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, 2013
Sep. 30, 2012
Cash Flows From Operating Activities    
Net income $ 185,442 $ 20,930
Adjustments to reconcile net income to net cash provided by (used in) operating activities (inclusive of amounts related to discontinued operations):    
Change in fair value of investments in excess mortgage servicing rights (43,899) (6,513)
Change in fair value of investments in excess mortgage servicing rights, equity method investees (41,741)   
Distributions of earnings from excess mortgage servicing rights, equity method investees 23,659   
Earnings from consumer loan equity method investees (60,293)   
Distributions of earnings from consumer loan equity method investees 60,293   
Accretion of discount and other amortization (8,008) (2,030)
(Gain)/Loss on settlement of investments (net) (11,271)   
Other-than-temporary impairment ("OTTI") 3,756   
Change in:    
Other assets (7,145) (58)
Due to affiliates 1,973 1,647
Accrued expenses and other liabilities 1,752 1,406
Reduction of liability deemed as capital contribution by Newcastle 11,515   
Other operating cash flows:    
Cash proceeds from investments, in excess of interest income 41,435 19,021
Net cash proceeds deemed as capital distributions to Newcastle (52,888) (34,403)
Net cash provided by (used in) operating activities 104,580   
Cash Flows From Investing Activities    
Purchase of Agency ARM RMBS (292,980)   
Purchase of Non-Agency RMBS (202,484)   
Acquisition of investments in excess mortgage servicing rights (46,421)   
Acquisition of investments in excess mortgage servicing rights. equity method investees (226,837)   
Principal repayments from Agency ARM RMBS 219,187   
Principal repayments from Non-Agency RMBS 50,878   
Proceeds from sale of investments 123,130   
Return of investments in excess mortgage servicing rights 15,132   
Return of investments in excess mortgage servicing rights, equity method investees 4,018   
Return of investments in consumer loan equity method investees 52,923  
Principal repayments from residential mortgage loans 2,400   
Net cash provided by (used in) investing activities (301,054)   
Cash Flows From Financing Activities    
Repayments of repurchase agreements (1,283,567)   
Margin deposits under repurchase agreements (210,507)   
Payment of deferred financing fees (166)   
Common stock dividends paid (17,712)   
Borrowings under repurchase agreements 1,425,413   
Return of margin deposits under repurchase agreements 210,158   
Capital contributions 245,058   
Net cash provided by (used in) financing activities 368,677   
Net Increase (Decrease) in Cash and Cash Equivalents 172,203   
Cash and Cash Equivalents, Beginning of Period      
Cash and Cash Equivalents, End of Period 172,203   
Supplemental Disclosure of Cash Flow Information    
Cash paid during the period for interest expense 6,853 280
Prior to Date of Cash Contribution by Newcastle    
Cash proceeds from investments, in excess of interest income 41,435 19,021
Acquisition of real estate securities 242,750 34,619
Acquisition of investments in excess mortgage servicing rights    218,642
Deposit paid on investment in excess mortgage servicing rights    25,200
Purchase price payable on investments in excess mortgage servicing rights    3,250
Acquisition of investments in excess mortgage servicing rights, equity method investees at fair value 125,099   
Acquisition of investments in consumer loan equity method investees 245,421   
Acquisition of residential mortgage loans, held-for-investment 35,138   
Borrowings under repurchase agreements 1,179,068 60,772
Repayments of repurchase agreements 3,902 1,126
Capital contributions by Newcastle 648,408 278,461
Contributions in-kind by Newcastle 1,093,684 164,142
Capital distributions to Newcastle 1,228,054 94,049
Subsequent to Date of Cash Contribution by Newcastle    
Dividends declared but not paid $ 44,308