Capstead Mortgage Corporation Announces Closing of Public Offering of 11.5 Million Common Shares, Including the Full Exercise of the Related Over-Allotment Option.

DALLAS -- Capstead Mortgage Corporation (NYSE:CMO) announced today that on October 2, 2007 the Company closed its pubic offering of 11.5 million common shares, including a 1.5 million share over-allotment option granted to the underwriters that was exercised in full on October 1, 2007. Capstead received aggregate net proceeds of approximately $105.5 million after underwriting discounts, commissions and estimated offering expenses.

Capstead intends to use the net proceeds from this offering to finance purchases of additional adjustable-rate mortgage, or ARM, Fannie Mae, Freddie Mac or Ginnie Mae-guaranteed residential mortgage-backed securities, on a leveraged basis, and for general corporate purposes.

Bear, Stearns & Co. Inc., Keefe, Bruyette & Woods, Inc. and JMP Securities LLC acted as joint book-running managers for the offering. RBC Capital Markets acted as a co-manager.

About Capstead

Capstead Mortgage Corporation operates as a self-managed real estate investment trust for federal income tax purposes and is based in Dallas, Texas. Capstead's core strategy is managing a leveraged portfolio of residential mortgage securities consisting primarily of ARM securities issued and guaranteed by government sponsored entities, either Fannie Mae or Freddie Mac, or by an agency of the federal government, Ginnie Mae, which are referred to collectively as Agency Securities. Agency Securities carry an actual or implied AAA rating with limited, if any, credit risk. Capstead also seeks to prudently augment its core portfolio with investments in credit-sensitive commercial real estate-related assets.