We have concluded that, after the close of its public offering, Orchid is a variable interest entity pursuant to financial accounting rules because Orchid's equity holders lack the ability through voting rights to make decisions about its activities that have a significant effect on its success. We have also concluded that Bimini is the primary beneficiary of Orchid because, under the terms of the management agreement, Bimini has the power to direct the activities of Orchid that most significantly impact its economic performance including asset selection, asset and liability management and investment portfolio risk management. As a result, we will continue to consolidate Orchid in our Consolidated Financial Statements.

The following is a summarized presentation of the unaudited balance sheets as of December 31, 2012, and 2011, and the unaudited quarterly results of operations for the calendar quarters ended December 31, 2012, September 30, 2012, and December 31, 2011.
BIMINI CAPITAL MANAGEMENT, INC.
CONSOLIDATED BALANCE SHEETS
($ in thousands, except per share amounts)      
       
  12/31/2012 12/31/2011 % Change
ASSETS      
Mortgage-backed securities $ 168,155  $ 91,142  84.5%
Cash equivalents and restricted cash  7,433   4,718  57.5%
Accrued interest receivable  719   901  (20.20)%
Retained interests  3,336   3,495  (4.55)%
Other assets  7,710   8,998  (14.31)%
Total Assets $ 187,353  $ 109,254  71.5%
       
LIABILITIES AND STOCKHOLDERS' EQUITY      
Repurchase agreements $ 150,294  $ 69,528  116.2%
Junior subordinated notes  26,804   26,804  --
Other liabilities  6,738   7,555  (10.81)%
Total Liabilities  183,836   103,887  77.0%
Stockholders' Equity  3,517   5,367  (34.47)%
Total Liabilities and Stockholders' Equity $ 187,353  $ 109,254  71.5%
Class A Common Shares outstanding  10,616,912   10,086,854   
Book value per share $ 0.33  $ 0.53   
 
 
 
BIMINI CAPITAL MANAGEMENT, INC.
CONSOLIDATED STATEMENTS OF OPERATIONS
  For the calendar quarter ended
  12/31/2012 9/30/2012 % Change 12/31/2011 % Change
Interest income $ 751  $ 1,165  (35.5)% $ 1,040  (27.8)%
Interest expense  (151)  (104) (45.2)%  (59) (155.9)%
Net interest income, before interest on junior subordinated notes  600   1,061  (43.5)%  981  (38.8)%
Interest expense on junior subordinated notes  (257)  (266) 3.4%  (258) 0.0%
Net interest income  343   795  (56.8)%  723  (52.6)%
Losses  (1,073)  (19) (5,547.4)%  (418) (156.1)%
Net portfolio (deficiency) income  (730)  776  (194.1)%  305  (339.3)%
Other income (expenses) 119  796  (85.1)%  (716) 116.6%
Expenses  (1,305)  (2,334) 44.1%  (1,996) 34.6%
Net loss $ (1,916) $ (762) (151.4)% $ (2,407) 20.4%
Basic and Diluted Net loss Per Share of:          
CLASS A COMMON STOCK $ (0.18) $ (0.07)   $ (0.24)  
CLASS B COMMON STOCK $ (0.18) $ (0.07)   $ (0.24)  

About Bimini Capital Management, Inc.

Bimini Capital Management, Inc. is a REIT that invests primarily in, but is not limited to, residential mortgage-related securities issued by the Federal National Mortgage Association (Fannie Mae), the Federal Home Loan Mortgage Corporation (Freddie Mac) and the Government National Mortgage Association (Ginnie Mae). Its objective is to earn returns on the spread between the yield on its assets and its costs, including the interest expense on the funds it borrows.

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