MFA Financial announces 4Q results

MFA Financial today announced financial results for the fourth quarter ended December 31, 2012. Fourth quarter net income per common share of $0.19 and Core Earnings as per common share of $0.20. Book value per common share grew to $8.99 as of December 31, 2012, compared to $8.80 as of September 30, 2012, and $6.74 at December 31, 2011. For the year, MFA's strategy of investing in both Agency and discounted NonAgency MBS generated book value per share growth of 33% in addition to quarterly dividend payments. At January 31, 2013, MFA's book value per share was $9.40 as Non- Agency MBS prices have gained additional value since year end.

On March 4, 2013, MFA's Board of Directors declared a special cash dividend of $0.50 per share of common stock. This dividend reflects a portion of the REIT taxable income in excess of distributions previously paid to stockholders for prior periods. This dividend will be paid on April 10, 2013, to stockholders of record on March 15, 2013.

A combination of both home price appreciation and mortgage amortization has led to a decrease in the Loan-toValue ratio ("LTV") for many of the mortgages underlying MFA's Non-Agency portfolio. Due to this lower LTV, we have reduced estimated future losses within MFA's NonAgency portfolio. As a result, in the fourth quarter we transferred $81.0 million to accretable discount from credit reserve and transferred $152.5 million in total for 2012. This increase in accretable discount prospectively increases the yield on Non-Agency MBS and will be realized in income over the life of the assets.

For the fourth quarter ended December 31, 2012, MFA generated net income allocable to common stockholders of $66.8 million, or $0.19 per share of common stock. Core Earnings for the fourth quarter were $72.0 million, or $0.20 per share of common stock.