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
 9 Months Ended
Sep. 30, 2012
Sep. 30, 2011
Cash Flows From Operating Activities    
Net income $ 377,131 $ 238,751
Adjustments to reconcile net income to net cash provided by (used in) operating activities (inclusive of amounts related to discontinued operations):    
Depreciation and amortization 2,701 225
Accretion of discount and other amortization (38,923) (33,214)
Interest income in CDOs redirected for reinvestment or CDO bond paydown (2,944) (8,981)
Interest income on investments accrued to principal balance (16,759) (14,303)
Interest expense on debt accrued to principal balance 328 619
Payment of deferred interest (568)   
Deferred interest received    1,027
Non-cash directors' compensation 220 122
Valuation allowance (reversal) on loans (8,160) (38,218)
Other-than-temporary impairment on securities 14,593 13,595
Impairment on real estate held-for-sale    433
Change in fair value of investments in excess mortgage servicing rights (6,513)   
Gain on settlement of investments (net) and real estate held-for-sale (232,885) (74,463)
Unrealized (gain) loss on non-hedge derivatives and hedge ineffectiveness 501 14,483
Gain on extinguishment of debt (23,127) (60,402)
Change in:    
Restricted cash 1,741 1,249
Receivables and other assets 1,088 528
Due to affiliates 1,692 113
Accrued expenses and other liabilities 1,618 57
Net cash provided by (used in) operating activities 71,734 41,621
Cash Flows From Investing Activities    
Principal repayments from repurchased CDO debt 21,347 57,108
Principal repayments from CDO securities 1,446 9,834
Principal repayments from non-Agency RMBS 12,440 107
Return of investments in excess mortgage servicing rights 13,327   
Principal repayments from loans and non-CDO securities (excluding non-Agency RMBS) 70,398 65,649
Purchase of real estate securities (597,769) (303,101)
Purchase of real estate loans (9,216)   
Proceeds from sale of investments 127,000 3,885
Acquisition of investments in excess mortgage servicing rights (218,642)   
Acquisition of investments in real estate (141,576)   
Additions to investments in real estate (26)   
Proceeds from sale of real estate held for sale    650
Acquisition of servicing rights    (2,268)
Deposit paid on investments (25,857)   
Payments on settlement of derivative instruments    (14,322)
Net cash provided by (used in) investing activities (747,128) (182,458)
Cash Flows From Financing Activities    
Repurchases of CDO bonds payable (35,695) (91,039)
Issuance of other bonds payable    142,736
Repayments of other bonds payable (33,177) (194,379)
Borrowings under repurchase agreements 407,878 291,818
Repayments of repurchase agreements (42,291) (89,622)
Margin deposits under repurchase agreements (43,960) (8,597)
Return of margin deposits under repurchase agreements 43,447 8,597
Borrowings under mortgage notes payable 88,400   
Issuance of common stock 435,821 211,567
Costs related to issuance of common stock (840) (468)
Common stock dividends paid (66,249) (7,930)
Preferred stock dividends paid (4,185) (6,976)
Payment of deferred financing costs (1,831) (1,581)
Purchase of derivative instruments (244)   
Restricted cash returned from refinancing activities    58,367
Net cash provided by (used in) financing activities 747,074 312,493
Net Increase (Decrease) in Cash and Cash Equivalents 71,680 171,656
Cash and Cash Equivalents, Beginning of Period 157,356 33,524
Cash and Cash Equivalents, End of Period 229,036 205,180
Supplemental Disclosure of Cash Flow Information    
Cash paid during the period for interest expense 59,384 76,730
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 37,947 15,776
Purchase price payable on investments in excess mortgage servicing rights 3,250   
Re-issuance of other bonds and notes payable to third parties upon deconsolidation of CDO $ 29,959 $ 5,751