)
Interest income in CDOs redirected for reinvestment or CDO bond paydown (2,445) (6,579)
Interest income on investments accrued to principal balance (10,914) (9,298)
Interest expense on debt accrued to principal balance 218 514
Deferred interest received 0 1,027
Non-cash directors' compensation 220 122
Valuation allowance (reversal) on loans (12,254) (55,862)
Other-than-temporary impairment on securities 13,673 9,589
Impairment on real estate held-for-sale 0 433
Change in fair value of investments in excess mortgage servicing rights (4,739) 0
Gain on settlement of investments (net) and real estate held-for-sale (3,646) (68,766)
Unrealized (gain) loss on non-hedge derivatives and hedge ineffectiveness 2,476 11,194
Gain on extinguishment of debt (20,782) (44,485)
Change in:    
Restricted cash 364 245
Receivables and other assets (4,371) 1,076
Due to affiliates 334 99
Accrued expenses and other liabilities 2,977 (73)
Net cash provided by (used in) operating activities 39,335 26,374
Cash Flows From Investing Activities    
Principal repayments from repurchased CDO debt 12,567 48,881
Principal repayments from CDO securities 527 8,865
Principal repayments from non-Agency RMBS 4,173 70
Return of investments in excess mortgage servicing rights 4,820 0
Principal repayments from loans and non-CDO securities (excluding non-Agency RMBS) 38,115 51,863
Purchase of real estate securities (227,670) (180,245)
Proceeds from sale of real estate securities 0 3,885
Acquisition of investments in excess mortgage servicing rights (190,510) 0
Acquisition of servicing rights 0 (2,268)
Deposit paid on investment in excess mortgage servicing rights (16,801) 0
Payments on settlement of derivative instruments 0 (14,322)
Net cash provided by (used in) investing activities (374,779) (83,271)
Cash Flows From Financing Activities    
Repurchases of CDO bonds payable (9,177) (87,064)
Issuance of other bonds payable 0 142,736
Repayments of other bonds payable (21,684) (184,242)
Borrowings under repurchase agreements 102,194 108,576
Repayments of repurchase agreements (18,424) (9,263)
Issuance of common stock 268,050 98,843
Costs related to issuance of common stock (621) (468)
Common stock dividends paid (36,813) 0
Preferred stock dividends paid (2,790) (5,581)
Payment of deferred financing costs 0 (1,546)
Restricted cash returned from refinancing activities 0 62,220
Net cash provided by (used in) financing activities 280,735 124,211
Net Increase (Decrease) in Cash and Cash Equivalents (54,709) 67,314
Cash and Cash Equivalents, Beginning of Period 157,356 33,524
Cash and Cash Equivalents, End of Period 102,647 100,838
Supplemental Disclosure of Cash Flow Information    
Cash paid during the period for interest expense 40,390 53,169
Supplemental Schedule of Non-Cash Investing and Financing Activities    
Preferred stock dividends declared but not paid 930 930
Common stock dividends declared but not paid 29,436 7,930
Securities purchased, not yet settled 68,296 85,278
Purchase price payable on investments in excess mortgage servicing rights 31,382 0
Deposit on senior housing assets due to affiliates $ 5,930 $ 0