Title of each Class	Latest Practicable Date	Shares Outstanding
Class A Common Stock, $0.001 par value	August ~~5, 2015~~10, 2016		~~12,355,045~~	12,631,627
Class B Common Stock, $0.001 par value	August ~~5, 2015~~	10, 2016	31,938
Class C Common Stock, $0.001 par value	August ~~5, 2015~~	10, 2016	31,938

BIMINI CAPITAL MANAGEMENT, INC.

TABLE OF CONTENTS

		Page

PART I. FINANCIAL INFORMATION

ITEM 1. Condensed Financial Statements		1
	1
Consolidated Balance Sheets as of June 30, ~~2015~~2016 (unaudited) and December 31, ~~2014~~		2015	1

Consolidated Statements of Operations (unaudited) for the six and three months ended June 30, ~~2015~~2016 and ~~2014~~		2015	2

Consolidated Statement of ~~Stockholders’~~Stockholders' Equity (unaudited) for the six months ended June 30, ~~2015~~		2016	3

Consolidated Statements of Cash Flows (unaudited) for the six months ended June 30, ~~2015~~2016 and ~~2014~~		2015	4
ITEM 2. ~~Management’s~~Management's Discussion and Analysis of Financial Condition and Results of Operations				26	24
ITEM 3. Quantitative and Qualitative Disclosures About Market Risk				52	45
ITEM 4. Controls and Procedures				52	45

PART II. OTHER INFORMATION

ITEM 1. Legal Proceedings				53	46
ITEM 1A. Risk Factors				53	46
ITEM 2. Unregistered Sales of Equity Securities and Use of Proceeds				54	46
ITEM 3. Defaults Upon Senior Securities				54	46
ITEM 4. Mine Safety Disclosures				54	46
ITEM 5. Other Information				54	46
ITEM 6. Exhibits				55	47
SIGNATURES				56	48

PART I. FINANCIAL INFORMATION

ITEM 1. CONDENSED FINANCIAL STATEMENTS

BIMINI CAPITAL MANAGEMENT, INC.
CONSOLIDATED BALANCE SHEETS

	(Unaudited)
	June 30, 2016			December 31, 2015
ASSETS:
Mortgage-backed securities, at fair value
Pledged to counterparties	$	109,365,163		$	81,192,199
Unpledged		1,472,840			2,796,200
Total mortgage-backed securities		110,838,003			83,988,399
Cash and cash equivalents		3,879,595			6,310,683
Restricted cash		562,630			401,800
Orchid Island Capital, Inc. common stock, at fair value		14,354,920			13,852,707
Retained interests in securitizations		1,359,275			1,124,278
Accrued interest receivable		426,005			351,049
Property and equipment, net		3,448,624			3,492,612
Deferred tax assets, net		64,300,364			64,832,242
Other assets		2,921,690			2,701,655
Total Assets	$	202,091,106		$	177,055,425

LIABILITIES AND STOCKHOLDERS' EQUITY

LIABILITIES:
Repurchase agreements	$	103,724,730		$	77,234,249
Junior subordinated notes due to Bimini Capital Trust II		26,804,440			26,804,440
Payable for unsettled securities purchased		-			1,859,277
Accrued interest payable		118,979			83,957
Other liabilities		1,645,672			2,533,442
Total Liabilities		132,293,821			108,515,365

COMMITMENTS AND CONTINGENCIES

STOCKHOLDERS' EQUITY:
Preferred stock, $0.001 par value; 10,000,000 shares authorized; 100,000 shares
designated Series A Junior Preferred Stock, 9,900,000 shares undesignated;
no shares issued and outstanding as of June 30, 2016 and 2015		-			-
Class A Common stock, $0.001 par value; 98,000,000 shares designated: 12,631,627
shares issued and outstanding as of June 30, 2016 and 12,373,294 shares
issued and outstanding as of December 31, 2015		12,632			12,373
Class B Common stock, $0.001 par value; 1,000,000 shares designated, 31,938 shares
issued and outstanding as of June 30, 2016 and December 31, 2015		32			32
Class C Common stock, $0.001 par value; 1,000,000 shares designated, 31,938 shares
issued and outstanding as of June 30, 2016 and December 31, 2015		32			32
Additional paid-in capital		334,839,540			334,630,263
Accumulated deficit		(265,054,951	)		(266,102,640	)
Stockholders' equity		69,797,285			68,540,060
Total Liabilities and Stockholders' Equity	$	202,091,106		$	177,055,425
See Notes to Consolidated Financial Statements

BIMINI CAPITAL MANAGEMENT, INC.
CONSOLIDATED BALANCE SHEETS

(Unaudited)
June 30, 2015 December 31, 2014
ASSETS:
Mortgage-backed securities, at fair value
Pledged to counterparties $ 105,812,917 $ 116,026,180
Unpledged 1,948,249 1,804,852
Total mortgage-backed securities 107,761,166 117,831,032
Cash and cash equivalents 7,009,072 4,699,059 ��
Restricted cash 2,547,550 733,660
Orchid Island Capital, Inc. common stock, at fair value 11,004,464 12,810,728
Retained interests in securitizations 2,141,458 1,899,684
Accrued interest receivable 440,267 460,326
Property and equipment, net 3,537,405 3,584,603
Deferred tax assets, net 1,428,754 1,900,064
Other assets 2,652,616 2,960,042
Total Assets $ 138,522,752 $ 146,879,198

LIABILITIES AND STOCKHOLDERS' EQUITY

LIABILITIES:
Repurchase agreements $ 101,205,930 $ 109,963,995
Junior subordinated notes due to Bimini Capital Trust II 26,804,440 26,804,440
Accrued interest payable 89,111 94,397
Other liabilities 4,065,873 814,597
Total Liabilities 132,165,354 137,677,429

STOCKHOLDERS' EQUITY:
Preferred stock - -
Common stock 12,410 12,388
Additional paid-in capital 334,571,864 334,522,850
Accumulated deficit (328,226,876 ) (325,333,469 )
Stockholders’ equity 6,357,398 9,201,769
Total Liabilities and Stockholders' Equity $ 138,522,752 $ 146,879,198
See Notes to Consolidated Financial Statements

-1-

BIMINI CAPITAL MANAGEMENT, INC.
CONSOLIDATED STATEMENTS OF OPERATIONS
(Unaudited)
For the Six and Three Months Ended June 30, 2016 and 2015

	Six Months Ended June 30,						Three Months Ended June 30,
	2016			2015			2016			2015
Interest income	$	1,842,540		$	2,281,256		$	1,025,076		$	1,074,122
Interest expense		(301,973	)		(198,334	)		(174,069	)		(98,142	)
Net interest income, before interest on junior subordinated notes		1,540,567			2,082,922			851,007			975,980
Interest expense on junior subordinated notes		(539,972	)		(491,461	)		(276,361	)		(247,988	)
Net interest income		1,000,595			1,591,461			574,646			727,992
Unrealized (losses) gains on mortgage-backed securities		(39,157	)		(197,399	)		249,087			(1,026,695	)
Realized gains on mortgage-backed securities		250,973			-			19,126			-
(Losses) gains on derivative instruments		(2,057,475	)		(1,009,075	)		(757,613	)		5,625
Net portfolio (loss) income		(845,064	)		384,987			85,246			(293,078	)

Other income:
Advisory services		2,542,536			2,382,357			1,273,517			1,287,702
Gains on retained interests in securitizations		1,079,867			2,538,580			533,847			1,052,824
Unrealized gains (losses) on Orchid Island Capital, Inc. common stock		502,213			(1,806,264	)		(111,603	)		(1,992,780	)
Orchid Island Capital, Inc. dividends		1,171,830			1,060,198			585,915			530,099
Other income		460			477			230			214
Total other income		5,296,906			4,175,348			2,281,906			878,059

Expenses:
Compensation and related benefits		1,551,017			1,521,725			755,307			737,621
Directors' fees and liability insurance		311,075			342,703			155,538			174,937
Audit, legal and other professional fees		295,150			1,047,451			138,078			712,674
Settlement of litigation		-			3,500,000			-			-
Administrative and other expenses		566,556			433,552			304,930			193,012
Total expenses		2,723,798			6,845,431			1,353,853			1,818,244

Net income (loss) before income tax provision		1,728,044			(2,285,096	)		1,013,299			(1,233,263	)
Income tax provision		680,355			608,311			411,601			271,216

Net income (loss)	$	1,047,689		$	(2,893,407	)	$	601,698		$	(1,504,479	)


Basic and Diluted Net Income (Loss) Per Share of:
CLASS A COMMON STOCK
Basic and Diluted	$	0.08		$	(0.23	)	$	0.05		$	(0.12	)
CLASS B COMMON STOCK
Basic and Diluted	$	0.08		$	(0.23	)	$	0.05		$	(0.12	)
Weighted Average Shares Outstanding:
CLASS A COMMON STOCK
Basic and Diluted		12,687,836			12,339,358			12,709,127			12,346,224
CLASS B COMMON STOCK
Basic and Diluted		31,938			31,938			31,938			31,938
See Notes to Consolidated Financial Statements

~~-1-~~-2-

BIMINI CAPITAL MANAGEMENT, INC.
CONSOLIDATED STATEMENT OF STOCKHOLDERS' EQUITY
(Unaudited)
For the Six Months Ended June 30, 2016

	Stockholders' Equity
		Common		Additional			Accumulated
		Stock		Paid-in Capital			Deficit				Total
Balances, January 1, 2016		$	12,437		$	334,630,263		$	(266,102,640	)		$	68,540,060
Net income			-			-			1,047,689				1,047,689
Issuance of Class A common shares for equity plan exercises			259			193,491			-				193,750
Amortization of equity plan compensation			-			15,786			-				15,786

Balances, June 30, 2016		$	12,696		$	334,839,540		$	(265,054,951	)		$	69,797,285
See Notes to Consolidated Financial Statements

BIMINI CAPITAL MANAGEMENT, INC.
CONSOLIDATED STATEMENTS OF OPERATIONS
(Unaudited)
For the Six and Three Months Ended June 30, 2015 and 2014

Six Months Ended June 30, Three Months Ended June 30,
2015 2014 2015 2014
Interest income $ 2,281,256 $ 11,235,494 $ 1,074,122 $ 7,119,482
Interest expense (198,334 ) (1,182,616 ) (98,142 ) (728,277 )
Net interest income, before interest on junior subordinated notes 2,082,922 10,052,878 975,980 6,391,205
Interest expense on junior subordinated notes (491,461 ) (488,517 ) (247,988 ) (245,334 )
Net interest income 1,591,461 9,564,361 727,992 6,145,871
Unrealized (losses) gains on mortgage-backed securities (197,399 ) 11,266,428 (1,026,695 ) 9,698,117
Realized gains on mortgage-backed securities - 4,049,477 - 2,980,121
(Losses) gains on derivative instruments (1,009,075 ) (7,590,975 ) 5,625 (5,873,958 )
Net portfolio income (loss) 384,987 17,289,291 (293,078 ) 12,950,151

Other income:
Gains on retained interests in securitizations 2,538,580 2,446,586 1,052,824 2,252,897
Unrealized losses on Orchid Island Capital, Inc. common stock (1,806,264 ) - (1,992,780 ) -
Orchid Island Capital, Inc. dividends 1,060,198 - 530,099 -
Management fees 1,868,700 - 1,013,900 -
Other expense, net (22,153 ) (20,253 ) (10,174 ) (10,125 )
Total other income 3,639,061 2,426,333 593,869 2,242,772

Expenses:
Compensation and related benefits 1,263,444 1,357,307 594,653 911,134
Directors' fees and liability insurance 342,703 543,512 174,937 302,950
Audit, legal and other professional fees 1,047,451 1,088,791 712,674 688,541
Direct REIT operating expenses 36,858 229,316 18,055 114,133
Settlement of litigation 3,500,000 - - -
Other administrative expenses 118,688 391,075 33,735 236,354
Total expenses 6,309,144 3,610,001 1,534,054 2,253,112

Net (loss) income before income tax provision (benefit) (2,285,096 ) 16,105,623 (1,233,263 ) 12,939,811
Income tax provision (benefit) 608,311 (2,131,758 ) 271,216 25,601

Net (loss) income (2,893,407 ) 18,237,381 (1,504,479 ) 12,914,210
Less: income attributable to noncontrolling interests - 12,538,193 - 9,584,234

Net (Loss) Income attributable to Bimini Capital stockholders $ (2,893,407 ) $ 5,699,188 $ (1,504,479 ) $ 3,329,976

Basic and Diluted Net (Loss) Income Per Share of:
CLASS A COMMON STOCK
Basic and Diluted $ (0.23 ) $ 0.47 $ (0.12 ) $ 0.27
CLASS B COMMON STOCK
Basic and Diluted $ (0.23 ) $ 0.47 $ (0.12 ) $ 0.27
Weighted Average Shares Outstanding:
CLASS A COMMON STOCK
Basic and Diluted 12,339,358 12,071,977 12,346,224 12,294,879
CLASS B COMMON STOCK
Basic and Diluted 31,938 31,938 31,938 31,938
See Notes to Consolidated Financial Statements

~~-2-~~-3-

BIMINI CAPITAL MANAGEMENT, INC.
CONSOLIDATED STATEMENT OF STOCKHOLDERS' EQUITY
(Unaudited)
For the Six Months Ended June 30, 2015

Stockholders' Equity
Common Additional Accumulated
Stock Paid-in Capital Deficit Total
Balances, January 1, 2015 $ 12,388 $ 334,522,850 $ (325,333,469 ) $ 9,201,769
Net loss - - (2,893,407 ) (2,893,407 )
Issuance of Class A common shares for board compensation 22 39,669 - 39,691
Amortization of equity plan compensation - 9,345 - 9,345

Balances, June 30, 2015 $ 12,410 $ 334,571,864 $ (328,226,876 ) $ 6,357,398
See Notes to Consolidated Financial Statements

BIMINI CAPITAL MANAGEMENT, INC.
CONSOLIDATED STATEMENTS OF CASH FLOWS
(Unaudited)
For the Six Months Ended June 30, 2016 and 2015

	2016			2015
CASH FLOWS FROM OPERATING ACTIVITIES:
Net income (loss)	$	1,047,689		$	(2,893,407	)
Adjustments to reconcile net income (loss) to net cash (used in) provided by operating activities:
Stock based compensation		209,536			49,036
Depreciation		43,988			47,198
Deferred income tax provision		531,878			471,310
(Gains) losses on mortgage-backed securities		(211,816	)		197,399
Gains on retained interests in securitizations		(1,079,867	)		(2,538,580	)
Unrealized (gains) losses on Orchid Island Capital, Inc. common stock		(502,213	)		1,806,264
Changes in operating assets and liabilities:
Accrued interest receivable		(74,956	)		20,059
Other assets		(220,035	)		307,426
Accrued interest payable		35,022			(5,286	)
Other liabilities		(887,770	)		3,251,276
NET CASH (USED IN) PROVIDED BY OPERATING ACTIVITIES		(1,108,544	)		712,695

CASH FLOWS FROM INVESTING ACTIVITIES:
From mortgage-backed securities investments:
Purchases		(74,459,950	)		(986,194	)
Sales		41,767,104			-
Principal repayments		6,055,058			10,858,661
Payments received on retained interests in securitizations		844,870			2,296,806
Increase in restricted cash		(160,830	)		(1,813,890	)
Purchases of Orchid Island Capital, Inc. common stock		(1,859,277	)		-
NET CASH (USED IN) PROVIDED BY INVESTING ACTIVITIES		(27,813,025	)		10,355,383

CASH FLOWS FROM FINANCING ACTIVITIES:
Proceeds from repurchase agreements		424,489,350			451,679,644
Principal repayments on repurchase agreements		(397,998,869	)		(460,437,709	)
NET CASH PROVIDED BY (USED IN) FINANCING ACTIVITIES		26,490,481			(8,758,065	)

NET (DECREASE) INCREASE IN CASH AND CASH EQUIVALENTS		(2,431,088	)		2,310,013
CASH AND CASH EQUIVALENTS, beginning of the period		6,310,683			4,699,059
CASH AND CASH EQUIVALENTS, end of the period	$	3,879,595		$	7,009,072

SUPPLEMENTAL DISCLOSURES OF CASH FLOW INFORMATION:
Cash paid during the period for:
Interest	$	806,923		$	695,081
Income taxes	$	515,433		$	137,001

See Notes to Consolidated Financial Statements

~~-3-~~-4-

BIMINI CAPITAL MANAGEMENT, INC.
CONSOLIDATED STATEMENTS OF CASH FLOWS
(Unaudited)
For the Six Months Ended June 30, 2015 and 2014

2015 2014
CASH FLOWS FROM OPERATING ACTIVITIES:
Net (loss) income $ (2,893,407 ) $ 18,237,381
Adjustments to reconcile net (loss) income to net cash provided by (used in) operating activities:
Stock based compensation 49,036 221,498
Depreciation 47,198 54,629
Deferred income tax provision (benefit) 471,310 (2,154,025 )
Losses (gains) on mortgage-backed securities 197,399 (15,315,905 )
Gains on retained interests in securitizations (2,538,580 ) (2,446,586 )
Unrealized losses on Orchid Island Capital, Inc. common stock 1,806,264 -
Realized and unrealized losses on interest rate swaptions - 1,285,300
Changes in operating assets and liabilities:
Accrued interest receivable 20,059 (2,368,595 )
Other assets 307,426 (239,673 )
Accrued interest payable (5,286 ) 218,451
Other liabilities 3,251,276 245,850
NET CASH PROVIDED BY (USED IN) OPERATING ACTIVITIES 712,695 (2,261,675 )

CASH FLOWS FROM INVESTING ACTIVITIES:
From mortgage-backed securities investments:
Purchases (986,194 ) (1,003,577,756 )
Sales - 434,601,973
Principal repayments 10,858,661 28,820,992
Payments received on retained interests in securitizations 2,296,806 1,842,410
Increase in restricted cash (1,813,890 ) (1,435,035 )
Purchases of property and equipment - (34,550 )
Purchase of interest rate swaptions, net of margin cash received - (1,219,000 )
NET CASH PROVIDED BY (USED IN) INVESTING ACTIVITIES 10,355,383 (541,000,966 )

CASH FLOWS FROM FINANCING ACTIVITIES:
Proceeds from repurchase agreements 451,679,644 3,523,211,129
Principal repayments on repurchase agreements (460,437,709 ) (3,022,580,809 )
Issuance of common shares of Orchid Island Capital, Inc. - 75,115,922
Cash dividends paid to noncontrolling interests - (7,378,350 )
Class A common shares sold directly to employees - 98,000
NET CASH (USED IN) PROVIDED BY FINANCING ACTIVITIES (8,758,065 ) 568,465,892

NET INCREASE IN CASH AND CASH EQUIVALENTS 2,310,013 25,203,251
CASH AND CASH EQUIVALENTS, beginning of the period 4,699,059 11,959,292
CASH AND CASH EQUIVALENTS, end of the period $ 7,009,072 $ 37,162,543

SUPPLEMENTAL DISCLOSURES OF CASH FLOW INFORMATION:
Cash paid during the period for:
Interest $ 695,081 $ 1,452,682
Income taxes $ 137,001 $ 22,267

SUPPLEMENTAL DISCLOSURE OF NONCASH INVESTING ACTIVITIES:
Securities acquired settled in later period $ - $ 6,825,538
See Notes to Consolidated Financial Statements

~~-4-~~

BIMINI CAPITAL MANAGEMENT, INC.

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

(Unaudited)

June 30, ~~2015~~2016

NOTE 1. ORGANIZATION AND SIGNIFICANT ACCOUNTING POLICIES

Organization and Business Description

Bimini Capital Management, Inc., a Maryland corporation (“("Bimini ~~Capital”~~Capital" or the "Company"), was formed in September 2003 for the purpose of creating and managing a leveraged investment portfolio consisting of residential mortgage-backed securities ~~(“MBS”~~("MBS"). Bimini Capital has elected to be taxed as a real estate investment trust (“REIT”) under the Internal Revenue Code of 1986, as amended (the “Code”). As a REIT, Bimini Capital is generally not subject to federal income tax on its REIT taxable income provided that it distributes to its stockholders at least 90% of its REIT taxable income on an annual basis. In addition, ~~a REIT must meet other provisions of~~ the ~~Code to retain its special tax status. Bimini Capital’s website is located at http://www.biminicapital.com.~~

~~On February 20, 2013,~~Company manages an MBS portfolio for Orchid Island Capital, Inc. ~~(“Orchid”~~("Orchid") completed the initial public offering (“IPO”) of its common stock. Prior to the completion of its IPO, Orchid was a wholly-owned qualified REIT subsidiary of Bimini Capital. Since Orchid’s IPO and ~~until December 31, 2014, Orchid was consolidated as a variable interest entity (“VIE”). Effective December 31, 2014, Orchid was deconsolidated.~~

~~As used in this document, discussions related to REIT qualifying activities include the MBS portfolios of both Bimini Capital and Orchid~~receives fees for 2014, and only the MBS portfolio of Bimini Capital for 2015. Discussions related to the “Company” refer to the consolidated entity, including Bimini Capital, our wholly-owned subsidiaries, and, through December 31, 2014, our VIE. References to “Bimini Capital” and the “parent” refer to Bimini Capital Management, Inc. as a separate entity. Discussions related to Bimini Capital’s taxable REIT subsidiaries or non-REIT eligible assets refer to Bimini Advisors, Inc. and its wholly-owned subsidiary, Bimini Advisors, LLC (together “Bimini Advisors”), and MortCo TRS, LLC and its consolidated subsidiaries (“MortCo”).providing these services.

Consolidation

The accompanying consolidated financial statements include the accounts of Bimini Capital, Bimini Advisors Holdings, LLC, and ~~MortCo. The accounts of Orchid are included in the~~its wholly-owned subsidiary, Bimini Advisors, LLC (together "Bimini Advisors"), and MortCo TRS, LLC and its consolidated ~~statements of operations for the six and three months ended June 30, 2014, and in the statement of cash flows for the six months ended June 30, 2014.~~subsidiaries ("MortCo"). All inter-company accounts and transactions have been eliminated from the consolidated financial statements.

Financial Accounting Standards Board (the ~~“FASB”~~"FASB") Accounting Standards Codification ~~(“ASC”~~("ASC") Topic 810, Consolidation, requires the consolidation of a ~~VIE~~variable interest entity ("VIE") by an enterprise if it is deemed the primary beneficiary of the VIE. Further, ASC 810 requires a qualitative assessment to determine the primary beneficiary of a VIE, an ongoing assessment of whether an enterprise is the primary beneficiary of a VIE, and additional disclosures for entities that have variable interests in VIEs.

From the effective date of Orchid’s IPO and until December 31, 2014, management concluded, pursuant to ASC 810, that Orchid was a VIE. As a result, subsequent to Orchid’s IPO and until December 31, 2014, the Company consolidated Orchid in its financial statements. The results of operations of Orchid were included in the Company’s 2014 consolidated statements of operations and cash flows, however, net income attributable to Bimini Capital stockholders did not include the portion of net income attributable to noncontrolling interests.

~~-5-~~

In December 2014, management re-evaluated the conditions resulting in the consolidation of Orchid and concluded that, due to Bimini’s decreased percentage ownership interest in Orchid, there was no longer a variable interest requiring consolidation. As a result, in accordance with ASC 810, the Company deconsolidated Orchid from the consolidated balance sheet as of December 31, 2014. However, as a VIE which was deconsolidated on December 31, 2014, Orchid’s results of operations were included in the consolidated statements of operations and cash flows through December 31, 2014, and are excluded in subsequent periods.

Assets recognized as a result of consolidating Orchid in prior periods did not represent additional assets that could be used to satisfy claims against Bimini Capital’s assts. Conversely, liabilities recognized as a result of consolidating Orchid did not represent additional claims on Bimini Capital’s assets; rather, they represented claims against the assets of Orchid. Creditors and stockholders of Orchid have no recourse to the assets of Bimini Capital.

As further described in Note 7,8, Bimini Capital has a common share investment in a trust used in connection with the issuance of Bimini ~~Capital’s~~Capital's junior subordinated notes. Pursuant to ASC 810, management has concluded that, while the trust is a VIE, Bimini ~~Capital’s~~Capital's common share investment in the trust is not a variable interest. Therefore, the trust has not been consolidated in the financial statements of Bimini Capital, and accordingly, this investment has been accounted for on the equity method.

~~Liquidity~~

In 2006 and 2007, there were significant losses incurred which were attributable to the former mortgage origination operations of MortCo. These losses significantly reduced Bimini Capital’s equity capital base and the size of its MBS portfolio when compared to pre-2006 levels. This caused the Company’s overhead to be high in relation to its portfolio size. The smaller capital base made it difficult to generate sufficient net interest income to cover expenses.

Beginning in 2007, the Company began a series of actions to respond to the losses and their impact on our capital base. One of these actions was to evaluate and pursue capital raising opportunities for Orchid. Orchid completed its initial public offering of common stock on February 20, 2013. In accordance with the management agreement between Bimini Advisors and Orchid, Bimini Advisors receives fees for managing the MBS portfolio of Orchid, and certain overhead costs are allocated to Orchid on a pro rata basis commencing on July 1, 2014. As a stockholder of Orchid, Bimini Capital will share in distributions when paid by Orchid to its stockholders. These actions improved the Company’s liquidity outlook.

At June 30, 2015, the Company had cash and cash equivalents of approximately $7.0 million, an MBS portfolio of approximately $107.8 million and an equity capital base of approximately $6.4 million. The Company generated cash flows of approximately $13.2 million from principal and interest payments on its MBS portfolio and approximately $2.3 million from retained interests in securitizations during the six months ended June 30, 2015. In addition, during the six months ended June 30, 2015, the Company received approximately $2.3 million in management fees and expense reimbursements as manager of Orchid and approximately $1.1 in dividends from its investment in Orchid common shares. However, if cash resources are, at any time, insufficient to satisfy the Company’s liquidity requirements, such as when cash flows from operations are materially negative, the Company may be required to pledge additional assets to meet margin calls, liquidate assets, sell additional debt or equity securities or pursue other financing alternatives.

In May 2015, Bimini Capital agreed to settle a legal action as more fully described in Note 10. In connection with the settlement and in accordance with GAAP, a loss of $3.5 million has been charged to operations for the six months ended June 30, 2015. Although payments under the settlement agreement will reduce the Company’s liquidity, management believes that the Company will be able to generate sufficient cash from its operations to meet the payment obligations as they come due.

~~-6-~~

Basis of Presentation

The accompanying unaudited condensed consolidated financial statements have been prepared in accordance with accounting principles generally accepted in the United States ~~(“GAAP”~~("GAAP") for interim financial information and with the instructions to Form 10-Q and Article 8 of Regulation S-X. Accordingly, they do not include all of the information and footnotes required by GAAP for complete financial statements. In the opinion of management, all adjustments (consisting of normal recurring accruals) considered necessary for a fair presentation have been included. Operating results for the six and three month periods ended June 30, ~~2015~~2016 are not necessarily indicative of the results that may be expected for the year ending December 31, ~~2015.~~2016.

The consolidated balance sheet at December 31, ~~2014~~2015 has been derived from the audited financial statements at that date but does not include all of the information and footnotes required by GAAP for complete consolidated financial statements. For further information, refer to the financial statements and footnotes thereto included in the ~~Company’s~~Company's Annual Report on Form 10-K for the year ended December 31, ~~2014.~~2015.

-5-

Use of Estimates

The preparation of financial statements in conformity with GAAP requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities and disclosure of contingent assets and liabilities at the date of the financial statements and the reported amounts of revenues and expenses during the reporting period. Actual results could differ from those estimates. Significant estimates affecting the accompanying consolidated financial statements include the fair values of MBS, investment in Orchid common shares, ~~Eurodollar futures contracts, interest rate swaptions,~~derivatives, retained interests, asset valuation allowances and deferred tax ~~allowances.~~asset allowances recorded for each accounting period.

Statement of Comprehensive ~~(Loss)~~ Income

In accordance with ASC Topic 220, Comprehensive Income, a statement of comprehensive ~~(loss)~~ income has not been included as the Company has no items of other comprehensive income (loss). Comprehensive income (loss) ~~income~~ is the same as net income (loss) ~~income~~ for all periods presented.

Cash and Cash Equivalents and Restricted Cash

Cash and cash equivalents include cash on deposit with financial institutions and highly liquid investments with original maturities of three months or less at the time of purchase. ~~At June 30, 2015, restricted~~Restricted cash ~~consisted of approximately $0.5 million of~~includes cash ~~held by a broker as margin on Eurodollar futures contracts and $2.1 million of cash held on deposit~~pledged as collateral ~~with~~for repurchase ~~agreement counterparties. At December 31, 2014, restricted cash consisted of approximately $0.5 million of cash held by a broker as margin on Eurodollar futures contracts~~agreements and ~~$0.3 million of cash held on deposit as collateral with repurchase agreement counterparties.~~derivative instruments.

The Company maintains cash balances at ~~four~~several banks, and at times these balances may exceed federally insured limits. The Company has not experienced any losses related to these balances. The Federal Deposit Insurance Corporation insures eligible accounts up to $250,000 per depositor at each financial institution. At June 30, ~~2015,~~2016, the ~~Company’s~~Company's cash deposits exceeded federally insured limits by approximately ~~$6.0~~$2.2 million. Restricted cash balances are uninsured, but are held in separate customer accounts that are segregated from the general funds of the counterparty. The Company limits uninsured balances to only large, well-known banks and derivative counterparties and believes that it is not exposed to significant credit risk on cash and cash equivalents or restricted cash balances.

~~-7-~~

Mortgage-Backed Securities

The Company invests primarily in mortgage pass-through ~~(“PT”~~("PT") certificates, collateralized mortgage obligations, and interest-only ~~(“IO”~~("IO") securities and inverse interest-only ~~(“IIO”~~("IIO") securities representing interest in or obligations backed by pools of mortgage-backed ~~loans (collectively, “MBS”).~~loans. The Company has elected to account for its investment in MBS under the fair value option. Electing the fair value option requires the Company to record changes in fair value in the consolidated statement of operations, which, in ~~management’s~~management's view, more appropriately reflects the results of our operations for a particular reporting period and is consistent with the underlying economics and how the portfolio is managed.

The Company records MBS transactions on the trade date. Security purchases that have not settled as of the balance sheet date are included in the MBS balance with an offsetting liability recorded, whereas securities sold that have not settled as of the balance sheet date are removed from the MBS balance with an offsetting receivable recorded.

The fair value of the ~~Company’s~~Company's investment in MBS is governed by ASC Topic 820, Fair Value Measurement. The definition of fair value in ASC Topic 820 focuses on the price that would be received to sell the asset or paid to transfer the liability in an orderly transaction between market participants at the measurement date. The fair value measurement assumes that the transaction to sell the asset or transfer the liability either occurs in the principal market for the asset or liability, or in the absence of a principal market, occurs in the most advantageous market for the asset or liability. Estimated fair values for MBS are based on independent pricing sources and/or third-party broker quotes, when available.

-6-

Income on PT MBS is based on the stated interest rate of the security. Premiums or discounts present at the date of purchase are not amortized. Premium lost and discount accretion resulting from monthly principal repayments are reflected in unrealized gains ~~(losses)~~ on MBS in the consolidated statements of operations. For IO securities, the income is accrued based on the carrying value and the effective yield. The difference between income accrued and the interest received on the security is characterized as a return of investment and serves to reduce the ~~asset’s~~asset's carrying value. At each reporting date, the effective yield is adjusted prospectively from the reporting period based on the new estimate of prepayments and the contractual terms of the security. For IIO securities, effective yield and income recognition calculations also take into account the index value applicable to the security. Changes in fair value of MBS during each reporting period are recorded in earnings and reported as unrealized gains or losses on mortgage-backed securities in the accompanying consolidated statements of operations. The amount reported as unrealized gains or losses on mortgage backed securities thus captures the net effect of changes in the fair market value of securities caused by market developments and any premium or discount lost as a result of principal repayments during the period.

Orchid Island Capital, Inc. Common Stock

~~At the date of Orchid’s deconsolidation, the~~The Company has elected the fair value option for its continuing investment in Orchid common shares. The change in the fair value of this investment and dividends received on this investment are reflected in other income in the consolidated statements of ~~operations for the six and three months ended June 30, 2015.~~operations. We estimate the fair value of our investment in Orchid on a market approach using ~~“Level 1”~~"Level 1" inputs based on the quoted market price of ~~Orchid’s~~Orchid's common ~~stock.~~stock on a national stock exchange. Electing the fair value option requires the Company to record changes in fair value in the consolidated statements of operations, which, in ~~management’s~~management's view, more appropriately reflects the results of our operations for a particular reporting period and is consistent with how the investment is managed.

Advisory Services

Orchid is externally managed and advised by Bimini Advisors pursuant to the terms of a management agreement. Under the terms of the management agreement, Orchid is obligated to pay Bimini Advisors a monthly management fee and a pro rata portion of certain overhead costs and to reimburse the Company for any direct expenses incurred on its behalf.

Retained Interests in Securitizations

~~From 2004 to 2006, MortCo participated in securitization transactions as part of its mortgage origination business.~~ Retained interests in the subordinated tranches of securities created in securitization transactions were initially recorded at their fair value when issued by MortCo. Subsequent adjustments to fair value are reflected in earnings. Quoted market prices for these assets are generally not available, so the Company estimates fair value based on the present value of expected future cash flows using ~~management’s~~management's best estimates of key assumptions, which include expected credit losses, prepayment speeds, weighted-average life, and discount rates commensurate with the inherent risks of the asset.

~~-8-~~

Derivative Financial Instruments

The Company uses derivative instruments to manage interest rate risk, facilitate asset/liability strategies and manage other exposures, and it may continue to do so in the future. The principal instruments that the Company has used to date are Eurodollar futures contracts, ~~and options to enter in interest rate swaps (“interest rate swaptions”),~~ but it may enter into other transactions in the future.

The Company has elected not to ~~not~~ treat any of its derivative financial instruments as hedges in order to align the accounting treatment of its derivative instruments with the treatment of its portfolio assets under the fair value option. FASB ASC Topic 815, Derivatives and Hedging, requires that all derivative instruments be carried at fair value. Changes in fair value are recorded in earnings for each period.

-7-

Holding derivatives creates exposure to credit risk related to the potential for failure on the part of counterparties to honor their commitments. In addition, the Company may be required to post collateral based on any declines in the market value of the derivatives. In the event of default by a counterparty, the Company may have difficulty recovering its collateral and may not receive payments provided for under the terms of the agreement. To mitigate this risk, the Company uses only well-established commercial banks as counterparties.

Financial Instruments

ASC Topic 825, Financial Instruments, requires disclosure of the fair value of financial instruments for which it is practicable to estimate that value, either in the body of the financial statements or in the accompanying notes. MBS, Orchid ~~Island Capital, Inc.~~ common stock, Eurodollar futures contracts, interest rate swaptions and retained interests in securitization transactions are accounted for at fair value in the consolidated balance sheets. The methods and assumptions used to estimate fair value for these instruments are presented in Note 1314 of the consolidated financial statements.

The estimated fair value of cash and cash equivalents, restricted cash, accrued interest receivable, other assets, repurchase agreements, payable for unsettled securities purchased, accrued interest payable and other liabilities generally approximates their carrying value as of June 30, ~~2015~~2016 and December 31, ~~2014,~~2015, due to the short-term nature of these financial instruments.

It is impractical to estimate the fair value of the ~~Company’s~~Company's junior subordinated notes. Currently, there is a limited market for these types of instruments and the Company is unable to ascertain what interest rates would be available to the Company for similar financial instruments. Information regarding carrying amount, effective interest rate and maturity date for these instruments is presented in Note 78 to the consolidated financial statements.

Property and Equipment, net

Property and equipment, net, consists of computer equipment with a depreciable life of 3 years, office furniture and equipment with depreciable lives of 8 to 20 years, land which has no depreciable life, and buildings and improvements with depreciable lives of 30 years. Property and equipment is recorded at acquisition cost and depreciated using the straight-line method over the estimated useful lives of the assets.

Repurchase Agreements

The Company finances the acquisition of the majority of its PT MBS through the use of repurchase agreements under master repurchase agreements. Pursuant to ASC Topic 860, Transfers and Servicing, the Company accounts for repurchase transactions as collateralized financing transactions, which are carried at their contractual amounts, including accrued interest, as specified in the respective agreements.

~~-9-~~

Share-Based Compensation

The Company follows the provisions of ASC Topic 718, Compensation – Stock Compensation, to account for stock and stock-based awards. For stock and stock-based awards issued to employees, a compensation charge is recorded against earnings over the vesting period based on the fair value of the award. Payments pursuant to dividend equivalent rights, which are granted along with certain equity based awards, are charged to ~~stockholders’~~stockholders' equity when dividends are declared. The Company applies a zero forfeiture rate for its equity based awards, as such awards have been granted to a limited number of employees and historical forfeitures have been minimal. A significant forfeiture, or an indication that significant forfeitures may occur, would result in a revised forfeiture rate which would be accounted for prospectively as a change in an estimate. For transactions with non-employees in which services are performed in exchange for the ~~Company’s~~Company's common stock or other equity instruments, the transactions are recorded on the basis of the fair value of the service received or the fair value of the equity instruments issued, whichever is more readily measurable at the date of issuance.

-8-

Earnings Per Share

The Company follows the provisions of ASC Topic 260, Earnings Per Share, which requires companies with complex capital structures, common stock equivalents or two (or more) classes of securities that participate in dividend distributions to present both basic and diluted earnings per share ~~(“EPS”~~("EPS") on the face of the consolidated statement of operations. Basic EPS is calculated as income available to common stockholders divided by the weighted average number of common shares outstanding during the period. Diluted EPS is calculated using the treasury stock or two-class method, as applicable for common stock equivalents. However, the common stock equivalents are not included in computing diluted EPS if the result is anti-dilutive.

Outstanding shares of Class B Common Stock, participating and convertible into Class A Common Stock, are entitled to receive dividends in an amount equal to the dividends declared on each share of Class A Common Stock if, as and when authorized and declared by the Board of Directors. Accordingly, shares of the Class B Common Stock are included in the computation of basic EPS using the two-class method and, consequently, are presented separately from Class A Common Stock.

The shares of Class C Common Stock are not included in the basic EPS computation as these shares do not have participation rights. The outstanding shares of Class B and Class C Common Stock are not included in the computation of diluted EPS for the Class A Common Stock as the conditions for conversion into shares of Class A Common Stock were not met.

Income Taxes

For the calendar year ended December 31, 2015, Bimini Capital, has elected to be taxed as a real estate investment trust (“REIT”) under the Internal Revenue Code of 1986, as amended (the “Code”). REITs are generally not subject to federal income tax on their REIT taxable income provided that they distribute to their stockholders at least 90% of their REIT taxable income on an annual basis. In addition, a REIT must meet other provisions of the Code to retain its tax status. At June 30, 2015, management believes that the Company has complied with the Code requirements and Bimini Capital continues to qualify as a REIT. As further described in Note 11, Income Taxes, Bimini Advisors and MortCo ~~are~~were separate taxpaying entities for income tax purposes and ~~are taxed separately from~~filed separate Federal income tax returns. Bimini Advisors remained a separate tax paying entity through January 31, 2016; on that date, Bimini Advisors was reorganized to be an LLC wholly-owned by Bimini Capital. Beginning with the tax period starting on February 1, 2016, Bimini Capital and Bimini Advisors will be a single tax paying entity. MortCo continues to be treated as a separate tax paying entity for the year ending December 31, 2016.

Income taxes are provided for using the asset and liability method. Deferred tax assets and liabilities represent the differences between the financial statement and income tax bases of assets and liabilities using enacted tax rates. The measurement of net deferred tax assets is adjusted by a valuation allowance if, based on the Company's evaluation, it is more likely than not that they will not be realized.

The ~~Company’s~~Company's U.S. federal income tax returns for years ended on or after December 31, ~~2011~~2012 remain open for examination. Although management believes its calculations for tax returns are correct and the positions taken thereon are reasonable, the final outcome of tax audits could be materially different from the tax returns filed by the Company, and those differences could result in significant costs or benefits to the Company.

The Company measures, recognizes and presents its uncertain tax positions in accordance with ASC Topic 740, Income Taxes. Under that guidance, the Company assesses the likelihood, based on their technical merit, that tax positions will be sustained upon examination based on the facts, circumstances and information available at the end of each period. The measurement of uncertain tax positions is adjusted when new information is available, or when an event occurs that requires a change. The Company recognizes tax positions in the financial statements only when it is more likely than not that the position will be sustained upon examination by the relevant taxing authority based on the technical merits of the position. A position that meets this standard is measured at the largest amount of benefit that will more likely than not be realized upon settlement. The difference between the benefit recognized and the tax benefit claimed on a tax return is referred to as an unrecognized tax benefit and is recorded as a liability in the consolidated balance sheets. The Company records income tax-related interest and penalties, if applicable, within the income tax provision.

-9-

Reclassifications

Certain prior period amounts have been reclassified to conform to the current period presentations.

~~-10-~~

Recent Accounting Pronouncements

In June 2016, the FASB issued Accounting Standards Update ("ASU") 2016-13, Financial Instruments – Credit Losses (Topic 326): Measurement of Credit Losses on Financial Instruments. ASU 2016-13 requires credit losses on most financial assets measured at amortized cost and certain other instruments to be measured using an expected credit loss model (referred to as the current expected credit loss (CECL) model). ASU 2016-13 is effective for fiscal years, and for interim periods within those years, beginning after December 15, 2019. Early application is permitted for fiscal periods beginning after December 15, 2018. The Company is currently evaluating the potential effect of this ASU on its consolidated financial statements.

In March 2016, the FASB issued ASU2016-09, Compensation—Stock Compensation (Topic 718): Improvements to Employee Share-Based Payment Accounting. ASU No. 2016-09 simplifies certain aspects related to the accounting for share-based payment transactions, including income tax consequences, statutory withholding requirements, forfeitures and classification on the statement of cash flows. The guidance in this update is effective for fiscal years beginning after December 15, 2016, including interim periods within those fiscal years. Early adoption is permitted. Certain of the amendments related to timing of the recognition of tax benefits and tax withholding requirements should be applied using a modified retrospective transition method. Amendments related to classification on the statement of cash flows should be applied retrospectively. All other provisions may be applied on a prospective or modified retrospective basis. The Company is currently evaluating the potential effect of this ASU on its consolidated financial statements.

In January 2016, the FASB issued ASU 2016-01, Financial Instruments-Overall (Subtopic 825-10): Recognition and Measurement of Financial Assets and Financial Liabilities. ASU 2016-01 provides guidance for the recognition, measurement, presentation and disclosure of financial assets and financial liabilities. ASU 2016-01 is effective for fiscal years, and for interim periods within those years, beginning after December 15, 2017 and, for most provisions, is effective using the cumulative-effect transition approach. Early application is permitted for certain provisions. The Company is currently evaluating the potential effect of this ASU on its consolidated financial statements.

In June 2014, the ~~Financial Accounting Standards Board (“FASB”)~~FASB issued ~~Accounting Standard Update (“ASU”)~~ASU 2014-12, Compensation-Stock Compensation: Accounting for Share-Based Payments When the Terms of an Award Provide That a Performance Target Could Be Achieved after the Requisite Service Period. ASU 2014-12 requires that performance targets that affect vesting and that could be achieved after the requisite service period be treated as performance conditions. The effective date of ASU 2014-12 is for interim and annual reporting periods beginning after December 15, 2015. The ~~ASU is not expected to materially impact the Company’s consolidated financial statements.~~

~~In June 2014, the FASB issued ASU 2014-11,~~ ~~Transfers and Servicing (Topic 860): Repurchase-to-Maturity Transactions, Repurchase Financings, and Disclosures~~. ASU 2014-11 amends the accounting guidance for repurchase-to-maturity transactions and repurchase agreements executed as repurchase financings, and requires additional disclosure about certain transactions by the transferor. ASU 2014-11 is effective for certain transactions that qualify for sales treatment for the first interim or annual period beginning after December 15, 2014. The new disclosure requirements for repurchase agreements, securities lending transactions and repurchase-to-maturity transactions that qualify for secured borrowing treatment is effective for annual periods beginning after December 15, 2014 and for interim periods beginning after March 15, 2015. The adoption of this ASU did not have a material impact on the ~~Company’s~~Company's consolidated financial statements.

NOTE 2. MORTGAGE-BACKED SECURITIES

The following table presents the ~~Company’s~~Company's MBS portfolio as of June 30, ~~2015~~2016 and December 31, ~~2014:~~2015:

(in thousands)
June 30, 2015 December 31, 2014
Pass-Through MBS:
Hybrid Adjustable-rate Mortgages $ 121 $ 442
Fixed-rate Mortgages 101,160 112,174
Total Pass-Through MBS 101,281 112,616
Structured MBS:
Interest-Only Securities 3,345 2,276
Inverse Interest-Only Securities 3,135 2,939
Total Structured MBS 6,480 5,215
Total $ 107,761 $ 117,831

(in thousands)
	June 30, 2016		December 31, 2015
Pass-Through MBS:
Hybrid Adjustable-rate Mortgages	$	115	$	118
Fixed-rate Mortgages		107,751		79,170
Total Pass-Through MBS		107,866		79,288
Structured MBS:
Interest-Only Securities		1,299		2,554
Inverse Interest-Only Securities		1,673		2,146
Total Structured MBS		2,972		4,700
Total	$	110,838	$	83,988

-10-

The following table summarizes the ~~Company’s~~Company's MBS portfolio as of June 30, ~~2015~~2016 and December 31, ~~2014,~~2015, according to the contractual maturities of the securities in the portfolio. Actual maturities of MBS investments are generally shorter than stated contractual maturities and are affected by the contractual lives of the underlying mortgages, periodic payments of principal, and prepayments of principal.

(in thousands)
June 30, 2015 December 31, 2014
Greater than five years and less than ten years $ 10 $ 16
Greater than or equal to ten years 107,751 117,815
Total $ 107,761 $ 117,831

(in thousands)
	June 30, 2016			December 31, 2015
Greater than five years and less than ten years		$	1		$	3
Greater than or equal to ten years			110,837			83,985
Total		$	110,838		$	83,988

~~-11-~~

NOTE 3. RETAINED INTERESTS IN SECURITIZATIONS

The following table summarizes the estimated fair value of the ~~Company’s~~Company's retained interests in asset backed securities as of June 30, ~~2015~~2016 and December 31, ~~2014:~~

2015:

(in thousands)
Series	Issue Date	June 30, 2015		December 31, 2014		Issue Date	June 30, 2016		December 31, 2015
HMAC 2004-2	May 10, 2004	$	216	$	320	May 10, 2004	$	166	$	110
HMAC 2004-3	June 30, 2004		694		753	June 30, 2004		493		453
HMAC 2004-4	August 16, 2004		368		496	August 16, 2004		400		75
HMAC 2004-5	September 28, 2004		386		331	September 28, 2004		83		182
HMAC 2004-6	November 17, 2004		477		-	November 17, 2004		217		304
Total		$	2,141	$	1,900		$	1,359	$	1,124

NOTE 4. REPURCHASE AGREEMENTS

As of June 30, ~~2015,~~2016, the Company had outstanding repurchase agreement obligations of approximately ~~$101.2~~$103.7 million with a net weighted average borrowing rate of ~~0.39%~~0.69%. These agreements were collateralized by MBS with a fair value, including accrued interest, of approximately ~~$106.2 million, and cash pledged to counterparties of approximately $2.1~~$109.7 million. As of December 31, ~~2014,~~2015, the Company had outstanding repurchase agreement obligations of approximately ~~$110.0~~$77.2 million with a net weighted average borrowing rate of ~~0.36%~~0.61%. These agreements were collateralized by MBS with a fair value, including accrued interest, of approximately ~~$116.4 million, and cash pledged to counterparties of approximately $0.3~~$81.5 million.

-11-

As of June 30, ~~2015~~2016 and December 31, ~~2014,~~2015, the ~~Company’s~~Company's repurchase agreements had remaining maturities as summarized below:

($ in thousands)
	OVERNIGHT		BETWEEN 2			BETWEEN 31			GREATER					OVERNIGHT		BETWEEN 2			BETWEEN 31			GREATER
	(1 DAY OR		AND			AND			THAN					(1 DAY OR		AND			AND			THAN
	LESS)		30 DAYS			90 DAYS			90 DAYS		TOTAL			LESS)		30 DAYS			90 DAYS			90 DAYS		TOTAL
June 30, 2015
June 30, 2016
Fair value of securities pledged, including accrued
interest receivable	$	-	$	87,826		$	18,377		$	-	$	106,203		$	-	$	92,994		$	16,738		$	-	$	109,732
Repurchase agreement liabilities associated with
these securities	$	-	$	84,939		$	16,267		$	-	$	101,206		$	-	$	88,103		$	15,622		$	-	$	103,725
Net weighted average borrowing rate		-		0.38	%		0.43	%		-		0.39	%		-		0.69	%		0.69	%		-		0.69	%
December 31, 2014
December 31, 2015
Fair value of securities pledged, including accrued
interest receivable	$	-	$	114,433		$	1,998		$	-	$	116,431		$	-	$	81,464		$	-		$	-	$	81,464
Repurchase agreement liabilities associated with
these securities	$	-	$	108,074		$	1,890		$	-	$	109,964		$	-	$	77,234		$	-		$	-	$	77,234
Net weighted average borrowing rate		-		0.36	%		0.33	%		-		0.36	%		-		0.61	%		-			-		0.61	%

~~-12-~~

If, during the term of a repurchase agreement, a lender files for bankruptcy, the Company might experience difficulty recovering its pledged assets, which could result in an unsecured claim against the lender for the difference between the amount loaned to the Company plus interest due to the counterparty and the fair value of the collateral pledged to such lender, including the accrued interest receivable, and cash posted by the Company as collateral, if any. At June 30, ~~2015~~2016 and December 31, ~~2014,~~2015, the Company had an aggregate amount at risk (the difference between the amount loaned to the Company, including interest payable, and the fair value of securities and cash pledged (if any), including accrued interest on such securities) with all counterparties of approximately ~~$7.0~~$5.9 million and ~~$6.7~~$3.5 million, respectively. ~~Summary information regarding amounts~~The Company did not have an amount at risk with any individual ~~counterparties~~counterparty greater than 10% of ~~stockholders’~~the Company's equity at June 30, ~~2015 and~~2016 or December 31, ~~2014 is as follows:~~2015.

($ in thousands)
% of Weighted
Stockholders' Average
Amount Equity Maturity
Repurchase Agreement Counterparties at Risk at Risk (in Days)
June 30, 2015
Citigroup Global Markets, Inc. $ 2,532 39.8 % 14
JVB Financial Group, LLC 1,517 23.9 % 10
ED&F Man Capital Markets Inc. 1,465 23.0 % 33
South Street Securities, LLC 812 12.8 % 20
CRT Capital Group, LLC 685 10.8 % 15
December 31, 2014
JVB Financial Group, LLC $ 1,807 19.6 % 8
ED&F Man Capital Markets Inc. 1,490 16.2 % 22

NOTE 5. DERIVATIVE FINANCIAL INSTRUMENTS

In connection with its interest rate risk management strategy, the Company economically hedges a portion of the cost of its repurchase agreement funding and junior subordinated notes by entering into derivatives ~~such as~~and other hedging contracts. To date the Company has entered into Eurodollar and T-Note futures contracts, ~~and interest rate swaptions,~~ but may enter into other contracts in the future. The Company has not elected hedging treatment under GAAP, and as such all gains or losses (realized and unrealized) on these instruments are reflected in earnings for all periods presented.

As of June 30, ~~2015~~2016 and December 31, ~~2014,~~2015, such instruments were comprised entirely of Eurodollar futures contracts. Eurodollar futures are cash settled futures contracts on an interest rate, with gains or losses credited or charged to the ~~Company’s~~Company's account on a daily basis and reflected in earnings as they occur. A minimum balance, or ~~“margin”~~"margin", is required to be maintained in the account on a daily basis. The Company is exposed to the changes in value of the futures by the amount of margin held by the broker. This margin represents the collateral the Company has posted for its open positions and is recorded on the consolidated balance sheets as part of restricted cash.

During the six months ended June 30, 2014, the Company, through Orchid, was a party to interest rate swaption agreements which granted the Company the right but not the obligation to enter into underlying pay fixed interest rate swap (“payer swaption”). The Company may also enter into swaption agreements that provide the Company the option to enter into a receive fixed interest rate swap (“receiver swaption”).

~~-13-~~-12-

Eurodollar and T-Note futures are cash settled futures contracts on an interest rate, with gains and losses credited or charged to the Company's cash accounts on a daily basis. A minimum balance, or "margin", is required to be maintained in the account on a daily basis. The tables below present information related to the ~~Company’s~~Company's Eurodollar futures positions at June 30, ~~2015~~2016 and December 31, ~~2014.~~

($ in thousands)
As of June 30, 2015
Repurchase Agreement Funding Hedges
Average Weighted Weighted
Contract Average Average
Notional Entry Effective Open
Expiration Year Amount Rate Rate
Equity(1)

2015 $ 43,000 0.79 % 0.48 % $ (67 )
2016 56,000 1.45 % 1.04 % (231 )
2017 56,000 2.23 % 1.81 % (239 )
2018 56,000 2.65 % 2.23 % (118 )
Total / Weighted Average $ 53,833 1.84 % 1.44 % $ (655 )
2015.

($ in thousands)
As of June 30, 2016
	Repurchase Agreement Funding Hedges
	Average		Weighted			Weighted
	Contract		Average			Average
	Notional		Entry			Effective			Open
Expiration Year	Amount		Rate			Rate			Equity⁽¹⁾
2016	$	56,000		1.76	%		0.66	%	$	(307	)
2017		56,000		2.23	%		0.75	%		(827	)
2018		43,000		2.21	%		0.92	%		(552	)
2019		30,000		1.63	%		1.15	%		(146	)
Total / Weighted Average	$	44,857		2.03	%		0.86	%	$	(1,832	)

($ in thousands)
As of June 30, 2015
As of June 30, 2016
	Junior Subordinated Debt Funding Hedges											Junior Subordinated Debt Funding Hedges
	Average		Weighted			Weighted						Average		Weighted			Weighted
	Contract		Average			Average						Contract		Average			Average
	Notional		Entry			Effective			Open			Notional		Entry			Effective			Open
Expiration Year	Amount		Rate			Rate			Equity(1)			Amount		Rate			Rate			Equity⁽¹⁾
2015	$	26,000		1.65	%		0.45	%	$	(156	)
2016		26,000		1.77	%		1.04	%		(189	)	$	26,000		1.85	%		0.66	%	$	(154	)
2017		26,000		2.49	%		1.81	%		(177	)		26,000		2.49	%		0.75	%		(450	)
2018		26,000		2.94	%		2.23	%		(93	)		26,000		2.16	%		0.94	%		(319	)
2019													26,000		1.65	%		1.15	%		(130	)
2020													26,000		1.95	%		1.39	%		(146	)
2021													26,000		2.22	%		1.62	%		(155	)
Total / Weighted Average	$	26,000		2.18	%		1.39	%	$	(615	)	$	26,000		2.07	%		1.12	%	$	(1,354	)

($ in thousands)
As of December 31, 2015
	Repurchase Agreement Funding Hedges
	Average		Weighted			Weighted
	Contract		Average			Average
	Notional		Entry			Effective			Open
Expiration Year	Amount		Rate			Rate			Equity⁽¹⁾
2016	$	56,000		1.45	%		0.98	%	$	(264	)
2017		56,000		2.23	%		1.59	%		(362	)
2018		56,000		2.65	%		1.91	%		(207	)
Total / Weighted Average	$	56,000		2.00	%		1.41	%	$	(833	)

($ in thousands)
As of December 31, 2014
Repurchase Agreement Funding Hedges
Average Weighted Weighted
Contract Average Average
Notional Entry Effective Open
Expiration Year Amount Rate Rate
Equity(1)

2015 $ 36,500 0.65 % 0.63 % $ (5 )
2016 56,000 1.45 % 1.54 % 46
2017 56,000 2.23 % 2.23 % (3 )
2018 56,000 2.65 % 2.51 % (38 )
Total / Weighted Average $ 50,429 1.72 % 1.72 % $ -

~~-14-~~-13-

($ in thousands)
As of December 31, 2014
As of December 31, 2015
	Junior Subordinated Debt Funding Hedges											Junior Subordinated Debt Funding Hedges
	Average		Weighted			Weighted						Average		Weighted			Weighted
	Contract		Average			Average						Contract		Average			Average
	Notional		Entry			Effective			Open			Notional		Entry			Effective			Open
Expiration Year	Amount		Rate			Rate			Equity(1)			Amount		Rate			Rate			Equity⁽¹⁾
2015	$	26,000		1.48	%		0.57	%	$	(237	)
2016		26,000		1.77	%		1.54	%		(61	)	$	26,000		1.77	%		0.98	%	$	(205	)
2017		26,000		2.49	%		2.23	%		(67	)		26,000		2.49	%		1.59	%		(234	)
2018		26,000		2.94	%		2.51	%		(56	)		26,000		2.94	%		1.91	%		(134	)
Total / Weighted Average	$	26,000		2.06	%		1.60	%	$	(421	)	$	26,000		2.29	%		1.41	%	$	(573	)

(1)	Open equity represents the cumulative ~~gains (losses)~~losses recorded on open futures positions from inception.

~~Loss (Gain)~~(Losses)/Gains From Derivative Instruments, Net

The table below presents the effect of the ~~Company’s~~Company's derivative financial instruments on the consolidated statements of operations for the six and three months ended June 30, ~~2015~~2016 and ~~2014. The consolidated information for 2014 includes the activity of Orchid, as it was included in the consolidated statements of operations for those periods.~~

2015.

(in thousands)
Consolidated Parent-Only
Six Months Ended June 30, 2015 2014 2015 2014
Eurodollar futures contracts (short positions) $ (1,009 ) $ (6,306 ) $ (1,009 ) $ (170 )
Payer swaptions - (1,285 ) - -
Net losses on derivative instruments $ (1,009 ) $ (7,591 ) $ (1,009 ) $ (170 )

(in thousands)
	Six Months Ended June 30,						Three Months Ended June 30,
	2016			2015			2016			2015
Eurodollar futures contracts (short positions)	$	(2,057	)	$	(1,009	)	$	(758	)	$	6
Net (losses) gains on derivative instruments	$	(2,057	)	$	(1,009	)	$	(758	)	$	6

(in thousands)
Consolidated Parent-Only
Three Months Ended June 30, 2015 2014 2015 2014
Eurodollar futures contracts (short positions) $ 6 $ (4,745 ) $ 6 $ (146 )
Payer swaptions - (1,129 ) - -
Net gains (losses) on derivative instruments $ 6 $ (5,874 ) $ 6 $ (146 )

Credit Risk-Related Contingent Features

The use of derivatives creates exposure to credit risk relating to potential losses that could be recognized in the event that the counterparties to these instruments fail to perform their obligations under the contracts. ~~We attempt~~The Company attempts to minimize this risk ~~by limiting our counterparties for~~in several ways. For instruments which are not centrally cleared on a registered exchange, the Company limits its counterparties to major financial institutions with acceptable credit ratings, and by monitoring positions with individual counterparties. In addition, wethe Company may be required to pledge assets as collateral for ~~our~~its derivatives, whose amounts vary over time based on the market value, notional amount and remaining term of the derivative contract. In the event of a default by a counterparty, wethe Company may not receive payments provided for under the terms of ~~our~~its derivative agreements, and may have difficulty obtaining ~~our~~its assets pledged as collateral for ~~our~~its derivatives. The cash and cash equivalents pledged as collateral for ~~our~~the Company's derivative instruments are included in restricted cash on the consolidated balance sheets.

-14-

NOTE 6. PLEDGED ASSETS

Assets Pledged to Counterparties

The table below summarizes our assets pledged as collateral under our repurchase agreements and derivative agreements pledged related to securities sold but not yet settled, as of June 30, 2016 and December 31, 2015.

($ in thousands)
As of June 30, 2016
	Repurchase		Derivative
Assets Pledged to Counterparties	Agreements		Agreements		Total
PT MBS - at fair value	$	107,774	$	-	$	107,774
Structured MBS - at fair value		1,591		-		1,591
Accrued interest on pledged securities		367		-		367
Cash		-		563		563
Total	$	109,732	$	563	$	110,295

($ in thousands)
As of December 31, 2015
	Repurchase		Derivative
Assets Pledged to Counterparties	Agreements		Agreements		Total
PT MBS - at fair value	$	79,288	$	-	$	79,288
Structured MBS - at fair value		1,904		-		1,904
Accrued interest on pledged securities		272		-		272
Cash		-		402		402
Total	$	81,464	$	402	$	81,866

Assets Pledged from Counterparties

The table below summarizes our assets pledged to us from counterparties under our repurchase agreements as of June 30, 2016 and December 31, 2015. Cash received as margin is recognized in cash and cash equivalents with a corresponding amount recognized as an increase in repurchase agreements in the consolidated balance sheets.

($ in thousands)
Assets Pledged to Bimini	June 30, 2016		December 31, 2015
Cash	$	87	$	-
Total	$	87	$	-

-15-

NOTE 6.7. OFFSETTING ASSETS AND LIABILITIES

The ~~Company’s~~Company's derivatives and repurchase agreements are subject to underlying agreements with master netting or similar arrangements, which provide for the right of offset in the event of default or in the event of bankruptcy of either party to the transactions. The Company reports its assets and liabilities subject to these arrangements on a gross basis. The following table presents information regarding those assets and liabilities subject to such arrangements as if the Company had presented them on a net basis as of June 30, ~~2015~~2016 and December 31, ~~2014.~~2015.

(in thousands)
Offsetting of Liabilities
Gross Amount Not Offset in the
Net Amount Consolidated Balance Sheet
Gross Amount of Liabilities Financial
Gross Amount Offset in the Presented in the Instruments Cash
of Recognized Consolidated Consolidated Posted as Posted as Net
Liabilities Balance Sheet Balance Sheet Collateral Collateral Amount
June 30, 2015
Repurchase Agreements $ 101,206 $ - $ 101,206 $ (99,146 ) $ (2,060 ) $ -
December 31, 2014
Repurchase Agreements $ 109,964 $ - $ 109,964 $ (109,706 ) $ (258 ) $ -

(in thousands)
Offsetting of Liabilities
										Gross Amount Not Offset in the
							Net Amount			Consolidated Balance Sheet
				Gross Amount			of Liabilities			Financial
	Gross Amount			Offset in the			Presented in the			Instruments				Cash
	of Recognized			Consolidated			Consolidated			Posted as				Posted as			Net
	Liabilities			Balance Sheet			Balance Sheet			Collateral				Collateral			Amount
June 30, 2016
Repurchase Agreements		$	103,725		$	-		$	103,725		$	(103,725	)		$	-		$	-
December 31, 2015
Repurchase Agreements		$	77,234		$	-		$	77,234		$	(77,234	)		$	-		$	-

The amounts disclosed for collateral received by or posted to the same counterparty are limited to the amount sufficient to reduce the asset or liability presented in the consolidated balance sheet to zero in accordance with ASU No. 2011-11, as amended by ASU No. 2013-01. The fair value of the actual collateral received by or posted to the same counterparty typically exceeds the amounts presented. See ~~Notes 4 and 5~~Note 6 for a discussion of collateral posted for, or received against, repurchase obligations and derivative instruments.

NOTE 7.8. TRUST PREFERRED SECURITIES

During 2005, Bimini Capital sponsored the formation of a statutory trust, known as Bimini Capital Trust II ~~(“BCTII”~~("BCTII") of which 100% of the common equity is owned by Bimini Capital. It was formed for the purpose of issuing trust preferred capital securities to third-party investors and investing the proceeds from the sale of such capital securities solely in junior subordinated debt securities of Bimini Capital. The debt securities held by BCTII are the sole assets of BCTII.

As of June 30, ~~2015~~2016 and December 31, ~~2014,~~2015, the outstanding principal balance on the junior subordinated debt securities owed to BCTII was $26.8 million. The BCTII trust preferred securities and Bimini Capital's BCTII Junior Subordinated Notes have a rate of interest that floats at a spread of 3.50% over the prevailing three-month LIBOR rate. As of June 30, ~~2015,~~2016, the interest rate was ~~3.79%~~4.15%. The BCTII trust preferred securities and Bimini Capital's BCTII Junior Subordinated Notes require quarterly interest distributions and ~~became~~are redeemable at Bimini Capital's option, in whole or in part and without ~~penalty, beginning December 15, 2010.~~penalty. Bimini Capital's BCTII Junior Subordinated Notes are subordinate and junior in right of payment of all present and future senior indebtedness.

BCTII is a VIE because the holders of the equity investment at risk do not have adequate decision making ability over ~~BCTII’s~~BCTII's activities. Since Bimini Capital's investment in ~~BCTII’s~~BCTII's common equity securities was financed directly by BCTII as a result of its loan of the proceeds to Bimini Capital, that investment is not considered to be an equity investment at risk. Since Bimini Capital's common share investment in BCTII is not a variable interest, Bimini Capital is not the primary beneficiary of BCTII. Therefore, Bimini Capital has not consolidated the financial statements of BCTII into its consolidated financial statements.

~~-16-~~

The accompanying consolidated financial statements present Bimini Capital's BCTII Junior Subordinated Notes issued to BCTII as a liability and Bimini Capital's investment in the common equity securities of BCTII as an asset (included in other assets). For financial statement purposes, Bimini Capital records payments of interest on the Junior Subordinated Notes issued to BCTII as interest expense.

-16-

NOTE 8.9. COMMON STOCK

~~At June 30, 2015 and December 31, 2014, Bimini Capital’s common stock is comprised of the following:~~

June 30, 2015 December 31, 2014
Preferred stock, $0.001 par value; 10,000,000 shares authorized; designated, 1,800,000
shares as Class A Redeemable and 2,000,000 shares as Class B Redeemable; no
shares issued and outstanding as of June 30, 2015 and December 31, 2014 $ - $ -
Class A Common Stock, $0.001 par value; 98,000,000 shares designated: 12,346,376
shares issued and outstanding as of June 30, 2015 and 12,324,391 shares
issued and outstanding as of December 31, 2014 12,346 12,324
Class B Common Stock, $0.001 par value; 1,000,000 shares designated, 31,938 shares
issued and outstanding as of June 30, 2015 and December 31, 2014 32 32
Class C Common Stock, $0.001 par value; 1,000,000 shares designated, 31,938 shares
issued and outstanding as of June 30, 2015 and December 31, 2014 32 32
$ 12,410 $ 12,388

~~Issuances of Common Stock~~

The table below presents information related to ~~the~~ Bimini ~~Capital’s~~Capital's Class A Common Stock issued during the six and three months ended June 30, ~~2015~~2016 and ~~2014.~~

Shares Issued Related To: 2015 2014
Directors' compensation 21,985 27,531
Vesting incentive plan shares(1)
- 500,000
Shares sold directly to employees(1)
- 257,895
Total shares of Class A Common Stock issued 21,985 785,426
2015.

~~(1)~~

~~See Note 9, Stock Incentive Plans, for details of these issuances.~~

	Six Months Ended June 30,				Three Months Ended, June 30,
Shares Issued Related To:	2016		2015		2016		2015
Directors' compensation		-		21,985		-		13,870
Vested incentive plan shares		258,333		-		-		-
Total shares of Class A Common Stock issued		258,333		21,985		-		13,870

There were no issuances of Bimini Capital's Class B Common Stock and Class C Common Stock during the six months ended June 30, ~~2015~~2016 and ~~2014.~~2015.

NOTE 9.10. STOCK INCENTIVE PLANS

On August 12, 2011, Bimini ~~Capital’s~~Capital's shareholders approved the 2011 Long Term Compensation Plan (the ~~“2011 Plan”~~"2011 Plan") to assist the Company in recruiting and retaining employees, directors and other service providers by enabling them to participate in the success of Bimini Capital and to associate their interests with those of the Company and its stockholders. The 2011 ~~plan~~Plan is intended to permit the grant of stock options, stock appreciation rights ~~(“SARs”~~("SARs"), stock awards, performance units and other equity-based and incentive awards. The maximum aggregate number of shares of ~~Common Stock~~common stock that may be issued under the 2011 Plan pursuant to the exercise of options and SARs, the grant of stock awards or other equity-based awards and the settlement of incentive awards and performance units is equal to 4,000,000 shares.

~~-17-~~

Share Awards

~~In February 2014,~~During the three months ended March 31, 2016, the Compensation Committee of the Board of Directors of Bimini Capital (the ~~“Committee”~~"Committee") approved certain performance bonuses for members of management. These bonuses were awarded primarily in recognition of ~~management’s capital raising efforts~~service in ~~2013.~~2015. The bonuses ~~which were paid on February 19, 2014 (the “Bonus Date”),~~ consisted of cash of approximately $0.5 million and 258,333 fully vested shares of the ~~Company’s common stock~~Company's Class A Common Stock with an approximate value of $0.2 million, or $0.75 per share. The shares were issued under the 2011 Plan. In particular, executive officers received bonuses totaling approximately $422,000, consisting of 500,000 shares of the Company’s common stock with an approximate value of $190,000, and cash of approximately $232,000 which, at the officer’s election, could be used to purchase newly issued shares directly from the Company. Under this election, the officers purchased 257,895 shares of the Company’s common stock. For purposes of these bonuses, shares of the ~~Company’s~~Company's common stock were valued based on the closing price of the ~~Company’s common stock~~Company's Class A Common Stock on January 15, 2016, the ~~Bonus Date.~~bonus date. The expense related to this bonus was accrued at December 31, ~~2013~~2015 and does not affect the results of operations for the six and three months ended June 30, ~~2014.~~2016.

~~A summary of share award activity during the six months ended June 30, 2014 is presented below:~~

Weighted-
Average
Grant-Date
Shares Fair Value
Fully vested shares granted 500,000 $ 0.38

June 30, 2015 December 31, 2014
Nonvested performance units outstanding at period end 31,500 31,500
Weighted-average grant date fair price $ 1.78 $ 1.78
Unrecognized compensation expense at period end $ 45,946 $ 55,291
Weighted-average remaining vesting term (in years) 2.50 3.00
Intrinsic value of unvested shares at period end $ 88,200 $ 59,850

(in thousands)
Quoted Prices
in Active Significant
Markets for Other Significant
Identical Observable Unobservable
Fair Value Assets Inputs Inputs
Measurements (Level 1) (Level 2) (Level 3)
June 30, 2015
Mortgage-backed securities $ 107,761 $ - $ 107,761 $ -
Eurodollar futures contracts 488 488 - -
Orchid Island Capital, Inc. common stock 11,004 11,004 - -
Retained interests 2,141 - - 2,141
December 31, 2014
Mortgage-backed securities $ 117,831 $ - $ 117,831 $ -
Eurodollar futures contracts 476 476 - -
Orchid Island Capital, Inc. common stock 12,811 12,811 - -
Retained interests 1,900 - - 1,900

(in thousands)
Six Months Ended June 30, Three Months Ended June 30,
2015
2014(1)
Change 2015
2014(1)
Change
Net portfolio interest $ 2,083 $ 10,053 $ (7,970 ) $ 976 $ 6,391 $ (5,415 )
Interest expense on junior subordinated notes (491 ) (489 ) (2 ) (248 ) (245 ) (3 )
(Losses) gains on MBS and derivative instruments (1,207 ) 7,725 (8,932 ) (1,021 ) 6,804 (7,825 )
Net portfolio income (loss) 385 17,289 (16,904 ) (293 ) 12,950 (13,243 )
Other income 3,639 2,426 1,213 594 2,243 (1,649 )
Expenses, including income taxes (6,917 ) (1,478 ) (5,439 ) (1,805 ) (2,279 ) 474
Net (loss) income (2,893 ) 18,237 (21,130 ) (1,504 ) 12,914 (14,418 )
Income attributable to
noncontrolling interests - 12,538 (12,538 ) - 9,584 (9,584 )
Net (loss) income attributable to
Bimini Capital Management, Inc. $ (2,893 ) $ 5,699 $ (8,592 ) $ (1,504 ) $ 3,330 $ (4,834 )

The Company has not elected to designate its derivative holdings for hedge accounting treatment under the Financial Accounting Standards Board, (the ~~“FASB”~~"FASB"), Accounting Standards Codification, ~~(“ASC”~~("ASC"), Topic 815, Derivatives and Hedging. Changes in fair value of these instruments are presented in a separate line item in the ~~Company’s~~Company's consolidated statements of operations and not included in interest expense. As such, for financial reporting purposes, interest expense and cost of funds are not impacted by the fluctuation in value of the derivative instruments. In the future, the Company may use other derivative instruments to hedge its interest expense and/or elect to designate its derivative holdings for hedge accounting treatment.

For the purpose of computing economic net interest income and ratios relating to cost of funds measures, GAAP interest expense has been adjusted to reflect the realized gains or losses on specific derivative instruments that pertain to each period presented. As of June 30, ~~2015,~~2016, the Company has Eurodollar futures contracts in place through ~~2018.~~2021. Adjusting our interest expense for the periods presented by the gains or losses on all derivative instruments would not accurately reflect our economic interest expense for these periods.

For each period presented, the Company has combined the effects of the derivative financial instruments in place for the respective period with the actual interest expense incurred on repurchase agreements and junior subordinated notes to reflect total expense for the applicable period. Interest expense, including the effect of derivative instruments for the period, is referred to as economic interest expense. Net interest income, when calculated to include the effect of derivative instruments for the period, is referred to as economic net interest income.

However, because the Company has not elected hedging treatment under ASC Topic 815, the gains or losses on all of the ~~Company’s~~Company's derivative instruments held during the period are reflected in our consolidated statements of operations. This presentation includes gains or losses on all contracts in effect during the reporting period, including those covering both the current period as well as future periods.

The Company believes that economic interest expense and economic net interest income provides meaningful information to consider, in addition to the respective amounts prepared in accordance with GAAP. The non-GAAP measures help the Company to evaluate its financial position and performance without the effects of certain transactions and GAAP adjustments that are not necessarily indicative of its current investment portfolio or operations. The realized and unrealized gains or losses presented in the ~~Company’s~~Company's consolidated statements of operations are not necessarily representative of the total interest rate expense that the Company will ultimately realize. This is because as interest rates move up or down in the future, the gains or losses the Company ultimately realizes, and which will affect the ~~Company’s~~Company's total interest rate expense in future periods, may differ from the unrealized gains or losses recognized as of the reporting date.

The ~~Company’s~~Company's presentation of the economic value of its hedging strategy has important limitations. First, other market participants may calculate economic interest expense and economic net interest income differently than the Company calculates them. Second, while the Company believes that the calculation of the economic value of our hedging strategy described above helps to present our financial position and performance, it may be of limited usefulness as an analytical tool. Therefore, the economic value of the ~~Company’s~~Company's investment strategy should not be viewed in isolation and is not a substitute for interest expense and net interest income computed in accordance with GAAP.

~~-30-~~-26-

The tables below present a reconciliation of the adjustments to interest expense shown for each period relative to our derivative instruments, and the consolidated statements of operations line item, losses on derivative instruments, calculated in accordance with GAAP for the six months ended June 30, ~~2015 and 2014~~2016 and for each quarter in ~~2015~~2016 and ~~2014.~~2015.

Gains (Losses) on Derivative Instruments - Recognized in Consolidated Statement of Operations (GAAP)
(in thousands)
Junior
Repurchase Subordinated
Three Months Ended Agreements Debt Total
Consolidated
June 30, 2015 $ 7 $ (1 ) $ 6
March 31, 2015 (687 ) (328 ) (1,015 )
December 31, 2014 (9,719 ) (287 ) (10,006 )
September 30, 2014 3,257 149 3,406
June 30, 2014 (5,757 ) (117 ) (5,874 )
March 31, 2014 (1,693 ) (24 ) (1,717 )
Bimini Capital Only
June 30, 2015 $ 7 $ (1 ) $ 6
March 31, 2015 (687 ) (328 ) (1,015 )
December 31, 2014 (158 ) (287 ) (445 )
September 30, 2014 200 149 349
June 30, 2014 (29 ) (117 ) (146 )
March 31, 2014 - (24 ) (24 )

(in thousands)
Junior
Repurchase Subordinated
Six Months Ended Agreements Debt Total
Consolidated
June 30, 2015 $ (680 ) $ (329 ) $ (1,009 )
June 30, 2014 (7,450 ) (141 ) (7,591 )
Bimini Capital Only
June 30, 2015 $ (680 ) $ (329 ) $ (1,009 )
June 30, 2014 (29 ) (141 ) (170 )

Gains (Losses) on Derivative Instruments - Recognized in Consolidated Statement of Operations (GAAP)
(in thousands)
				Junior
	Repurchase			Subordinated
Three Months Ended	Agreements			Debt			Total
Consolidated
June 30, 2016	$	(353	)	$	(404	)	$	(757	)
March 31, 2016		(787	)		(513	)		(1,300	)
December 31, 2015		426			197			623
September 30, 2015		(676	)		(315	)		(991	)
June 30, 2015		7			(1	)		6
March 31, 2015		(687	)		(328	)		(1,015	)

(in thousands)
				Junior
	Repurchase			Subordinated
Six Months Ended	Agreements			Debt			Total
Consolidated
June 30, 2016	$	(1,140	)	$	(917	)	$	(2,057	)
June 30, 2015		(680	)		(329	)		(1,009	)

Losses on Derivative Instruments - Attributed to Current Period (Non-GAAP)
(in thousands)
				Junior
	Repurchase			Subordinated
Three Months Ended	Agreements			Debt			Total
Consolidated
June 30, 2016	$	(60	)	$	(77	)	$	(137	)
March 31, 2016		(45	)		(80	)		(125	)
December 31, 2015		(31	)		(80	)		(111	)
September 30, 2015		(20	)		(74	)		(94	)
June 30, 2015		(9	)		(64	)		(73	)
March 31, 2015		(1	)		(54	)		(55	)

(in thousands)
				Junior
	Repurchase			Subordinated
Six Months Ended	Agreements			Debt			Total
Consolidated
June 30, 2016	$	(105	)	$	(157	)	$	(262	)
June 30, 2015		(10	)		(118	)		(128	)

~~-31-~~-27-

Gains (Losses) on Derivative Instruments - Attributed to Future Periods (Non-GAAP)
(in thousands)
				Junior
	Repurchase			Subordinated
Three Months Ended	Agreements			Debt			Total
Consolidated
June 30, 2016	$	(293	)	$	(327	)	$	(620	)
March 31, 2016		(742	)		(433	)		(1,175	)
December 31, 2015		457			277			734
September 30, 2015		(656	)		(241	)		(897	)
June 30, 2015		16			63			79
March 31, 2015		(686	)		(274	)		(960	)

(in thousands)
				Junior
	Repurchase			Subordinated
Six Months Ended	Agreements			Debt			Total
Consolidated
June 30, 2016	$	(1,035	)	$	(760	)	$	(1,795	)
June 30, 2015		(670	)		(211	)		(881	)

Losses on Derivative Instruments - Attributed to Current Period (Non-GAAP)
(in thousands)
Junior
Repurchase Subordinated
Three Months Ended Agreements Debt Total
Consolidated
June 30, 2015 $ (9 ) $ (64 ) $ (73 )
March 31, 2015 (1 ) (54 ) (55 )
December 31, 2014 (145 ) (136 ) (281 )
September 30, 2014 (24 ) (141 ) (165 )
June 30, 2014 (3 ) (127 ) (130 )
March 31, 2014 (136 ) (109 ) (245 )
Bimini Capital Only
June 30, 2015 $ (9 ) $ (64 ) $ (73 )
March 31, 2015 (1 ) (54 ) (55 )
December 31, 2014 - (136 ) (136 )
September 30, 2014 - (141 ) (141 )
June 30, 2014 - (127 ) (127 )
March 31, 2014 (106 ) (109 ) (215 )

(in thousands)
Junior
Repurchase Subordinated
Six Months Ended Agreements Debt Total
Consolidated
June 30, 2015 $ (10 ) $ (118 ) $ (128 )
June 30, 2014 (139 ) (236 ) (375 )
Bimini Capital Only
June 30, 2015 $ (10 ) $ (118 ) $ (128 )
June 30, 2014 (106 ) (236 ) (342 )

Gains (Losses) on Derivative Instruments - Attributed to Future Periods (Non-GAAP)
(in thousands)
Junior
Repurchase Subordinated
Three Months Ended Agreements Debt Total
Consolidated
June 30, 2015 $ 16 $ 63 $ 79
March 31, 2015 (686 ) (274 ) (960 )
December 31, 2014 (9,574 ) (151 ) (9,725 )
September 30, 2014 3,281 290 3,571
June 30, 2014 (5,754 ) 10 (5,744 )
March 31, 2014 (1,557 ) 85 (1,472 )
Bimini Capital Only
June 30, 2015 $ 16 $ 63 $ 79
March 31, 2015 (686 ) (274 ) (960 )
December 31, 2014 (158 ) (151 ) (309 )
September 30, 2014 199 290 489
June 30, 2014 (29 ) 10 (19 )
March 31, 2014 106 85 191

~~-32-~~

(in thousands)
Junior
Repurchase Subordinated
Six Months Ended Agreements Debt Total
Consolidated
June 30, 2015 $ (670 ) $ (211 ) $ (881 )
June 30, 2014 (7,311 ) 95 (7,216 )
Bimini Capital Only
June 30, 2015 $ (670 ) $ (211 ) $ (881 )
June 30, 2014 77 95 172

Economic Net Portfolio Interest Income
(in thousands)
Interest Expense on Repurchase Agreements Net Portfolio
Effect of Interest Income
Interest GAAP Non-GAAP Economic GAAP Economic
Three Months Ended Income Basis
Hedges(1)

Basis(2)
Basis
Basis(3)

Consolidated
June 30, 2015 $ 1,074 $ 98 $ (9 ) $ 107 $ 976 $ 967
March 31, 2015 1,207 100 (1 ) 101 1,107 1,106
December 31, 2014 13,168 1,213 (145 ) 1,358 11,955 11,810
September 30, 2014 10,035 886 (24 ) 910 9,149 9,125
June 30, 2014 7,119 728 (3 ) 731 6,391 6,388
March 31, 2014 4,116 454 (136 ) 590 3,662 3,526
Bimini Capital Only
June 30, 2015 $ 1,074 $ 98 $ (9 ) $ 107 $ 976 $ 967
March 31, 2015 1,207 100 (1 ) 101 1,107 1,106
December 31, 2014 1,022 87 1 86 935 936
September 30, 2014 749 67 - 67 682 682
June 30, 2014 530 52 (1 ) 53 478 477
March 31, 2014 333 43 (106 ) 149 290 184

(in thousands)
Interest Expense on Repurchase Agreements Net Portfolio
Effect of Interest Income
Interest GAAP Non-GAAP Economic GAAP Economic
Six Months Ended Income Basis
Hedges(1)

Basis(2)
Basis
Basis(3)

Consolidated
June 30, 2015 $ 2,281 $ 198 $ (10 ) $ 208 $ 2,083 $ 2,073
June 30, 2014 11,235 1,182 (139 ) 1,321 10,053 9,914
Bimini Capital Only
June 30, 2015 $ 2,281 $ 198 $ (10 ) $ 208 $ 2,083 $ 2,073
June 30, 2014 863 95 (107 ) 202 768 661

Economic Net Portfolio Interest Income
(in thousands)
			Interest Expense on Repurchase Agreements							Net Portfolio
					Effect of					Interest Income
	Interest		GAAP		Non-GAAP			Economic		GAAP		Economic
Three Months Ended	Income		Basis		Hedges⁽¹⁾			Basis⁽²⁾		Basis		Basis⁽³⁾
Consolidated
June 30, 2016	$	1,025	$	174	$	(60	)	$	234	$	851	$	791
March 31, 2016		817		127		(45	)		172		690		645
December 31, 2015		1,035		120		(31	)		151		915		884
September 30, 2015		996		107		(20	)		127		889		869
June 30, 2015		1,074		98		(9	)		107		976		967
March 31, 2015		1,207		100		(1	)		101		1,107		1,106

(in thousands)
			Interest Expense on Repurchase Agreements							Net Portfolio
					Effect of					Interest Income
	Interest		GAAP		Non-GAAP			Economic		GAAP		Economic
Six Months Ended	Income		Basis		Hedges⁽¹⁾			Basis⁽²⁾		Basis		Basis⁽³⁾
Consolidated
June 30, 2016	$	1,842	$	301	$	(105	)	$	406	$	1,541	$	1,436
June 30, 2015		2,281		198		(10	)		208		2,083		2,073

(1)	Reflects the effect of derivative instrument hedges for only the period presented.

(2)	Calculated by ~~adding~~subtracting the effect of derivative instrument hedges attributed to the period presented from GAAP interest expense.

(3)	Calculated by ~~subtracting~~adding the effect of derivative instrument hedges attributed to the period presented to GAAP net portfolio interest income.

~~-33-~~-28-

Economic Net Interest Income
(in thousands)
Net Portfolio Interest Expense on Junior Subordinated Notes
Interest Income Effect of Net Interest Income
GAAP Economic GAAP Non-GAAP Economic GAAP Economic
Three Months Ended Basis
Basis(1)
Basis
Hedges(2)

Basis(3)
Basis
Basis(4)

Consolidated
June 30, 2015 $ 976 $ 967 $ 248 $ (64 ) $ 312 $ 728 $ 655
March 31, 2015 1,107 1,106 243 (54 ) 297 864 809
December 31, 2014 11,955 11,810 248 (136 ) 384 11,707 11,426
September 30, 2014 9,149 9,125 248 (141 ) 389 8,901 8,736
June 30, 2014 6,391 6,388 245 (127 ) 372 6,146 6,016
March 31, 2014 3,662 3,526 243 (109 ) 352 3,419 3,174
Bimini Capital Only
June 30, 2015 $ 976 $ 967 $ 248 $ (64 ) $ 312 $ 728 $ 655
March 31, 2015 1,107 1,106 243 (54 ) 297 864 809
December 31, 2014 935 935 248 (136 ) 384 687 551
September 30, 2014 682 682 248 (141 ) 389 434 293
June 30, 2014 478 478 245 (127 ) 372 233 106
March 31, 2014 290 184 243 (109 ) 352 47 (168 )

(in thousands)
Net Portfolio Interest Expense on Junior Subordinated Notes
Interest Income Effect of Net Interest Income
GAAP Economic GAAP Non-GAAP Economic GAAP Economic
Six Months Ended Basis
Basis(1)
Basis
Hedges(2)

Basis(3)
Basis
Basis(4)

Consolidated
June 30, 2015 $ 2,083 $ 2,073 $ 491 $ (118 ) $ 609 $ 1,592 $ 1,464
June 30, 2014 10,053 9,914 488 (236 ) 724 9,565 9,190
Bimini Capital Only
June 30, 2015 $ 2,083 $ 2,073 $ 491 $ (118 ) $ 609 $ 1,592 $ 1,464
June 30, 2014 768 662 488 (236 ) 724 280 (62 )

Economic Net Interest Income
(in thousands)
	Net Portfolio				Interest Expense on Junior Subordinated Notes
	Interest Income						Effect of					Net Interest Income
	GAAP		Economic		GAAP		Non-GAAP			Economic		GAAP		Economic
Three Months Ended	Basis		Basis⁽¹⁾		Basis		Hedges⁽²⁾			Basis⁽³⁾		Basis		Basis⁽⁴⁾
Consolidated
June 30, 2016	$	851	$	791	$	276	$	(77	)	$	353	$	575	$	438
March 31, 2016		690		645		264		(80	)		344		426		301
December 31, 2015		915		884		255		(80	)		335		660		549
September 30, 2015		889		869		252		(74	)		326		637		543
June 30, 2015		976		967		248		(64	)		312		728		655
March 31, 2015		1,107		1,106		243		(54	)		297		864		809

(in thousands)
	Net Portfolio				Interest Expense on Junior Subordinated Notes
	Interest Income						Effect of					Net Interest Income
	GAAP		Economic		GAAP		Non-GAAP			Economic		GAAP		Economic
Six Months Ended	Basis		Basis⁽¹⁾		Basis		Hedges⁽²⁾			Basis⁽³⁾		Basis		Basis⁽⁴⁾
Consolidated
June 30, 2016	$	1,541	$	1,436	$	540	$	(157	)	$	697	$	1,001	$	739
June 30, 2015		2,083		2,073		491		(118	)		609		1,592		1,464

(1)	Calculated by adding the effect of derivative instrument hedges attributed to the period presented to GAAP net portfolio interest income.

(2)	Reflects the effect of derivative instrument hedges for only the period presented.

(3)	Calculated by subtracting the effect of derivative instrument hedges attributed to the period presented from GAAP interest expense.

(4)	Calculated by subtracting the effect of derivative instrument hedges attributed to the period presented ~~from~~to GAAP net interest income.

Net Portfolio Income

During the six months ended June 30, 2016, the Company generated $1.5 million of net portfolio interest income, consisting of $1.8 million of interest income from MBS assets offset by $0.3 million of interest expense on repurchase liabilities. For the comparable period ended June 30, 2015, the Company generated $2.1 million of net portfolio interest income, consisting of $2.3 million of interest income from MBS assets offset by $0.2 million of interest expense on repurchase liabilities. For the comparable period ended June 30, 2014, the Company generated $10.1 million of net portfolio interest income, consisting of $11.2 million of interest income from MBS assets offset by $1.2 million of interest expense on repurchase liabilities. The ~~$8.9~~$0.5 million decrease in interest income ~~and $1 million decrease in interest expense~~ for the six months ended June 30, ~~2015 primarily reflects~~2016 was due to a combination of a 43 basis point decrease in yields earned on the ~~deconsolidation of Orchid’s assets and liabilities from the balance sheet beginning December 31, 2014~~portfolio and the ~~effect this had on the Company’s consolidated statement of operations.~~$10.9 million decrease in average MBS balances.

The ~~Company’s~~Company's economic interest expense on repurchase liabilities for the six months ended June 30, 2016 and 2015 ~~and 2014~~ was ~~$0.2~~$0.4 million and ~~$1.3~~$0.2 million, respectively, resulting in ~~$2.1~~$1.4 million and ~~$9.9~~$2.1 million of economic net portfolio interest income, respectively.

~~-34-~~

During the three months ended June 30, 2016, the Company generated $0.8 million of net portfolio interest income, consisting of $1.0 million of interest income from MBS assets offset by $0.2 million of interest expense on repurchase liabilities. For the three months ended June 30, 2015, the Company generated $1.0 million of net portfolio interest income, consisting of $1.1 million of interest income from MBS assets offset by $0.1 million of interest expense on repurchase liabilities. ~~For~~The $0.1 million decrease in interest income for the ~~three~~six months ended June 30, ~~2014, the Company generated $6.4 million~~2016 was due to a combination of net portfolio interest income, consisting of $7.1 million of interest income from MBS assets offset by $0.7 million of interest expense on repurchase liabilities. The deployment of the proceeds from Orchid’s capital raising activities in 2014 on a ~~leveraged~~12 basis ~~followed by the deconsolidation of Orchid as of December 31, 2014, were the main reasons for the~~point decrease in ~~both interest income~~yields earned on the portfolio and ~~interest expense for~~ the ~~three months ended June 30, 2015 as compared to the same period~~$1.7 million decrease in ~~2014.~~average MBS balances.

The ~~Company’s~~Company's economic interest expense on repurchase liabilities for the three months ended June 30, 2016 and 2015 ~~and 2014~~ was ~~$0.1~~$0.2 million and ~~$0.7~~$0.1 million, respectively, resulting in ~~$1.0~~$0.8 million and ~~$6.4~~$1.0 million of economic net portfolio interest income, respectively.

The discussion above and in the following sections related to the Company’s net portfolio income during the six and three months ended June 30, 2014 includes the activities of Orchid as a VIE. Orchid’s activities are not included for the six and three months June 30, 2015. During the six months ended June 30, 2015, Bimini Capital generated $2.1 million of net portfolio interest income, consisting of $2.3 million of interest income from MBS assets offset by $0.2 million of interest expense on repurchase liabilities. For the comparable period ended June 30, 2014, Bimini Capital generated $0.8 million of net portfolio interest income, consisting of $0.9 million of interest income from MBS assets offset by $0.1 million of interest expense on repurchase liabilities.

-29-

During the three months ended June 30, 2015, Bimini Capital generated $0.98 million of net portfolio interest income, consisting of $1.07 million of interest income from MBS assets offset by $0.10 million of interest expense on repurchase liabilities. For the three months ended June 30, 2014, Bimini Capital generated $0.48 million of net portfolio interest income, consisting of $0.53 million of interest income from MBS assets offset by $0.05 million of interest expense on repurchase liabilities.

The tables below provide consolidated information on our portfolio average balances, interest income, yield on assets, average repurchase agreement balances, interest expense, cost of funds, net interest income and net interest rate spread for the six months ended June 30, ~~2015~~2016 and ~~2014~~2015 and each quarter in ~~2015~~2016 and ~~2014~~2015 on both a GAAP and economic basis.

($ in thousands)
Average Yield on Average Interest Expense Average Cost of Funds
MBS Interest Average Repurchase GAAP Economic GAAP Economic
Three Months Ended
Held(1)

Income(2)
MBS
Agreements(1)
Basis
Basis(2)
Basis
Basis(3)

Consolidated
June 30, 2015 $ 111,674 $ 1,074 3.85 % $ 103,750 $ 98 $ 107 0.38 % 0.41 %
March 31, 2015 116,709 1,207 4.14 % 108,129 100 101 0.37 % 0.37 %
December 31, 2014 1,466,048 13,168 3.59 % 1,442,905 1,213 1,358 0.34 % 0.38 %
September 30, 2014 1,108,367 10,035 3.62 % 1,096,611 886 910 0.32 % 0.33 %
June 30, 2014 882,591 7,119 3.23 % 783,323 728 731 0.37 % 0.37 %
March 31, 2014 601,441 4,116 2.74 % 533,008 454 590 0.34 % 0.44 %
Bimini Capital Only
June 30, 2015 $ 111,674 $ 1,074 3.85 % $ 103,750 $ 98 $ 107 0.38 % 0.41 %
March 31, 2015 116,709 1,207 4.14 % 108,129 100 101 0.37 % 0.37 %
December 31, 2014 103,696 1,022 3.94 % 96,591 87 86 0.36 % 0.36 %
September 30, 2014 82,599 749 3.63 % 76,772 67 67 0.35 % 0.35 %
June 30, 2014 70,710 530 3.00 % 65,849 53 53 0.32 % 0.32 %
March 31, 2014 51,951 333 2.57 % 48,106 43 149 0.36 % 1.24 %

~~-35-~~

($ in thousands)
	Average				Yield on			Average		Interest Expense				Average Cost of Funds
	MBS		Interest		Average			Repurchase		GAAP		Economic		GAAP			Economic
Three Months Ended	Held⁽¹⁾		Income⁽²⁾		MBS			Agreements⁽¹⁾		Basis		Basis⁽²⁾		Basis			Basis⁽³⁾
Consolidated
June 30, 2016	$	110,017	$	1,025		3.73	%	$	103,259	$	174	$	234		0.67	%		0.91	%
March 31, 2016		96,592		817		3.39	%		90,014		127		172		0.57	%		0.77	%
December 31, 2015		103,551		1,035		4.00	%		95,456		120		151		0.50	%		0.63	%
September 30, 2015		115,437		996		3.45	%		107,442		107		127		0.40	%		0.47	%
June 30, 2015		111,674		1,074		3.85	%		103,750		98		107		0.38	%		0.41	%
March 31, 2015		116,709		1,207		4.14	%		108,129		100		101		0.37	%		0.37	%

($ in thousands)
	Average				Yield on			Average		Interest Expense				Average Cost of Funds
	MBS		Interest		Average			Repurchase		GAAP		Economic		GAAP			Economic
Six Months Ended	Held⁽¹⁾		Income⁽²⁾		MBS			Agreements⁽¹⁾		Basis		Basis⁽²⁾		Basis			Basis⁽³⁾
Consolidated
June 30, 2016	$	103,305	$	1,842		3.57	%	$	96,637	$	301	$	406		0.62	%		0.84	%
June 30, 2015		114,192		2,281		4.00	%		105,939		198		208		0.37	%		0.39	%

($ in thousands)
Average Yield on Average Interest Expense Average Cost of Funds
MBS Interest Average Repurchase GAAP Economic GAAP Economic
Six Months Ended
Held(1)

Income(2)
MBS
Agreements(1)
Basis
Basis(2)
Basis
Basis(3)

Consolidated
June 30, 2015 $ 114,192 $ 2,281 4.00 % $ 105,939 $ 198 $ 208 0.37 % 0.39 %
June 30, 2014 742,016 11,235 3.03 % 658,165 1,182 1,321 0.36 % 0.40 %
Bimini Capital Only
June 30, 2015 $ 114,192 $ 2,281 4.00 % $ 105,939 $ 198 $ 208 0.37 % 0.39 %
June 30, 2014 61,330 863 2.82 % 56,978 96 202 0.34 % 0.71 %

($ in thousands)
Net Portfolio Net Portfolio
Interest Income Interest Spread
GAAP Economic GAAP Economic
Three Months Ended Basis
Basis(2)
Basis
Basis(4)

Consolidated
June 30, 2015 $ 976 $ 967 3.47 % 3.44 %
March 31, 2015 1,107 1,106 3.77 % 3.77 %
December 31, 2014 11,955 11,810 3.25 % 3.21 %
September 30, 2014 9,149 9,125 3.30 % 3.29 %
June 30, 2014 6,391 6,388 2.86 % 2.86 %
March 31, 2014 3,662 3,526 2.40 % 2.30 %
Bimini Capital Only
June 30, 2015 $ 976 $ 967 3.47 % 3.44 %
March 31, 2015 1,107 1,106 3.77 % 3.77 %
December 31, 2014 935 935 3.58 % 3.58 %
September 30, 2014 682 682 3.28 % 3.28 %
June 30, 2014 478 478 2.68 % 2.68 %
March 31, 2014 290 184 2.21 % 1.33 %

($ in thousands)
Net Portfolio Net Portfolio
Interest Income Interest Spread
GAAP Economic GAAP Economic
Six Months Ended Basis
Basis(2)
Basis
Basis(4)

Consolidated
June 30, 2015 $ 2,083 $ 2,073 3.63 % 3.61 %
June 30, 2014 10,053 9,914 2.67 % 2.63 %
Bimini Capital Only
June 30, 2015 $ 2,083 $ 2,073 3.63 % 3.61 %
June 30, 2014 768 662 2.48 % 2.11 %

($ in thousands)
	Net Portfolio				Net Portfolio
	Interest Income				Interest Spread
	GAAP		Economic		GAAP			Economic
Three Months Ended	Basis		Basis⁽²⁾		Basis			Basis⁽⁴⁾
Consolidated
June 30, 2016	$	851	$	791		3.06	%		2.82	%
March 31, 2016		690		645		2.82	%		2.62	%
December 31, 2015		915		884		3.50	%		3.37	%
September 30, 2015		889		869		3.05	%		2.98	%
June 30, 2015		976		967		3.47	%		3.44	%
March 31, 2015		1,107		1,106		3.77	%		3.77	%

($ in thousands)
	Net Portfolio				Net Portfolio
	Interest Income				Interest Spread
	GAAP		Economic		GAAP			Economic
Six Months Ended	Basis		Basis⁽²⁾		Basis			Basis⁽⁴⁾
Consolidated
June 30, 2016	$	1,541	$	1,436		2.95	%		2.73	%
June 30, 2015		2,083		2,073		3.63	%		3.61	%

(1)

Portfolio yields and costs of borrowings presented in the tables above and the tables on pages ~~37-40~~31-33 are calculated based on the average balances of the underlying investment portfolio/repurchase agreement balances and are annualized for the periods presented. Average balances for quarterly periods are calculated using two data points, the beginning and ending balances.

(2)	Economic interest expense and economic net interest income presented in the tables above and the tables on page 3932 include the effect of derivative instrument hedges for only the period presented.

(3)	Represents interest cost of our borrowings and the effect of derivative instrument hedges attributed to the period related to hedging activities divided by Average MBS Held.

(4)	Economic Net Interest Spread is calculated by subtracting Average Economic Cost of Funds from Yield on Average MBS.

~~-36-~~-30-

Interest Income and Average Earning Asset Yield

Interest income for the Company was $1.8 million for the six months ended June 30, 2016 and $2.3 million for the six months ended June 30, ~~2015~~2015. Average MBS holdings were $103.3 million and ~~$11.2~~$114.2 million for the six months ended June 30, ~~2014. Average MBS holdings were $114.2 million~~2016 and ~~$742.0 million for the six months ended June 30,~~ 2015, ~~and 2014,~~ respectively. The ~~$8.9~~$0.5 million decrease in interest income was due to combination of a ~~$627.8~~43 basis point decrease in yields and a $10.9 million decrease in average MBS holdings, combined with a 97 basis point increase in yields. The decrease in average MBS during the six months ended June 30, 2015 reflects the deconsolidation of Orchid’s assets as of December 31, 2014.holdings.

Interest income for the Company was $1.0 million for the three months ended June 30, 2016 and $1.1 million for the three months ended June 30, ~~2015~~2015. Average MBS holdings were $110.0 million and ~~$7.1~~$111.7 million for the three months ended June 30, ~~2014. Average MBS holdings were $111.7 million~~2016 and ~~$882.6 million for the three months ended June 30,~~ 2015, ~~and 2014,~~ respectively. The ~~$6.0~~$0.1 million decrease in interest income was due to ~~a $770.9 million decrease in average MBS holdings as a result of the deconsolidation of Orchid as of December 31, 2014, combined with a 62 basis point increase in yields.~~

Interest income for Bimini Capital was $2.3 million for the six months ended June 30, 2015 and $0.9 million for the six months ended June 30, 2014. Average MBS holdings were $114.2 million and $61.3 million for the six months ended June 30, 2015 and 2014, respectively. The $1.4 million increase in interest income was due to a combination of a ~~118~~12 basis point ~~increase~~decrease in yields and a ~~$52.9~~$1.7 million ~~increase~~decrease in average MBS holdings.

Interest income for Bimini Capital was $1.07 million for the three months ended June 30, 2015 and $0.53 million for the three months ended June 30, 2014. Average MBS holdings were $111.7 million and $70.7 million for the three months ended June 30, 2015 and 2014, respectively. The $0.54 million increase in interest income was due to a combination of a 85 basis point increase in yields and a $41.0 million increase in average MBS holdings.

The tables below present the consolidated average portfolio size, income and yields of our respective sub-portfolios, consisting of structured MBS and pass-through MBS (“("PT ~~MBS”~~MBS") for the six months ended June 30, ~~2015~~2016 and ~~2014~~2015 and for each quarter during ~~2015~~2016 and ~~2014.~~2015.

($ in thousands)
Average MBS Held Interest Income Realized Yield on Average MBS
PT Structured PT Structured PT Structured
Three Months Ended MBS MBS Total MBS MBS Total MBS MBS Total
Consolidated
June 30, 2015 $ 105,368 $ 6,306 $ 111,674 $ 1,031 $ 43 $ 1,074 3.91 % 2.75 % 3.85 %
March 31, 2015 111,035 5,674 116,709 1,090 117 1,207 3.93 % 8.25 % 4.14 %
December 31, 2014 1,397,518 68,530 1,466,048 13,719 (551 ) 13,168 3.93 % (3.21 )% 3.59 %
September 30, 2014 1,048,424 59,943 1,108,367 10,266 (231 ) 10,035 3.92 % (1.55 )% 3.62 %
June 30, 2014 833,497 49,094 882,591 8,303 (1,184 ) 7,119 3.98 % (9.64 )% 3.23 %
March 31, 2014 564,540 36,901 601,441 4,852 (736 ) 4,116 3.44 % (7.97 )% 2.74 %
Bimini Capital Only
June 30, 2015 $ 105,368 $ 6,306 $ 111,674 $ 1,031 $ 43 $ 1,074 3.91 % 2.75 % 3.85 %
March 31, 2015 111,035 5,674 116,709 1,090 117 1,207 3.93 % 8.25 % 4.14 %
December 31, 2014 98,552 5,144 103,696 957 65 1,022 3.89 % 5.01 % 3.94 %
September 30, 2014 79,390 3,209 82,599 784 (35 ) 749 3.95 % (4.36 )% 3.63 %
June 30, 2014 69,298 1,412 70,710 629 (99 ) 530 3.63 % (27.87 )% 3.00 %
March 31, 2014 50,315 1,636 51,951 450 (117 ) 333 3.58 % (28.49 )% 2.57 %

~~-37-~~

($ in thousands)
	Average MBS Held						Interest Income							Realized Yield on Average MBS
	PT		Structured				PT		Structured					PT			Structured
Three Months Ended	MBS		MBS		Total		MBS		MBS			Total		MBS			MBS			Total
Consolidated
June 30, 2016	$	106,653	$	3,364	$	110,017	$	1,008	$	17		$	1,025		3.78	%		2.05	%		3.73	%
March 31, 2016		92,365		4,227		96,592		783		34			817		3.39	%		3.25	%		3.39	%
December 31, 2015		98,585		4,966		103,551		1,057		(22	)		1,035		4.29	%		(1.82	)%		4.00	%
September 30, 2015		109,582		5,855		115,437		1,038		(42	)		996		3.79	%		(2.90	)%		3.45	%
June 30, 2015		105,368		6,306		111,674		1,031		43			1,074		3.91	%		2.75	%		3.85	%
March 31, 2015		111,035		5,674		116,709		1,090		117			1,207		3.93	%		8.25	%		4.14	%

($ in thousands)
	Average MBS Held						Interest Income							Realized Yield on Average MBS
	PT		Structured				PT		Structured					PT			Structured
Six Months Ended	MBS		MBS		Total		MBS		MBS			Total		MBS			MBS			Total
Consolidated
June 30, 2016	$	99,509	$	3,796	$	103,305	$	1,791	$	51		$	1,842		3.60	%		2.72	%		3.57	%
June 30, 2015		108,202		5,990		114,192		2,121		160			2,281		3.92	%		5.36	%		4.00	%

($ in thousands)
Average MBS Held Interest Income Realized Yield on Average MBS
PT Structured PT Structured PT Structured
Six Months Ended MBS MBS Total MBS MBS Total MBS MBS Total
Consolidated
June 30, 2015 $ 108,202 $ 5,990 $ 114,192 $ 2,121 $ 160 $ 2,281 3.92 % 5.36 % 4.00 %
June 30, 2014 699,018 42,998 742,016 13,155 (1,920 ) 11,235 3.76 % (8.93 )% 3.03 %
Bimini Capital Only
June 30, 2015 $ 108,202 $ 5,990 $ 114,192 $ 2,121 $ 160 $ 2,281 3.92 % 5.36 % 4.00 %
June 30, 2014 59,806 1,524 61,330 1,079 (216 ) 863 3.61 % (28.21 )% 2.82 %

Interest Expense on Repurchase Agreements and the Cost of Funds

Average outstanding repurchase agreements for the Company were ~~$105.9~~$96.6 million and ~~$658.2~~$105.9 million, generating interest expense of ~~$0.2~~$0.3 million and ~~$1.2~~$0.2 million for the six months ended June 30, ~~2015~~2016 and ~~2014,~~2015, respectively. Our average cost of funds was ~~0.37%~~0.62% and ~~0.36%~~0.37% for six months ended June 30, ~~2015~~2016 and ~~2014,~~2015, respectively. There was a 125 basis point increase in the average cost of funds and a ~~$552.2~~$9.3 million decrease in average outstanding repurchase agreements during the six months ended June 30, ~~2015~~2016 as compared to the six months ended June 30, ~~2014. The decrease in average outstanding repurchase agreements, and the corresponding decrease in interest expense, reflects the deconsolidation of Orchid as of December 31, 2014.~~2015.

The ~~Company’s~~Company's economic interest expense was ~~$0.2~~$0.4 million and ~~$1.3~~$0.2 million for the six months ended June 30, ~~2015~~2016 and ~~2014,~~2015, respectively. There was a 145 basis point ~~decrease~~increase in the average economic cost of funds to 0.84% for the six months ended June 30, 2016 from 0.39% for the six months ended June 30, ~~2015 from 0.40% for the six months ended June 30, 2014.~~2015. The $0.2 million increase in economic interest expense was ~~primarily~~ due to the increase in the economic cost of funds rate, partially offset by the $9.3 million decrease in average outstanding repurchase agreements during the six months ended June 30, ~~2015, partially offset by the decrease in the economic cost of funds rate.~~2016.

-31-

Average outstanding repurchase agreements for the Company were ~~$103.7~~$103.3 million and ~~$783.3~~$103.7 million, generating interest expense of ~~$0.1~~$0.2 million and ~~$0.7~~$0.1 million for the three months ended June 30, ~~2015~~2016 and ~~2014,~~2015, respectively. Our average cost of funds was ~~0.38%~~0.67% and ~~0.37%~~0.38% for three months ended June 30, ~~2015~~2016 and ~~2014,~~2015, respectively. There was a 129 basis point increase in the average cost of funds and a ~~$679.6~~$0.5 million decrease in average outstanding repurchase agreements during the three months ended June 30, ~~2015~~2016 as compared to the three months ended June 30, ~~2014.~~2015.

The ~~Company’s~~Company's economic interest expense was ~~$0.1~~$0.2 million and ~~$0.7~~$0.1 million for the three months ended June 30, ~~2015~~2016 and ~~2014,~~2015, respectively. There was a 450 basis point increase in the average economic cost of funds to 0.91% for the three months ended June 30, 2016 from 0.41% for the three months ended June 30, ~~2015 from 0.37% for the three months ended June 30, 2014.~~2015. The $0.1 million increase in economic interest expense was ~~primarily~~ due to the increase in the economic cost of funds rate, partially offset by the $0.5 million decrease in average outstanding repurchase agreements during the three months ended June 30, ~~2015, partially offset by the decrease in the economic cost of funds rate.~~

Average outstanding repurchase agreements for Bimini Capital were $105.9 million and total interest expense was $0.2 million for the six months ended June 30, 2015. During the six months ended June 30, 2014, average outstanding repurchase agreements for Bimini Capital were $57.0 million and total interest expense was $0.1 million. Bimini Capital’s average cost of funds was 0.37% and 0.34% for the six months ended June 30, 2015 and 2014, respectively.

Bimini Capital’s economic interest expense was $0.2 million for each of the six months ended June 30, 2015 and 2014. There was a 32 basis point decrease in the average economic cost of funds to 0.39% for the six months ended June 30, 2015 from 0.71% for the six months ended June 30, 2014.

~~-38-~~

Average outstanding repurchase agreements for Bimini Capital were $103.7 million and total interest expense was $0.10 million for the three months ended June 30, 2015. During the three months ended June 30, 2014, average outstanding repurchase agreements for Bimini Capital were $65.8 million and total interest expense was $0.05 million. Bimini Capital’s average cost of funds was 0.38% and 0.32% for the three months ended June 30, 2015 and 2014, respectively.

Bimini Capital’s economic interest expense was $0.11 million and $0.05 million for the three months ended June 30, 2015 and 2014, respectively. There was a 9 basis point increase in the average economic cost of funds to 0.41% for the three months ended June 30, 2015 from 0.32% for the three months ended June 30, 2014.2016.

Because all of our repurchase agreements are short-term, changes in market rates directly affect our interest expense. The ~~Company’s~~Company's average cost of funds calculated on a GAAP basis was 2023 basis points above the average one-month LIBOR and 225 basis points below the average six-month LIBOR for the quarter ended June 30, ~~2015.~~2016. The ~~Company’s~~Company's average economic cost of funds was 2347 basis points above the average one-month LIBOR and 1 basis ~~point above~~points below the average six-month LIBOR for the quarter ended June 30, ~~2015.~~2016. The average term to maturity of the outstanding repurchase agreements increased from 1417 days at December 31, ~~2014~~2015 to 2029 days at June 30, ~~2015.~~2016.

The tables below present the consolidated average outstanding balances under our repurchase agreements, interest expense and average economic cost of funds, and average one-month and six-month LIBOR rates for the six months ended June 30, ~~2015~~2016 and ~~2014~~2015 and each quarter in ~~2015~~2016 and ~~2014~~2015 on both a GAAP and economic basis.

($ in thousands)
	Average
	Balance of		Interest Expense				Average Cost of Funds
	Repurchase		GAAP		Economic		GAAP			Economic
Three Months Ended	Agreements		Basis		Basis		Basis			Basis
Consolidated
June 30, 2016	$	103,259	$	174	$	234		0.67	%		0.91	%
March 31, 2016		90,014		127		172		0.57	%		0.77	%
December 31, 2015		95,456		120		151		0.50	%		0.63	%
September 30, 2015		107,442		107		127		0.40	%		0.47	%
June 30, 2015		103,750		98		107		0.38	%		0.41	%
March 31, 2015		108,129		100		101		0.37	%		0.37	%

($ in thousands)
	Average
	Balance of		Interest Expense				Average Cost of Funds
	Repurchase		GAAP		Economic		GAAP			Economic
Six Months Ended	Agreements		Basis		Basis		Basis			Basis
Consolidated
June 30, 2016	$	96,637	$	301	$	406		0.62	%		0.84	%
June 30, 2015		105,939		198		208		0.37	%		0.39	%

($ in thousands)
Average
Balance of Interest Expense Average Cost of Funds
Repurchase GAAP Economic GAAP Economic
Three Months Ended Agreements Basis Basis Basis Basis
Consolidated
June 30, 2015 $ 103,750 $ 98 $ 107 0.38 % 0.41 %
March 31, 2015 108,129 100 101 0.37 % 0.37 %
December 31, 2014 1,442,905 1,213 1,358 0.34 % 0.38 %
September 30, 2014 1,096,611 886 910 0.32 % 0.33 %
June 30, 2014 783,323 728 731 0.37 % 0.37 %
March 31, 2014 533,008 454 590 0.34 % 0.44 %
Bimini Capital Only
June 30, 2015 $ 103,750 $ 98 $ 107 0.38 % 0.41 %
March 31, 2015 108,129 100 101 0.37 % 0.37 %
December 31, 2014 96,591 87 86 0.36 % 0.36 %
September 30, 2014 76,772 67 67 0.35 % 0.35 %
June 30, 2014 65,849 53 53 0.32 % 0.32 %
March 31, 2014 48,106 43 149 0.36 % 1.24 %

($ in thousands)
Average
Balance of Interest Expense Average Cost of Funds
Repurchase GAAP Economic GAAP Economic
Six Months Ended Agreements Basis Basis Basis Basis
Consolidated
June 30, 2015 $ 105,939 $ 198 $ 208 0.37 % 0.39 %
June 30, 2014 658,165 1,182 1,321 0.36 % 0.40 %
Bimini Capital Only
June 30, 2015 $ 105,939 $ 198 $ 208 0.37 % 0.39 %
June 30, 2014 56,978 96 202 0.34 % 0.71 %

~~-39-~~-32-

Average GAAP Cost of Funds Average Economic Cost of Funds
Relative to Average Relative to Average
Average LIBOR One-Month Six-Month One-Month Six-Month
Three Months Ended One-Month Six-Month LIBOR LIBOR LIBOR LIBOR
Consolidated
June 30, 2015 0.18 % 0.40 % 0.20 % (0.02 )% 0.23 % 0.01 %
March 31, 2015 0.17 % 0.35 % 0.20 % 0.02 % 0.20 % 0.02 %
December 31, 2014 0.16 % 0.34 % 0.18 % 0.00 % 0.22 % 0.04 %
September 30, 2014 0.15 % 0.33 % 0.17 % (0.01 )% 0.18 % 0.00 %
June 30, 2014 0.15 % 0.33 % 0.22 % 0.04 % 0.22 % 0.04 %
March 31, 2014 0.16 % 0.34 % 0.18 % 0.00 % 0.28 % 0.10 %
Bimini Capital Only
June 30, 2015 0.18 % 0.40 % 0.20 % (0.02 )% 0.23 % 0.01 %
March 31, 2015 0.17 % 0.35 % 0.20 % 0.02 % 0.20 % 0.02 %
December 31, 2014 0.16 % 0.34 % 0.20 % 0.02 % 0.20 % 0.02 %
September 30, 2014 0.15 % 0.33 % 0.20 % 0.02 % 0.20 % 0.02 %
June 30, 2014 0.15 % 0.33 % 0.17 % (0.01 )% 0.17 % (0.01 )%
March 31, 2014 0.16 % 0.34 % 0.20 % 0.02 % 1.08 % 0.90 %

Average GAAP Cost of Funds Average Economic Cost of Funds
Relative to Average Relative to Average
Average LIBOR One-Month Six-Month One-Month Six-Month
Six Months Ended One-Month Six-Month LIBOR LIBOR LIBOR LIBOR
Consolidated
June 30, 2015 0.18 % 0.38 % 0.19 % (0.01 )% 0.21 % 0.01 %
June 30, 2014 0.16 % 0.33 % 0.20 % 0.03 % 0.24 % 0.07 %
Bimini Capital Only
June 30, 2015 0.18 % 0.38 % 0.19 % (0.01 )% 0.21 % 0.01 %
June 30, 2014 0.16 % 0.33 % 0.18 % 0.01 % 0.55 % 0.38 %

							Average GAAP Cost of Funds						Average Economic Cost of Funds
							Relative to Average						Relative to Average
	Average LIBOR						One-Month			Six-Month			One-Month			Six-Month
Three Months Ended	One-Month			Six-Month			LIBOR			LIBOR			LIBOR			LIBOR
Consolidated
June 30, 2016		0.44	%		0.92	%		0.23	%		(0.25	)%		0.47	%		(0.01	)%
March 31, 2016		0.40	%		0.84	%		0.17	%		(0.27	)%		0.37	%		(0.07	)%
December 31, 2015		0.28	%		0.65	%		0.22	%		(0.15	)%		0.35	%		(0.02	)%
September 30, 2015		0.19	%		0.49	%		0.21	%		(0.09	)%		0.28	%		(0.02	)%
June 30, 2015		0.18	%		0.40	%		0.20	%		(0.02	)%		0.23	%		0.01	%
March 31, 2015		0.17	%		0.35	%		0.20	%		0.02	%		0.20	%		0.02	%


							Average GAAP Cost of Funds						Average Economic Cost of Funds
							Relative to Average						Relative to Average
	Average LIBOR						One-Month			Six-Month			One-Month			Six-Month
Six Months Ended	One-Month			Six-Month			LIBOR			LIBOR			LIBOR			LIBOR
Consolidated
June 30, 2016		0.42	%		0.88	%		0.20	%		(0.26	)%		0.42	%		(0.04	)%
June 30, 2015		0.18	%		0.38	%		0.19	%		(0.01	)%		0.21	%		0.01	%

Junior Subordinated Notes

Interest expense on the ~~Company’s~~Company's junior subordinated debt securities was $0.5 million for each of the six months ended June 30, ~~2015~~2016 and ~~2014.~~2015. The average rate of interest paid for the six months ended June 30, ~~2015~~2016 was ~~3.76%~~4.11% compared to ~~3.74%~~3.76% for the comparable period in ~~2014.~~2015.

Interest expense on the ~~Company’s~~Company's junior subordinated debt securities was $0.3 million and $0.2 million for ~~each of~~ the three month periods ended June 30, 2016 and 2015, ~~and 2014.~~respectively. The average rate of interest paid for the three months ended June 30, ~~2015~~2016 was ~~3.77%~~4.20% compared to ~~3.73%~~3.77% for the comparable period in ~~2014.~~2015.

The junior subordinated debt securities pay interest at a floating rate. The rate is adjusted quarterly and set at a spread of 3.50% over the prevailing three-month LIBOR rate on the determination date. As of June 30, ~~2015,~~2016, the interest rate was ~~3.79%~~4.15%.

~~-40-~~

Gains or Losses and Other Income

The table below presents the ~~Company’s~~Company's gains or losses and other income for the six and three months ended June 30, ~~2015~~2016 and ~~2014.~~2015.

(in thousands)
	Six Months Ended June 30,									Three Months Ended June 30,
	2016			2015			Change			2016				2015			Change
Realized gains on sales of MBS	$	251		$	-		$	251		$	19			$	-		$	19
Unrealized (losses) gains on MBS		(39	)		(197	)		158			249				(1,027	)		1,276
Total gains (losses) on MBS		212			(197	)		409			268		-		(1,027	)		1,295
(Losses) gains on derivative instruments		(2,057	)		(1,009	)		(1,048	)		(758	)			6			(764	)
Advisory services		2,543			2,382			161			1,274				1,287			(13	)
Gains on retained interests		1,080			2,539			(1,459	)		534				1,053			(519	)
Unrealized gains (losses) on Orchid Island Capital, Inc.		502			(1,806	)		2,308			(112	)			(1,993	)		1,881
Orchid Island Capital, Inc. dividends		1,172			1,060			112			586				530			56

(in thousands)
Six Months Ended June 30, Three Months Ended June 30,
2015 2014 Change 2015 2014 Change
Realized gains on sales of MBS $ - $ 4,049 $ (4,049 ) $ - $ 2,980 $ (2,980 )
Unrealized (losses) gains on MBS (197 ) 11,266 (11,463 ) (1,027 ) 9,698 (10,725 )
Total (losses) gains on MBS (197 ) 15,315 (15,512 ) (1,027 ) 12,678 (13,705 )
(Losses) gains on Eurodollar futures (1,009 ) (6,306 ) 5,297 6 (4,745 ) 4,751
Gains on retained interests 2,539 2,447 92 1,053 2,253 (1,200 )
Loss on payer swaption - (1,285 ) 1,285 - (1,129 ) 1,129
Unrealized losses on Orchid Island Capital, Inc. (1,806 ) - (1,806 ) (1,993 ) - (1,993 )
Orchid Island Capital, Inc. dividends 1,060 - 1,060 530 - 530
Mangement fees 1,869 - 1,869 1,014 - 1,014

-33-

We invest in MBS with the intent to earn net income from the realized yield on those assets over the related funding and hedging costs, and not for purposes of making short term gains from trading in these securities. However, we have sold, and may continue to sell, existing assets to acquire new assets, which our management believes might have higher risk-adjusted returns in light of current or anticipated interest rates, federal government programs or general economic conditions or to manage our balance sheet as part of our asset/liability management strategy. During the six and three months ended June 30, 2016, the Company received proceeds of $41.8 million and $16.0 million from the sales of MBS, respectively. During the six months ended June 30, 2015, the Company did not dispose of any MBS. ~~For the six and three months ended June 30, 2014, the Company received proceeds of $434.6 million and $279.5 million, respectively, from the sales of MBS.~~

~~The higher MBS trading activities in the six and three months ended June 30, 2014 reflects the repositioning of our portfolio following Orchid’s capital raising activities.~~ The fair value ~~adjustments~~of the Company's MBS portfolio and derivative instruments, and the gains (losses) reported on ~~MBS for the six months ended June 30, 2015 and 2014 were the result of~~those financial instruments, are sensitive to changes in ~~market conditions. Losses on Eurodollar futures contracts reflect the declining LIBOR during the six months ended June 30, 2015 and 2014.~~interest rates. The table below presents historical interest rate data for each quarter end during ~~2015~~2016 and ~~2014.~~2015.

15 Year 30 Year Three
10 Year Fixed-Rate Fixed-Rate Month
Three Months Ended
Treasury Rate(1)

Mortgage Rate(2)

Mortgage Rate(2)

Libor(3)

June 30, 2015 2.34 % 3.19 % 3.98 % 0.28 %
March 31, 2015 1.93 % 3.04 % 3.77 % 0.27 %
December 31, 2014 2.17 % 3.13 % 3.86 % 0.25 %
September 30, 2014 2.51 % 3.31 % 4.16 % 0.23 %
June 30, 2014 2.52 % 3.27 % 4.16 % 0.23 %
March 31, 2014 2.72 % 3.36 % 4.34 % 0.23 %

							15 Year			30 Year			Three
	5 Year			10 Year			Fixed-Rate			Fixed-Rate			Month
	Treasury Rate⁽¹⁾			Treasury Rate⁽¹⁾			Mortgage Rate⁽²⁾			Mortgage Rate⁽²⁾			Libor⁽³⁾
June 30, 2016		1.01	%		1.49	%		2.84	%		3.57	%		0.65	%
March 31, 2016		1.22	%		1.79	%		2.97	%		3.69	%		0.63	%
December 31, 2015		1.76	%		2.27	%		3.21	%		3.96	%		0.54	%
September 30, 2015		1.38	%		2.06	%		3.10	%		3.89	%		0.33	%
June 30, 2015		1.63	%		2.34	%		3.19	%		3.98	%		0.28	%
March 31, 2015		1.38	%		1.93	%		3.04	%		3.77	%		0.27	%

(1)	Historical 10 Year Treasury Rates are obtained from quoted end of day prices on the Chicago Board Options Exchange.

(2)	Historical 30 Year and 15 Year Fixed Rate Mortgage Rates are obtained from Freddie ~~Mac’s~~Mac's Primary Mortgage Market Survey.

~~(3)~~ 3)

Historical LIBOR are obtained from the Intercontinental Exchange Benchmark Administration Ltd.

The retained interests in securitizations represent the residual net interest spread remaining after payments on the notes issued through the securitization. Fluctuations in value of retained interests are primarily driven by projections of future interest rates (the forward LIBOR curve), the discount rate used to determine the present value of the residual cash flows and prepayment and loss estimates on the underlying mortgage loans. During the six and three months ended June 30, ~~2015,~~2016, the Company recorded gains on retained interests of ~~$2.5~~$1.1 million and ~~$1.1~~$0.5 million, respectively, compared to gains of ~~$2.4~~$2.5 million and ~~$2.3~~$1.1 million, respectively, for the six and three months ended June 30, ~~2014.~~2015.

Advisory Services

Advisory services revenue consist of management fees and overhead reimbursements charged to Orchid for the management of its portfolio pursuant to the terms of a management agreement.

~~-41-~~-34-

Operating Expenses

For the six and three months ended June 30, ~~2015,~~2016, the ~~Company’s~~Company's total operating expenses were approximately ~~$6.3~~$2.7 million and ~~$1.5~~$1.4 million, respectively, compared to approximately ~~$3.6~~$6.8 million and ~~$2.3~~$1.8 million for the six and three months ended June 30, ~~2014,~~2015, respectively. The table below presents a breakdown of operating expenses for the six and three months ended June 30, ~~2015~~2016 and ~~2014.~~2015.

(in thousands)
	Six Months Ended June 30,							Three Months Ended June 30,							Six Months Ended June 30,							Three Months Ended June 30,
	2015		2014		Change			2015		2014		Change			2016		2015		Change			2016		2015		Change
Compensation and benefits	$	1,263	$	1,357	$	(94	)	$	595	$	911	$	(316	)	$	1,551	$	1,522	$	29		$	755	$	738	$	17
Legal fees		713		624		89			536		445		91			104		712		(608	)		40		536		(496	)
Accounting, auditing and other professional fees		335		465		(130	)		177		244		(67	)		191		335		(144	)		98		177		(79	)
Directors’ fees and liability insurance		343		544		(201	)		175		303		(128	)
Direct REIT operating expenses		37		229		(192	)		18		114		(96	)
Directors' fees and liability insurance																311		343		(32	)		156		175		(19	)
Settlement of litigation		3,500		-		3,500			-		-		-			-		3,500		(3,500	)		-		-		-
Other G&A expenses		118		391		(273	)		33		236		(203	)		567		433		134			305		192		113
	$	6,309	$	3,610	$	2,699		$	1,534	$	2,253	$	(719	)	$	2,724	$	6,845	$	(4,121	)	$	1,354	$	1,818	$	(464	)

($ in thousands)
June 30, 2015 December 31, 2014
Percentage of Percentage of
Agency Fair Value Entire Portfolio Fair Value Entire Portfolio
Fannie Mae $ 60,122 55.8 % $ 66,974 56.8 %
Freddie Mac 46,356 43.0 % 50,415 42.8 %
Ginnie Mae 1,283 1.2 % 442 0.4 %
Total Portfolio $ 107,761 100.0 % $ 117,831 100.0 %

($ in thousands)
2015 2014
Total Cost Average Price Weighted Average Yield Total Cost Average Price Weighted Average Yield
PT MBS $ - $ - 0.00 % $ 978,252 $ 107.50 3.07 %
Structured MBS 986 8.18 10.23 % 32,155 14.65 (5.02 )%

($ in thousands)
	Six Months Ended June 30,
	2016								2015
		Total Cost		Average Price		Weighted Average Yield				Total Cost		Average Price		Weighted Average Yield
PT MBS		$	74,460	$	110.75		2.50	%		$	-	$	-		-
Structured MBS			-		-		-				986		8.18		10.23	%

The ~~Company’s~~Company's portfolio of PT MBS is typically comprised of adjustable-rate MBS, fixed-rate MBS and hybrid adjustable-rate MBS. The Company generally seeks to acquire low duration assets that offer high levels of protection from mortgage prepayments provided they are reasonably priced by the market. Although the duration of an individual asset can change as a result of changes in interest rates, the Company strives to maintain a hedged PT MBS portfolio with an effective duration of less than 2.0. The stated contractual final maturity of the mortgage loans underlying the ~~Company’s~~Company's portfolio of PT MBS generally ranges up to 30 years. However, the effect of prepayments of the underlying mortgage loans tends to shorten the resulting cash flows from the ~~Company’s~~Company's investments substantially. Prepayments occur for various reasons, including refinancing of underlying mortgages and loan payoffs in connection with home sales.

The duration of the ~~Company’s~~Company's IO and IIO portfolio will vary greatly depending on the structural features of the securities. While prepayment activity will always affect the cash flows associated with the securities, the interest only nature of ~~IO’s~~IO's may cause their durations to become extremely negative when prepayments are high, and less negative when prepayments are low. Prepayments affect the durations of ~~IIO’s~~IIO's similarly, but the floating rate nature of the coupon of IIOs (which is inversely related to the level of one month LIBOR) cause their price movements - and model duration - to be affected by changes in both prepayments and one month LIBOR - both current and anticipated levels. As a result, the duration of IIO securities will also vary greatly.

Prepayments on the loans underlying the ~~Company’s~~Company's MBS can alter the timing of the cash flows from the underlying loans to the Company. As a result, the Company gauges the interest rate sensitivity of its assets by measuring their effective duration. While modified duration measures the price sensitivity of a bond to movements in interest rates, effective duration captures both the movement in interest rates and the fact that cash flows to a mortgage related security are altered when interest rates move. Accordingly, when the contract interest rate on a mortgage loan is substantially above prevailing interest rates in the market, the effective duration of securities collateralized by such loans can be quite low because of expected prepayments.

The Company faces the risk that the market value of its PT MBS assets will increase or decrease at different rates than that of its structured MBS or liabilities, including its hedging instruments. Accordingly, the Company assesses its interest rate risk by estimating the duration of its assets and the duration of its liabilities. The Company generally calculates duration and effective duration using various third-party models or obtains these quotes from third parties. However, empirical results and various third-party models may produce different duration numbers for the same securities.

~~-44-~~-37-

The following sensitivity analysis shows the estimated impact on the fair value of our interest rate-sensitive investments and hedge positions as of June 30, ~~2015,~~2016, assuming rates instantaneously fall 100 basis points ~~(“bps”~~("bps"), rise 100 bps and rise 200 bps, adjusted to reflect the impact of convexity, which is the measure of the sensitivity of our hedge positions and Agency ~~MBS’~~MBS' effective duration to movements in interest rates.

($ in thousands)
	Fair		$ Change in Fair Value									% Change in Fair Value									Fair		$ Change in Fair Value									% Change in Fair Value
MBS Portfolio	Value		-100BPS			+100BPS			+200BPS			-100BPS			+100BPS			+200BPS			Value		-100BPS			+100BPS			+200BPS			-100BPS			+100BPS			+200BPS
Hybrid Adjustable Rate MBS	$	121	$	2		$	(2	)	$	(5	)		1.25	%		(1.69	)%		(3.78	)%	$	115	$	2		$	(2	)	$	(3	)		1.37	%		(1.58	)%		(2.58	)%
Fixed Rate MBS		101,160		2,992			(4,989	)		(10,776	)		2.96	%		(4.93	)%		(10.65	)%		107,751		2,097			(4,712	)		(10,697	)		1.95	%		(4.37	)%		(9.93	)%
Interest-Only MBS		3,345		(1,552	)		1,042			1,592			(46.40	)%		31.14	%		47.59	%		1,299		(545	)		590			930			(41.94	)%		45.43	%		71.61	%
Inverse Interest-Only MBS		3,135		(289	)		(208	)		(724	)		(9.23	)%		(6.64	)%		(23.10	)%		1,673		(237	)		22			(152	)		(14.18	)%		1.29	%		(9.07	)%
Total MBS Portfolio	$	107,761	$	1,153		$	(4,157	)	$	(9,913	)		1.07	%		(3.86	)%		(9.20	)%	$	110,838	$	1,317		$	(4,102	)	$	(9,922	)		1.19	%		(3.70	)%		(8.95	)%

($ in thousands)
	Notional		$ Change in Fair Value									% Change in Fair Value									Notional		$ Change in Fair Value									% Change in Fair Value
	Amount(1)		-100BPS			+100BPS			+200BPS			-100BPS			+100BPS			+200BPS			Amount⁽¹⁾		-100BPS			+100BPS			+200BPS			-100BPS			+100BPS			+200BPS
Eurodollar Futures Contracts
Repurchase Agreement Hedges	$	646,000	$	(1,294	)	$	1,615		$	3,230			(0.81	)%		1.01	%		2.03	%	$	628,000	$	(322	)	$	1,570		$	3,140			(0.21	)%		1.01	%		2.02	%
Junior Subordinated Debt Hedges		312,000		(603	)		780			1,560			(0.78	)%		1.01	%		2.03	%		572,000		(667	)		1,430			2,860			(0.47	)%		1.01	%		2.02	%
	$	958,000	$	(1,897	)	$	2,395		$	4,790			(0.80	)%		1.01	%		2.03	%	$	1,200,000	$	(989	)	$	3,000		$	6,000			(0.33	)%		1.01	%		2.02	%

Gross Totals			$	(744	)	$	(1,762	)	$	(5,123	)												$	328		$	(1,102	)	$	(3,922	)

(1)	Represents the total cumulative contract/notional amount of Eurodollar futures contracts.

In addition to changes in interest rates, other factors impact the fair value of the ~~Company’s~~Company's interest rate-sensitive investments and hedging instruments, such as the shape of the yield curve, market expectations as to future interest rate changes and other market conditions. Accordingly, in the event of changes in actual interest rates, the change in the fair value of the ~~Company’s~~Company's assets would likely differ from that shown above and such difference might be material and adverse to the ~~Company’s~~Company's stockholders.

Repurchase Agreements

As of June 30, ~~2015,~~2016, the Company had established borrowing facilities in the repurchase agreement market with a number of commercial banks and other financial institutions and had borrowings in place with ~~five~~three of these counterparties. We believe these facilities provide borrowing capacity in excess of our needs. None of these lenders are affiliated with the Company. These borrowings are secured by the ~~Company’s~~Company's MBS and cash and bear interest rates that are based on a spread to LIBOR.

As of June 30, ~~2015,~~2016, the Company had obligations outstanding under the repurchase agreements of approximately ~~$101.2~~$103.7 million with a net weighted average borrowing cost of ~~0.39%~~0.69%. The remaining maturity of the ~~Company’s~~Company's outstanding repurchase agreement obligations ranged from 611 to 7677 days, with a weighted average maturity of 2029 days. Securing the repurchase agreement obligation as of June 30, ~~2015~~2016 are MBS with an estimated fair value, including accrued interest and receivable for securities sold, of ~~$106.2~~$109.7 million and a weighted average maturity of ~~320 months and cash pledged to counterparties of approximately $2.1 million.~~334 months. Through August ~~5, 2015,~~10, 2016, the Company has been able to maintain its repurchase facilities with comparable terms to those that existed at June 30, ~~2015~~2016 with maturities through October ~~6, 2015.~~25, 2016.

~~-45-~~-38-

The table below presents information about our period-end and average repurchase agreement obligations for each quarter in ~~2015~~2016 and ~~2014.~~2015.

($ in thousands)	($ in thousands)											($ in thousands)
						Difference Between Ending											Difference Between Ending
		Ending Balance		Average Balance		Repurchase Agreements and							Ending Balance		Average Balance		Repurchase Agreements and
		of Repurchase		of Repurchase		Average Repurchase Agreements							of Repurchase		of Repurchase		Average Repurchase Agreements
Three Months Ended		Agreements		Agreements		Amount			Percent				Agreements		Agreements		Amount			Percent
June 30, 2016													$	103,725	$	103,259	$	466			0.45	%
March 31, 2016														102,794		90,014		12,780			14.20	%⁽¹⁾
December 31, 2015														77,234		95,456		(18,222	)		(19.09	)%⁽²⁾
September 30, 2015														113,677		107,442		6,235			5.80	%
June 30, 2015			101,206		103,750		(2,544	)		(2.45	)%			101,206		103,750		(2,544	)		(2.45	)%
March 31, 2015		$	106,294	$	108,129	$	(1,835	)		(1.70	)%			106,294		108,129		(1,835	)		(1.70	)%
December 31, 2014			109,964		1,442,905		(1,332,941	)		(92.38	)%(1)
September 30, 2014			1,339,196		1,096,611		242,585			22.12	%(2)
June 30, 2014			854,026		783,323		70,703			9.03	%
March 31, 2014			712,620		533,008		179,612			33.70	%(3)

(1)	The higher ending balance relative to the average balance during the quarter ended March 31, 2016 reflects the repositioning of the portfolio. During the quarter ended March 31, 2016, the Company's investment in PT MBS increased $26.2 million.

(2)	The lower ending balance relative to the average balance during the quarter ended December 31, ~~2014~~2015 reflects the ~~deconsolidation of Orchid at December 31, 2014.~~

~~(2)~~

~~The higher ending balance relative to the average balance during the quarter ended September 30, 2014 reflects deployment~~repositioning of the ~~proceeds, on a leveraged basis, of certain equity offerings by Orchid.~~portfolio. During the quarter ended ~~September 30, 2014,~~December 31, 2015, the ~~Company’s~~Company's investment in PT ~~RMBS increased $294.4 million.~~

~~(3)~~

The higher ending balance relative to the average balance during the quarter ended March 31, 2014 reflects the deployment of the proceeds, on a leveraged basis, of Orchid’s January and March 2014 equity offerings. During the quarter ended March 31, 2014, the Company’s investment in PT RMBS increased $402.5MBS decreased $38.6 million.

Liquidity and Capital Resources

Liquidity is our ability to turn non-cash assets into cash, purchase additional investments, repay principal and interest on borrowings, fund overhead, fulfill margin calls and pay dividends. Our principal immediate sources of liquidity include cash balances, unencumbered assets, the availability to borrow under repurchase agreements, and fees and dividends received from Orchid. Our borrowing capacity will vary over time as the market value of our interest earning assets varies. Our balance sheet also generates liquidity on an on-going basis through payments of principal and interest we receive on our MBS portfolio, and from cash flows received from the retained interests and the collection of servicing advances. Management believes that we currently have sufficient liquidity and capital resources available for (a) the acquisition of additional investments consistent with the size and nature of our existing MBS portfolio, (b) the repayments on borrowings, (c) the payment of overhead and operating expenses, and (d) the payment of other accrued obligations.

~~Because~~Our strategy for hedging our ~~PT MBS~~funding costs typically involves taking short positions in Eurodollar futures, T-Note futures, swaptions or other instruments. Since inception we have primarily used short positions in Eurodollar futures. When the market causes these short positions to decline in value we are required to meet margin calls with cash. This can reduce our liquidity position to the extent other securities in our portfolio ~~consists entirely of government and agency securities,~~move in price in such a way that we do not ~~anticipate having difficulty converting our assets~~receive enough cash through margin calls to ~~cash should our~~offset the Eurodollar related margin calls. If this were to occur in sufficient magnitude, the loss of liquidity ~~needs ever exceed our immediately available sources~~might force us to reduce the size of ~~cash. Our~~the levered portfolio, pledge additional structured ~~MBS portfolio also consists entirely of governmental agency~~ securities although they typically do not trade with comparable bid / ask spreads as PT MBS. However, we anticipate that we would be able to liquidate such securities readily, even in distressed markets, although we would likely do so at prices below where such securities could be sold in a more stable market. To enhance our liquidity even further, we may pledge a portion of our structured MBS as part of a repurchase agreement funding but retain the cash in lieu of acquiring additional assets. In this way, we can, at a modest cost, retain higher levels of cash on hand and decrease the likelihood we will have to sell assets in a distressed market in order to raise ~~cash.~~funds or risk operating the portfolio with less liquidity.

~~The Company’s~~Our master repurchase agreements have no stated expiration, but can be terminated at any time at ~~the Company’s~~our option or at the option of the counterparty. However, once a definitive repurchase agreement under a master repurchase agreement has been entered into, it generally may not be terminated by either party. A negotiated termination can occur, but may involve a fee to be paid by the party seeking to terminate the repurchase agreement transaction.

~~-46-~~

Under our repurchase agreement funding arrangements, we are required to post margin at the initiation of the borrowing. The margin posted represents the haircut, which is a percentage of the market value of the collateral pledged. To the extent the market value of the asset collateralizing the financing transaction declines, the market value of our posted margin will be insufficient and we will be required to post additional collateral. Conversely, if the market value of the asset pledged increases in value, we would be over collateralized and we would be entitled to have excess margin returned to us by the counterparty. Our lenders typically value our pledged securities daily to ensure the adequacy of our margin and make margin calls as needed, as do we. Typically, but not always, the parties agree to a minimum threshold amount for margin calls so as to avoid the need for nuisance margin calls on a daily basis.

-39-

As discussed above, the Company invests a portion of its capital in structured MBS. We do not ~~fund the purchase~~apply leverage to this portion of ~~these investments in the repurchase market but instead purchase them directly, thus reducing – but not eliminating - the Company’s reliance on access to repurchase agreement funding.~~our portfolio. The leverage inherent in the structured securities replaces the leverage obtained by acquiring PT securities and funding them in the repurchase market. This structured MBS strategy has been a core element of the ~~Company’s~~Company's overall investment strategy since 2008. However, we have and may continue to pledge a portion of our structured MBS in order to raise our cash levels, but generally will not pledge these securities in order to acquire additional assets.

In future periods we expect to continue to finance our activities through repurchase agreements. As of June 30, ~~2015,~~2016, the Company had cash and cash equivalents of ~~$7.0~~$3.9 million. We generated cash flows of ~~$13.2~~$7.8 million from principal and interest payments on our MBS portfolio and ~~$2.3~~$0.8 million from retained interests and had average repurchase agreements outstanding of ~~$105.9~~$96.6 million during the six months ended June 30, ~~2015.~~2016. In addition, during the six months ended June 30, ~~2015,~~2016, the Company received approximately ~~$2.3~~$2.6 million in management fees and expense reimbursements as manager of Orchid and approximately ~~$1.1~~$1.2 million in dividends from its investment in Orchid common shares.

In May 2015, Bimini Capital agreed to settle a legal ~~action as more fully described in Note 10 to the consolidated financial statements.~~action. A loss of $3.5 million has been charged to operations for the six months ended June 30, ~~2015.~~2015 related to this settlement. Although payments under the settlement agreement will reduce the ~~Company’s~~Company's liquidity, management believes that the Company will be able to generate sufficient cash from its operations to meet the remaining payment obligations as they come due.

The table below summarizes the effect that certain future contractual obligations existing as of June 30, 2016 will have on our liquidity and cash ~~flows from certain future contractual obligations as of June 30, 2015.~~flows.

(in thousands)
	Obligations Maturing										Obligations Maturing
	Within One Year		One to Three Years		Three to Five Years		More than Five Years		Total		Within One Year		One to Three Years		Three to Five Years		More than Five Years		Total
Repurchase agreements	$	101,206	$	-	$	-	$	-	$	101,206	$	103,725	$	-	$	-	$	-	$	103,725
Interest expense on repurchase agreements(1)		68		-		-		-		68		125		-		-		-		125
Junior subordinated notes(2)		-		-		-		26,000		26,000		-		-		-		26,000		26,000
Interest expense on junior subordinated notes(1)		1,044		1,996		1,999		15,437		20,476		1,143		2,189		2,192		15,838		21,362
Litigation settlement		2,500		500		500		-		3,500		250		500		250		-		1,000
Totals	$	104,818	$	2,496	$	2,499	$	41,437	$	151,250	$	105,243	$	2,689	$	2,442	$	41,838	$	152,212

(1)	Interest expense on repurchase agreements and junior subordinated notes are based on current interest rates as of June 30, ~~2015~~2016 and the remaining term of liabilities existing at that date.

(2)	The Company holds a common equity interest in Bimini Capital Trust II. The amount presented represents the net cash outlay of the Company.

~~-47-~~

Outlook

~~Bimini Capital~~

Prior to 2008, MortCo incurred significant losses in the operation of a mortgage loan origination business. Bimini Capital materially downsized its investment portfolio to raise cash to fund the MortCo operations, leaving Bimini Capital with a significantly smaller capital base. This smaller capital base made it difficult to generate sufficient net interest income to cover expenses. Since MortCo terminated its operations in 2007, Bimini Capital has taken several significant steps designed to increase its probability of generating profits going forward, including a re-structuring of the portfolio, reducing expenses, retiring debt, and settling various litigation matters. In general, Bimini Capital still needed to increase its capital base, and/or create alternative sources of revenues, to ensure the generation of profits over the long-term. However, primarily because of litigation arising out of MortCo’s prior mortgage business, raising capital directly into Bimini Capital was not possible. Therefore, Orchid was formed as a new entity into which capital could be raised.

Orchid Island Capital Inc.

To the extent Orchid is able to increase its capital base over time, ~~Bimini Capital~~we will benefit via increased management fees. ~~Bimini Advisors will receive a monthly management fee in the amount of:~~

~~• One-twelfth~~In addition, Orchid is obligated to reimburse us for direct expenses paid on its behalf and to pay to us Orchid's pro rata share of ~~1.5% of the first $250 million of Orchid’s equity,~~overhead as defined in the management ~~agreement,~~

~~• One-twelfth of 1.25% of Orchid’s equity that is greater than $250 million and less than or equal to $500 million, and~~

~~• One-twelfth of 1.00% of Orchid’s equity that is greater than $500 million.~~

During the year ended December 31, 2014, Orchid completed additional offerings of its common stock. As of March 31, 2014, Orchid reached $100 million of stockholders equity for the first time. As a result, pursuant to the management agreement between Bimini Advisors and Orchid, commencing on July 1, 2014 Bimini Advisors began to allocate certain overhead costs to Orchid on a pro rata basis.agreement. As a stockholder of Orchid, ~~Bimini~~we will also continue to share in distributions, if any, paid by Orchid to its stockholders.

-40-

The independent Board of Directors of Orchid has the ability to terminate the management agreement and thus end ~~the~~our ability ~~of the Bimini Advisors and Bimini Capital~~ to collect management fees and share overhead costs. Should Orchid terminate the management agreement without cause, it ~~shall~~will pay ~~to Bimini Advisors~~us a termination fee equal to three times the average annual management fee, as defined in the management agreement, before or on the last day of the initial term or automatic renewal term.

Tax Matters

~~For~~Bimini Capital was taxed as a REIT under the ~~year ended~~Code until December 31, ~~2014,~~2014. Certain trends and events experienced during 2015 caused Bimini Capital ~~generated~~to no longer meet the Code's rules and regulations to be taxed as a REIT, ~~taxable loss. As more fully described~~effective January 1, 2015. In particular, additional offerings of common stock by Orchid in ~~footnote 11~~2015 increased revenue attributable to management fees received from Orchid by Bimini Advisors. In addition, payments that have been and will be made by Bimini Capital pursuant to a litigation settlement agreement entered into in 2015 reduced and may continue to reduce the value of Bimini Capital's assets and revenues generated by our MBS portfolio. Consequently, the aggregate value of our two TRSs (MortCo and Bimini Advisors) increased in relation to the ~~accompanying consolidated financial statements, REIT taxable income or loss generated by qualifying REIT activities is computed in accordance with~~value of Bimini Capital's assets to a level that exceeds the ~~Internal Revenue Code, which is different from~~limits permitted under the Company’s financial statement income or loss as computed in accordance with GAAP. Bimini Capital had REIT tax NOL carryforwards of approximately $17.3 million as of December 31, 2014 which are immediately available to offset future REIT taxable income.Code.

~~-48-~~

The ~~Company has used the term “REIT~~termination of our REIT status subjects Bimini Capital's taxable ~~income” throughout this document as being the amount available for distribution~~income to ~~its stockholders before any NOLs are applied,~~federal and ~~before any distributions. In arriving~~state corporate income taxes at income that could be subjected to taxation at the REIT entity level for a given year, dividends paid in the current year and any NOLs carried-over from prior periods are deducted (in that order) from current period income first. NOLs expire 20 years from the year they are incurred. Sinceregular corporate rates. However, Bimini Capital ~~currently has NOLs from prior periods, which begin~~and its subsidiaries have NOL carryforwards that, subject to ~~expire in 2028, and~~various expiration dates, are available to offset taxable income. Under our current ownership structure, the NOL carryforwards of each entity may generally be applied only to offset the taxable income of that entity. However, management is implementing certain internal restructuring transactions that would maximize our ability to utilize the existing federal NOL carryforwards.

In assessing the realizability of deferred tax assets, management considers whether it is more likely than not that some portion or all of the deferred tax assets will not be realized. The ultimate realization of capital loss and NOL carryforwards is dependent upon the generation of future capital gains and taxable income in ~~2015 and~~periods prior to their expiration. We currently provide a valuation allowance for a portion of the deferred tax assets. The valuation allowance relates primarily to the ability to utilize the NOL carryforwards of MortCo in future periods ~~Bimini Capital has~~and is based on management's estimated projections of future taxable income.

In addition, the ~~option, but not~~termination of our REIT status eliminated the ~~obligation,~~income, asset, distribution, and stock ownership requirements applicable to ~~apply such NOLs against REIT taxable income. As~~REITs, which provides us with more flexibility in executing our business strategy. Specifically, because we are no longer required to derive a ~~result, Bimini Capital could~~significant portion of our income from mortgage or other real estate related investments, we have ~~income~~greater flexibility to invest in ~~2015 and in future years, but not make distributions~~other types of assets as part of our principal investing activity, subject to ~~stockholders. This would occur if Bimini Capital had sufficient NOLs available~~maintaining compliance with our exclusion from regulation as an investment company under the Investment Company Act. In addition, because we no longer are subject to ~~entirely offset~~ the REIT ~~income earned in a given year and chose~~distribution requirement, we have greater flexibility to ~~apply such NOLs. Bimini Capital could also apply available NOLs against a portion of~~retain our earnings to fund future ~~period earnings and reduce the distributions to stockholders. Bimini Capital is unlikely to declare and pay dividends to stockholders until existing NOLs have been consumed.~~growth.

~~Interest Rates~~

-41-

~~Volatility in global interest rates continued in the~~Interest Rates

The second quarter of ~~2015. Interest rates rose across all sectors~~2016 was in many respects a continuation of market developments seen in the ~~global bond markets, thereby depressing bond prices across sectors. Spreads on U.S. Treasuries~~first quarter. At the conclusion of the same durations as Agency MBS incrementally widened during the second quarter, putting downward pressure on book value for many mortgage REITs. Both U.S. Treasuries and Agency MBS yields ended the second quarter higher than the close of the first quarter 2015. The rise in rates was led by growing sentiment that the European economies are recovering and the need for continued aggressive monetary stimulus by the European Central Bank (the "ECB") would diminish somewhat over the next few quarters. However, European markets decreased during the second quarter primarily due to fears stoked by uncertainty over Greek sovereign finances and its future as an ECB member and a member of the Eurozone.

We believe that the U.S. economy appears to be on a trajectory of slow, sustainable growth. The consensus forecast for 2015 economic growth in the U.S. remains at approximately 2.7%, accompanied by moderate growth in payrolls and inflation within the Federal Reserve's target range. The Federal Reserve continues to guide capital markets to anticipate the possibility of an interest rate hike in September or December 2015. Federal Reserve Chair Yellen, in her June 17, 2015 remarks following the June Federal Reserve Open Market Committee ~~("FOMC") policy~~ meeting ~~stated~~in late April, the committee released a statement that ~~she anticipates a long period of continued accommodative monetary policy following an initial rise~~was perceived to be dovish by the market. The committee was seen to be backing away from earlier calls for two to three rate increases in ~~the Federal Funds Rate later this year. These statements, which Chair Yellen reiterated in Congressional testimony on July 15~~2016 and ~~16, 2015, generally are in line~~more concerned with market ~~participants' expectations~~turmoil and events abroad. However, the market reaction was apparently stronger than the committee expected. The committee once again reversed their tone in May, and several governors and committee members returned to their data dependent focus in their public comments – appearing to try to talk the market back into expecting further policy normalization. This seemed to make sense as the incoming economic data improved and events overseas moderated. Just as the market was starting to price in a meaningful probability of a rate hike in June, the May non-farm payroll data was released in early June. The lone stalwart of the expansion, job growth, appeared to slow dramatically. The market was taken by surprise by the magnitude of the slowdown in job creation. Once again the market reversed course, and the futures market priced out most policy adjustments for the balance of ~~2015.~~the year. Later in the month the Federal Reserve conducted their scheduled meeting, and at the press conference Chair Yellen stressed the committee would be even more patient in normalizing rates and needed to see more data on the employment front to determine if the June report was the start of a new trend or an aberration. The chair also cited the pending referendum in the United Kingdom ("UK") the following week regarding the potential exit of the UK from the European Union ("EU"), referred to as "Brexit", as another reason for patience. The following week the market was stunned when voters in the UK voted in favor of the referendum and opted to leave the EU, albeit the process could take up to two years. The initial market reaction was violent, and the futures market priced in a small probability of an easing of monetary policy by the Fed in the months ahead. The second quarter ended with rates, particularly longer term rates, at or near all-time lows. In early July Germany issued 10 year bunds with a negative yield for the first time.

This made for a volatile market as expectations for the path of the economy, Federal Reserve monetary policy and the status of the EU changed violently and often over the course of the quarter. This has abated substantially in the third quarter. The impact on the mortgage market was to push spreads wider and heighten prepayment fears. As ofwe move further into the third quarter the market has improved. The economic data, starting with the June ~~30, 2015,~~non-farm payroll report on July 8th, and again on August 5, 2016 when the ~~bond market~~July report was issued, strengthened and the June report appears to have ~~priced~~been an aberration. The balance of the economic data since – at least data pertaining to the consumer and consumer spending - has been strong and the economy appears to be well on its way to recovering from a slowdown in anthe first quarter. Gross domestic product growth was less than 1% in the first quarter of 2016, and growth in the second quarter appears to have been slightly over 1%, based on the advanced reading released on July 29th, 2016. Secondly, the fall-out from the "Brexit" as it was dubbed appears to have been minimal. Since the event in late June, the European Central Bank has held a meeting and opted to maintain their current monetary policy as they wait to further assess the impact, if any, from the referendum. The Bank of England announced significant steps recently, involving both a reduction in rates as well as a substantial increase in asset purchases by the ~~federal funds rate~~central bank. The markets have reacted accordingly as equities, both domestically and in ~~September 2015~~Europe, have returned to levels seen before the vote, and in some cases higher. Interest rates have moved off the extreme lows seen immediately after the vote but have yet to reach pre-Brexit levels, as is the case with the British Pound. Mortgages have tightened, although still trade at slightly wider levels than those seen before the vote. Importantly for most mortgage investors, primary mortgage rates did not react meaningfully to the sharp rally in rates as originators appear to be unable or unwilling to lower rates available to borrowers as much as the move in benchmark rates would suggest. Given the turn in economic data the front end of the curve, and funding levels, have stabilized and are in fact higher than before the UK referendum. This has likely kept originators from lowering primary rates as their margins would just be squeezed further if they lowered rates to borrowers.

-42-

When and if the Fed does resume its tightening cycle and raises short term interest rates, a ~~slow rise over~~higher cost of capital for the ~~next few years. With the Federal Reserve ostensibly tying the start of interest rate increases to evidence of further improvement~~Company could, in the ~~economy, data releases~~longer-term, lead to narrowing net interest margins and lower yields on existing Agency MBS. Home sales and new single-family home construction remain ~~materially influential events. We believe that data dependency~~relatively slow due, in part, to mortgage lending rules implemented under the Wall Street Reform and ~~analysis~~Consumer Protection Act ("Dodd-Frank") and bank conservatism in efforts to, among other things, prevent future MBS repurchase requests. These factors have created a shortage of mortgage origination, resulting in low Agency MBS issuance. The Fed's purchases of Agency MBS through reinvesting principal and interest payments it receives on its existing Agency MBS portfolio have continued to dominate the ~~Federal Reserve~~Agency MBS markets, where many participants perceive a lack of liquidity. The Fed's purchases have contributed to strong Agency MBS demand and limited new investment opportunities. While the Fed has not indicated when it will ~~continue~~cease or reduce its Agency MBS purchases by reinvesting principal and interest payments, private banks have less incentive to ~~drive the direction and volatility of U.S. rates, with the uncertainty that this dynamic creates further volatility in the interest rate and fixed income markets.~~

~~Recent Regulatory Developments~~

In March 2015, housing and mortgage financial reform legislation, H.R. 1491, was proposed by congressmen John Delaney (D-MD), John Camey (D-DE) and James A. Himes (D-CT), each of whom is a member of the House Financial Services Committee. The bill is called The Partnership to Strengthen Homeownership Act, and is similar to a bill introduced by the same congressmen in the last Congress (H.R. 5055), which never made it out of committee. Under this proposed legislation, all government guaranteed single-family and multi-family mortgage backed securities will be supported by a minimum of 5% private sector capital, which will stand in a first loss position. The remaining 95% of the risk will be shared between Ginnie Mae and a private reinsurer on a pari passu basis. Fees paid to Ginnie Mae for providing these securities will be allocated to affordable housing programs. Under the bill,purchase Freddie Mac and Fannie Mae ~~would be wound down~~MBS, as the Basel III liquidity coverage ratio rules provide lower quality liquid asset credit for such securities on their balance sheets than for cash, U.S. Treasuries and MBS issued by Ginnie Mae.

Our portfolio positioning is therefore unlikely to change materially over ~~a five-year period, and their multifamily businesses~~the course of the year. We will be spun out as separate entities. Ginnie Mae would be required to create and implement a workable multifamily guarantee that utilizes private sector pricing consistent with the single family model. The GSEs' current multifamily businesses would continue to ~~function within~~closely monitor the ~~new multifamily housing~~developments in the market and may seek to re-align our strategy as ~~purely private organizations with an explicit government guarantee provided by Ginnie Mae~~we evaluate the opportunities across the spectrum in the mortgage industry and other types of assets in a ~~private sector reinsurer.~~

~~-49-~~

In May 2015, Senate Banking Committee Chairman Richard Shelby (R-AL) released a draft bill entitled The Regulatory Relief Bill of 2015 (the "Regulatory Relief Bill"). If enacted, this bill would increasecontinuing effort to seek the ~~threshold~~highest risk-adjusted returns for a financial institution to be deemed a Systemically Important Financial Institution ("SIFI") from $50 billion to $500 billion while giving the Financial Stability Oversight Council discretion to designate banks with greater than $50 billion in assets as SIFIs, give non-banks an opportunity to file a remedial plan addressing regulators' concerns before being designated as SIFIs, require an affirmative vote every five years to renew the SIFI designation of non-banks, provide regulatory relief for community banks and broaden the Consumer Financial Protection Bureau Qualified Mortgage rule.

We expect debate and discussion on residential housing and mortgage reform to continue in 2015. However, we cannot be certain if H.R. 1491, the Regulatory Relief Bill or any other housing- and/or mortgage-related bill will be approved by Congress, and if so, what the effect will be.our capital.

Effect on Us

Regulatory developments, movements in interest rates and prepayment rates as well as loan modification programs affect us in many ways, including the following:

Effects on our Assets

A change in or elimination of the guarantee structure of Agency MBS may increase our costs (if, for example, guarantee fees increase) or require us to change our investment strategy altogether. For example, the elimination of the guarantee structure of Agency MBS may cause us to change our investment strategy to focus on non-Agency MBS, which in turn would require us to significantly increase our monitoring of the credit risks of our investments in addition to interest rate and prepayment risks.

Lower long-term interest rates can affect the value of our Agency MBS in a number of ways. If prepayment rates are relatively low (due, in part, to the refinancing problems described above), lower long-term interest rates can increase the value of higher-coupon Agency MBS. This is because investors typically place a premium on assets with yields that are higher than market yields. Although lower long-term interest rates may increase asset values in our portfolio, we may not be able to invest new funds in similarly-yielding assets.

If prepayment levels increase, the value of our Agency MBS affected by such prepayments may decline. This is because a principal prepayment accelerates the effective term of an Agency MBS, which would shorten the period during which an investor would receive above-market returns (assuming the yield on the prepaid asset is higher than market yields). Also, prepayment proceeds may not be able to be reinvested in similar-yielding assets. Agency MBS backed by mortgages with high interest rates are more susceptible to prepayment risk because holders of those mortgages are most likely to refinance to a lower rate. IOs and IIOs, however, may be the types of Agency MBS most sensitive to increased prepayment rates. Because the holder of an IO or IIO receives no principal payments, the values of IOs and IIOs are entirely dependent on the existence of a principal balance on the underlying mortgages. If the principal balance is eliminated due to prepayment, IOs and IIOs essentially become worthless. Although increased prepayment rates can negatively affect the value of our IOs and IIOs, they have the opposite effect on POs. Because POs act like zero-coupon bonds, meaning they are purchased at a discount to their par value and have an effective interest rate based on the discount and the term of the underlying loan, an increase in prepayment rates would reduce the effective term of our POs and accelerate the yields earned on those assets, which would increase our net income.

-43-

Because we base our investment decisions on risk management principles rather than anticipated movements in interest rates, in a volatile interest rate environment we may allocate more capital to structured Agency MBS with shorter durations, such as short-term fixed and floating rate CMOs. We believe these securities have a lower sensitivity to changes in long-term interest rates than other asset classes. We may attempt to mitigate our exposure to changes in long-term interest rates by investing in IOs and IIOs, which typically have different sensitivities to changes in long-term interest rates than pass-through Agency MBS, particularly pass-through Agency MBS backed by fixed-rate mortgages.

~~-50-~~

We do not believe our investment portfolio will be materially affected by loan modification programs because Agency MBS backed by loans that would qualify for such programs (e.g., seriously delinquent loans) will be purchased by Fannie Mae and Freddie Mac at their par value prior to the implementation of such programs. However, if Fannie Mae and Freddie Mac were to modify or end their repurchase programs or if the U.S. Government modified its loan modification programs to modify non-delinquent mortgage loans, our investment portfolio could be negatively impacted.

Effects on our borrowing costs

We leverage our pass-through Agency MBS portfolio and a portion of our structured Agency MBS with principal balances through the use of short-term repurchase agreement transactions. The interest rates on our debt are determined by market levels of both the Federal Funds Rate and LIBOR. An increase in the U.S. Federal Funds Rate or LIBOR would increase our borrowing costs, which could affect our interest rate spread if there is no corresponding increase in the interest we earn on our assets. This would be most prevalent with respect to our Agency MBS backed by fixed rate mortgage loans because the interest rate on a fixed-rate mortgage loan does not change even though market rates may change.

In order to protect our net interest margin against increases in short-term interest rates, we may enter into interest rate swaps, which effectively convert our floating-rate repurchase agreement debt to fixed-rate debt, or utilize other hedging instruments such as Eurodollar and T-Note futures contracts or interest rate swaptions.

Summary

Over the past ~~several quarters there has been a relatively large~~quarter the spread between short and long-term interest rates remained volatile as the market reacted to economic data and changing views on future rate hikes by the Federal Reserve. This has ~~positively~~marginally affected our net interest ~~margin. However, if~~margin as spreads between Agency MBS and benchmark interest rates widened during the early stages of the first quarter before tightening during the second quarter. Prepayment rates have increased as longer term rates declined during the second quarter and, to the extent prepayment rates remain elevated, ~~or accelerate further they~~this could ~~continue to negatively affect~~put pressure on our net interest ~~margin~~margin. The markets' perception of the timing of Federal Reserve increases in interest rates and the ~~value of~~growth prospects for the global economy have changed more than once during 2016. Accordingly, economic data, as it is released, continues to have a significant impact in shaping market expectations. These developments are very important to our ~~assets. Furthermore,~~results as increases in the Federal Funds Rate and LIBOR could significantly increase our financing costs, which could lower our net interest margin.

Critical Accounting Policies

~~Management’s~~Management's discussion and analysis of financial condition and results of operations is based on the amounts reported in our consolidated financial statements. These consolidated financial statements are prepared in accordance with GAAP. The ~~Company’s~~Company's significant accounting policies are described in Note 1 to the ~~Company’s~~Company's accompanying consolidated financial statements.

-44-

GAAP requires the ~~Company’s~~Company's management to make complex and subjective decisions and assessments. The ~~Company’s~~Company's most critical accounting policies involve decisions and assessments which could significantly affect reported assets and liabilities, as well as reported revenues and expenses. The Company believes that all of the decisions and assessments upon which its financial statements are based were reasonable at the time made based upon information available to it at that time. There have been no changes to our critical accounting policies as discussed in our annual report on Form 10-K for the year ended December 31, ~~2014.~~2015.

Capital Expenditures

At June 30, ~~2015,~~2016, we had no material commitments for capital expenditures.

Off-Balance Sheet Arrangements

At June 30, ~~2015,~~2016, we did not have any off-balance sheet arrangements.

~~-51-~~

Inflation

Virtually all of our assets and liabilities are interest rate sensitive in nature. As a result, interest rates and other factors influence our performance far more so than does inflation. Changes in interest rates do not necessarily correlate with inflation rates or changes in inflation rates. Our financial statements are prepared in accordance with GAAP and our distributions will be determined by our Board of Directors consistent with our obligation to distribute to our stockholders at least 90% of our REIT taxable income on an annual basis in order to maintain our REIT qualification; in each case, our activities and balance sheet are measured with reference to historical cost and/or fair market value without considering inflation.

ITEM 3. QUANTITATIVE AND QUALITATIVE DISCLOSURES ABOUT MARKET RISK.

Not Applicable.

ITEM 4. CONTROLS AND PROCEDURES.

Evaluation of Disclosure Controls and Procedures

As of the end of the period covered by this report (the ~~“evaluation date”~~"evaluation date"), we carried out an evaluation, under the supervision and with the participation of our management, including our Chief Executive Officer (the ~~“CEO”~~"CEO") and Chief Financial Officer (the ~~“CFO”~~"CFO"), of the effectiveness of the design and operation of our disclosure controls and procedures, as defined in Rule 13a-15(e) under the Securities Exchange Act of 1934, as amended (“("Exchange ~~Act”~~Act"). Based on this evaluation, the CEO and CFO concluded our disclosure controls and procedures, as designed and implemented, were effective as of the evaluation date (1) in ensuring that information regarding the Company and its subsidiaries is accumulated and communicated to our management, including our CEO and CFO, by our employees, as appropriate to allow timely decisions regarding required disclosure and (2) in providing reasonable assurance that information we must disclose in its periodic reports under the Exchange Act is recorded, processed, summarized and reported within the time periods prescribed by the ~~SEC’s~~SEC's rules and forms.

Changes in Internal Controls over Financial Reporting

There were no significant changes in the ~~Company’s~~Company's internal control over financial reporting that occurred during the ~~Company’s~~Company's most recent fiscal quarter that have materially affected, or are reasonably likely to materially affect, the ~~Company’s~~Company's internal control over financial reporting.

~~-52-~~-45-

PART II. OTHER INFORMATION

ITEM 1. LEGAL PROCEEDINGS

~~The Company may from time~~We are not party to ~~time be involved~~any material pending legal proceedings as described in various lawsuits and claims, both pending and threatened, including some that it has asserted against others, in which monetary and other damages are sought. These lawsuits and claims relate primarily to contractual disputes arising outItem 103 of the ordinary course of the Company’s business. The outcome of such lawsuits and claims, as well as the costs to defend them, is inherently unpredictable, and management may choose to settle certain matters based on a cost-benefit analysis.

A complaint by a note-holder in Preferred Term Securities XX (“PreTSL XX”) was filed on July 16, 2010 in the Supreme Court of the State of New York, New York County, against Bimini Capital, the Bank of New York Mellon (“BNY Mellon”) and Hexagon Securities LLC (“Hexagon”) and nominal defendants BNY Mellon and Preferred Term Securities XX, Ltd. (“PreTSL XX”), captioned Hildene Capital Management, LLC, et al. v. The Bank of New York Mellon, et. al. The complaint, filed by Hildene Capital Management, LLC and Hildene Opportunities Fund, Ltd. (“Hildene”), alleged that Hildene suffered losses as a result of Bimini Capital’s repurchase of all outstanding fixed/floating rate capital securities of Bimini Capital Trust II for less than par value from PreTSL XX in October 2009. Hildene alleged claims against BNY Mellon for breach of the Indenture, breach of fiduciary duties and breach of the covenant of good faith and fair dealing, and claims against Bimini Capital for tortious interference with contract, aiding and abetting breach of fiduciary duty, unjust enrichment and “rescission/illegality.” Hildene also alleged derivative claims brought in the name of Nominal Defendant BNY Mellon. (Subsequently, Hexagon and Nominal Defendant PreTSL XX were voluntarily dismissed without prejudice by Hildene.) PreTSL XX, Ltd. moved to intervene as an additional plaintiff in the action, and Bimini and BNY Mellon opposed that motion. The court granted PreTSL XX, Ltd.’s motion to intervene and the Appellate Division, First Department affirmed that decision. In May 2013, Hildene voluntarily dismissed its purported derivative claims brought in the name of BNY Mellon, including its claim for “rescission/illegality.” On April 14, 2014 and May 18, 2014, Stipulations of Partial Discontinuance were filed with the court that dismissed all claims between and among Hildene and BNY Mellon, and PreTSL XX and BNY Mellon.

On May 15, 2015, Hildene and Bimini Capital reached an agreement to settle the case, and on July 10, 2015, a Stipulation of Discontinuance was filed dismissing all claims and counterclaims between and among Hildene and Bimini Capital. In connection with the settlement and in accordance with GAAP, a loss of $3.5 million has been charged to operations for the six months ended June 30, 2015.

Regulation S-K.

ITEM 1A. RISK FACTORS.

~~Except as set forth below, there~~There have been no material changes from the risk factors disclosed in the ~~“Risk Factors”~~"Risk Factors" section of our Annual Report on Form 10-K filed with the SEC on March ~~16, 2015.~~22, 2016.

~~Risks Related to Our Business~~

~~Payments to be made in the settlement of a legal action could have an adverse effect on our liquidity, financial condition and results of operations.~~

In May 2015, Bimini Capital reached an agreement to settle a legal action as more fully described in Note 10 to the financial statements. Although payments under the settlement agreement will reduce the Company’s liquidity, management believes that the Company will be able to generate sufficient cash from its operations to meet the payment obligations as they come due. If the Company is unable to generate sufficient cash, it may be required to liquidate a portion of its MBS portfolio, which could have an adverse effect of the Company’s ability to generate interest income, its results of operations, and its financial condition.

~~-53-~~

ITEM 2. UNREGISTERED SALES OF EQUITY SECURITIES AND USE OF PROCEEDS

None.

During the three months ended June 30, 2015, the Company issued 9,822 and 4,048 shares of Class A Common Stock to Robert J. Dwyer and Frank E. Jaumot, respectively, in consideration for their service on the Company’s Board of Directors and on certain committees of the Board of Directors. The shares were issued pursuant to the exemption from registration under the Securities Act of 1933, as amended, contained in Section 4(a)(2) thereof.

ITEM 3. DEFAULTS UPON SENIOR SECURITIES

None.

ITEM 4. MINE SAFETY DISCLOSURES.

Not Applicable.

ITEM 5. OTHER INFORMATION

None.

~~-54-~~-46-

ITEM 6. EXHIBITS

Exhibit No

3.1	Articles of Amendment and Restatement, incorporated by reference to Exhibit 3.1 to the ~~Company’s~~Company's Form S-11/A, filed with the SEC on April 29, 2004
3.2	Articles Supplementary, incorporated by reference to Exhibit 3.1 to the ~~Company’s~~Company's Current Report on Form 8-K, dated November 3, 2005, filed with the SEC on November 8, 2005
3.3	Articles of Amendment, incorporated by reference to Exhibit 3.1 to the ~~Company’s~~Company's Current Report on Form 8-K, dated February 10, 2006, filed with the SEC on February 15, 2006
3.4	Articles of Amendment, incorporated by reference to Exhibit 3.1 to the ~~Company’s~~Company's Current Report on Form 8-K, dated September 24, 2007, filed with the SEC on September 24, 2007
3.5	Amended and Restated Bylaws, incorporated by reference to Exhibit 3.2 to the ~~Company’s~~Company's Current Report on Form 8-K, dated September 24, 2007, filed with the SEC on September 24, 2007
~~10.1~~		Settlement Agreement and Release by and among Bimini Capital Management, Inc. Preferred Term Securities XX, Ltd., Hildene Capital Management, LLC and Hildene Opportunities Master Fund, Ltd. Dated May 15, 2015.*
31.1	Certification of the Principal Executive Officer, pursuant to Rule 13a-14(a) or 15d-14(a) of the Securities Exchange Act of 1934, as adopted pursuant to Section 302 of the Sarbanes Oxley Act of 2002*
31.2	Certification of the Principal Financial Officer, pursuant to Rule 13a-14(a) or 15d-14(a) of the Securities Exchange Act of 1934, as adopted pursuant to Section 302 of the Sarbanes Oxley Act of 2002*
32.1	Certification of the Chief Executive Officer, pursuant to 18 U.S.C. Section 1350, as adopted pursuant to Section 906 of the Sarbanes Oxley Act of 2002**
32.2	Certification of the Chief Financial Officer, pursuant to 18 U.S.C. Section 1350, as adopted pursuant to Section 906 of the Sarbanes Oxley Act of 2002**

101.INS		Instance Document***
101.SCH		Taxonomy Extension Schema Document***
101.CAL		Taxonomy Extension Calculation Linkbase Document***
101.DEF		Additional Taxonomy Extension Definition Linkbase Document***
101.LAB		Taxonomy Extension Label Linkbase Document***
101.PRE		Taxonomy Extension Presentation Linkbase Document***

Filed herewith.

Furnished herewith

***

Submitted electronically herewith.

~~-55-~~-47-

Signatures

Pursuant to the requirements of Section 13 or 15(d) of the Securities Exchange Act of 1934, as amended, the registrant has duly caused this report to be signed on its behalf by the undersigned, thereunto duly authorized.

BIMINI CAPITAL MANAGEMENT, INC.

Date:August ~~5, 2015~~10, 2016		By:	~~/s/~~/s/ Robert E. Cauley
			Robert E. Cauley Chairman and Chief Executive Officer

Date:August ~~5, 2015~~10, 2016		By:	~~/s/~~/s/ G. Hunter Haas IV
			G. Hunter Haas, IV President, Chief Financial Officer, Chief Investment Officer and Treasurer (Principal Financial Officer and Principal Accounting Officer)

-48-


	Maryland		72-1571637
	(State or other jurisdiction of incorporation or organization)		(I.R.S. Employer Identification No.)

Retained interests fair value (in thousands)			$	2,141
		CPR Range
Prepayment Assumption		(Weighted Average)
Constant Prepayment Rate		10% (10%)
		Severity
Default Assumptions	Probability of Default	(Weighted Average)		Range Of Loss Timing
Real Estate Owned	100%	35%		Next 10 Months
Loans in Foreclosure	100%	35%		Month 4 - 13
Loans 90 Day Delinquent	100%	45%		Month 11-28
Loans 60 Day Delinquent	85%	45%		Month 11-28
Loans 30 Day Delinquent	75%	45%		Month 11-28
Current Loans	2.5%	45%		Month 29 and Beyond
		Remaining Life Range		Discount Rate Range
Cash Flow Recognition	Valuation Technique	(Weighted Average)		(Weighted Average)
Nominal Cash Flows	Discounted Cash Flow	0.2 - 13.2 (6.5)		27.50% (27.50%)
Discounted Cash Flows	Discounted Cash Flow	0.2 - 3.6 (1.0)		27.50% (27.50%)

Retained interests fair value (in thousands)							$	1,359
				CPR Range
Prepayment Assumption				(Weighted Average)
Constant Prepayment Rate					10% (10	%)
				Severity
Default Assumptions	Probability of Default			(Weighted Average)			Range Of Loss Timing
Real Estate Owned		100	%		33	%	Next 10 Months
Loans in Foreclosure		100	%		33	%	Month 4 - 13
Loans 90 Day Delinquent		100	%		45	%	Month 11-28
Loans 60 Day Delinquent		85	%		45	%	Month 11-28
Loans 30 Day Delinquent		75	%		45	%	Month 11-28
Current Loans		3.1	%		45	%	Month 29 and Beyond
				Remaining Life Range			Discount Rate Range
Cash Flow Recognition	Valuation Technique			(Weighted Average)			(Weighted Average)
Nominal Cash Flows	Discounted Cash Flow				0.2 - 15.1	(11.2)		27.50% (27.50	%)
Discounted Cash Flows	Discounted Cash Flow				0.2 - 2.6	(1.3)		27.50% (27.50	%)

($ in thousands)
Net income attributable to Bimini Capital	$	5,699
Transfers from the noncontrolling interests
Decrease in Bimini Capital's paid-in capital for the sale of 6,290,443 common shares of Orchid
and the effect of the 24,000 shares of unvested restricted shares of Orchid		(1,004	)
Change from net income attributable to Bimini Capital and transfers from noncontrolling interest	$	4,695

(in thousands)
Balance, January 1, 2014	$	31,615
Issuance of common shares of Orchid Island Capital, Inc.		76,120
Net income attributed to noncontrolling interest		12,538
Amortization of Orchid Island Capital, Inc. equity plan compensation		16
Cash dividends paid to noncontrolling interest		(7,378	)
Balance, June 30, 2014	$	112,911


Bimini Capital Management, Inc.
(Exact name of registrant as specified in its charter)

($ in thousands)
			% of			Weighted
			Stockholders'			Average
	Amount		Equity			Maturity
Repurchase Agreement Counterparties	at Risk		at Risk			(in Days)
June 30, 2015
Citigroup Global Markets, Inc.	$	2,532		39.8	%		14
JVB Financial Group, LLC		1,517		23.9	%		10
ED&F Man Capital Markets Inc.		1,465		23.0	%		33
South Street Securities, LLC		812		12.8	%		20
CRT Capital Group, LLC		685		10.8	%		15
December 31, 2014
JVB Financial Group, LLC	$	1,807		19.6	%		8
ED&F Man Capital Markets Inc.		1,490		16.2	%		22

(in thousands)
	Consolidated						Parent-Only
Six Months Ended June 30,	2015			2014			2015			2014
Eurodollar futures contracts (short positions)	$	(1,009	)	$	(6,306	)	$	(1,009	)	$	(170	)
Payer swaptions		-			(1,285	)		-			-
Net losses on derivative instruments	$	(1,009	)	$	(7,591	)	$	(1,009	)	$	(170	)

			Weighted-
			Average
			Grant-Date
	Shares		Fair Value
Fully vested shares granted		500,000	$	0.38

	June 30, 2015		December 31, 2014
Nonvested performance units outstanding at period end		31,500		31,500
Weighted-average grant date fair price	$	1.78	$	1.78
Unrecognized compensation expense at period end	$	45,946	$	55,291
Weighted-average remaining vesting term (in years)		2.50		3.00
Intrinsic value of unvested shares at period end	$	88,200	$	59,850

(in thousands, except per-share information)
	Six Months Ended June 30,						Three Months Ended June 30,					Six Months Ended June 30,						Three Months Ended June 30,
	2015			2014			2015			2014		2016			2015			2016			2015
Basic and diluted EPS per Class A common share:
(Loss) income attributable to Class A common shares:
Income (loss) attributable to Class A common shares:
Basic and diluted	$	(2,886	)	$	5,684		$	(1,500	)	$	3,321	$	1,045		$	(2,886	)	$	600		$	(1,500	)
Weighted average common shares:
Class A common shares outstanding at the balance sheet date		12,346			12,295			12,346			12,295		12,632			12,346			12,632			12,346
Unvested dividend-eligible stock incentive plan shares
outstanding at the balance sheet date													78			-			78			-
Effect of weighting		(7	)		(223	)		-			-		(22	)		(7	)		(1	)		-
Weighted average shares-basic and diluted		12,339			12,072			12,346			12,295		12,688			12,339			12,709			12,346
(Loss) income per Class A common share:
Income (loss) per Class A common share:
Basic and diluted	$	(0.23	)	$	0.47		$	(0.12	)	$	0.27	$	0.08		$	(0.23	)	$	0.05		$	(0.12	)

(in thousands)
			Quoted Prices
			in Active		Significant
			Markets for		Other		Significant
			Identical		Observable		Unobservable
	Fair Value		Assets		Inputs		Inputs
	Measurements		(Level 1)		(Level 2)		(Level 3)
June 30, 2015
Mortgage-backed securities	$	107,761	$	-	$	107,761	$	-
Eurodollar futures contracts		488		488		-		-
Orchid Island Capital, Inc. common stock		11,004		11,004		-		-
Retained interests		2,141		-		-		2,141
December 31, 2014
Mortgage-backed securities	$	117,831	$	-	$	117,831	$	-
Eurodollar futures contracts		476		476		-		-
Orchid Island Capital, Inc. common stock		12,811		12,811		-		-
Retained interests		1,900		-		-		1,900