The following is a presentation of the quarterly results of operations for the years ended December 31, 2014 and 2013.

Hatteras Financial Corp.

Consolidated Statements of Income

	For the Three Months Ended
	December 31,			September 30,		June 30,			March 31,
	2014			2014		2014			2014
(Dollars in thousands, except share related amounts)	(Unaudited)			(Unaudited)		(Unaudited)			(Unaudited)

Interest income:
Mortgage-backed securities	$	87,702		$	80,969	$	89,458		$	96,307
Mortgage loans held for investment		35			-		-			-
Short-term cash investments		324			330		347			282
Total interest income		88,061			81,299		89,805			96,589

Interest expense		26,966			31,950		35,128			38,451

Net interest margin		61,095			49,349		54,677			58,138

Operating expenses:
Management fee		4,112			4,122		4,144			4,154
Share-based compensation		1,020			890		842			860
General and administrative		3,941			2,113		2,324			2,147
Total operating expenses		9,073			7,125		7,310			7,161

Other income (loss):
Net realized gain (loss) on sale of mortgage-backed securities		2,107			237		(4,584	)		7,436
Impairment of mortgage-backed securities		-			-		-			-
Gain on mortgage loans held for investment		8			-		-			-
Gain (loss) on derivative instruments, net		(79,988	)		35,430		(55,260	)		(41,615	)
Total other income (loss)		(77,873	)		35,667		(59,844	)		(34,179	)

Net income (loss)		(25,851	)		77,891		(12,477	)		16,798
Dividends on preferred stock		5,481			5,480		5,481			5,480
Net income (loss) available to common shareholders	$	(31,332	)	$	72,411	$	(17,958	)	$	11,318

Earnings (loss) per share - common stock, basic	$	(0.32	)	$	0.75	$	(0.19	)	$	0.12

Earnings (loss) per share - common stock, diluted	$	(0.32	)	$	0.75	$	(0.19	)	$	0.12

Dividends per share of common stock	$	0.50		$	0.50	$	0.50		$	0.50

Weighted average common shares outstanding, basic		96,728,821			96,563,132		96,515,599			96,606,081

Weighted average common shares outstanding, diluted		96,728,821			96,563,132		96,515,599			96,606,081

Hatteras Financial Corp.

Consolidated Statements of Income

	For the Three Months Ended
	December 31,			September 30,			June 30,		March 31,
	2013			2013			2013		2013
(Dollars in thousands, except share related amounts)	(Unaudited)			(Unaudited)			(Unaudited)		(Unaudited)

Interest income:
Mortgage-backed securities	$	104,312		$	107,040		$	115,115	$	124,241
Short-term cash investments		456			303			359		442
Total interest income		104,768			107,343			115,474		124,683

Interest expense		40,754			51,599			52,079		53,277

Net interest margin		64,014			55,744			63,395		71,406

Operating expenses:
Management fee		4,224			4,522			4,714		4,720
Share-based compensation		701			637			627		629
General and administrative		2,583			1,538			1,602		1,369
Total operating expenses		7,508			6,697			6,943		6,718

Other income (loss):
Net realized gain (loss) on sale of mortgage-backed securities		(68,679	)		(225,635	)		8,802		2,500
Impairment of mortgage-backed securities		-			(8,102	)		-		-
Gain (loss) on derivative instruments, net		2,205			(77,456	)		5,485		51
Total other income (loss)		(66,474	)		(311,193	)		14,287		2,551

Net income (loss)		(9,968	)		(262,146	)		70,739		67,239
Dividends on preferred stock		5,481			5,481			5,480		5,480
Net income (loss) available to common shareholders	$	(15,449	)	$	(267,627	)	$	65,259	$	61,759

Earnings (loss) per share - common stock, basic	$	(0.16	)	$	(2.72	)	$	0.66	$	0.62

Earnings (loss) per share - common stock, diluted	$	(0.16	)	$	(2.72	)	$	0.66	$	0.62

Dividends per share of common stock	$	0.50		$	0.55		$	0.70	$	0.70

Weighted average common shares outstanding, basic		97,389,614			98,318,205			98,830,054		98,827,587

Weighted average common shares outstanding, diluted		97,389,614			98,318,205			98,830,054		98,827,587