Unassociated Document

Contacts:

Media: Lauren Burk at 703.469.1004 or lburk@fbr.com

Investors: Paul Beattie at 703.312.9673 or pbeattie@fbr.com

FBR Group Reports First Quarter Earnings

ARLINGTON, VA, April 24, 2008 - Friedman, Billings, Ramsey Group, Inc. (FBR Group; NYSE: FBR) today reported net after-tax earnings of $45.1 million, or $0.30 per share (diluted), for the quarter ended March 31, 2008 compared to a net after-tax loss of $185.9 million, or $1.08 per share (diluted) in the first quarter of 2007.

FBR Group ended the quarter with $667 million of consolidated total capital, including $318 million of trust preferred securities. Of this capital, $259 million was attributable to FBR Group’s 52% ownership interest in FBR Capital Markets Corporation (FBR Capital Markets) (NASDAQ: FBCM). Of the remaining $408 million in capital, FBR Group had approximately $240 million invested in cash and agency securities at the end of the first quarter. Book value net of Accumulated Other Comprehensive Income (AOCI)⁽¹⁾as of March 31, 2008 was $3.02 per share compared to book value net of AOCI of $2.70 as of December 31, 2007.

The first quarter 2008 results reflect:

a $73.0 million non-cash GAAP reversal of pre-bankruptcy losses relating to First NLC Financial Services (FNLC),

$3.4 million of losses related primarily to pre-bankruptcy FNLC activities,

$15.0 million of investment-related losses, including $3.6 million related to merchant banking and $10.6 million related to non-prime securities,

a $4.2 million net operating loss at FBR Group for the quarter, and

a $5.3 million loss, representing FBR Group’s proportionate share of 52%-owned FBR Capital Markets’ first quarter loss.

The $372 million net operating loss carry-forward and the $268 million of capital loss carry-forward disclosed last quarter remain a potential future economic benefit.

“We benefited from low leverage and a strong liquidity position during the quarter,” said J. Rock Tonkel, Jr., President and Chief Operating Officer of FBR Group. “Going forward, we expect to benefit from the full effect of the $578 million of agency hybrid securities added during the first quarter which had a spread in excess of 225 basis points on March 31^st. In addition, we have reduced operating expenses from ongoing operations by 28% from the average 2007 quarterly run-rate, and we expect additional cost reductions during the remainder of 2008.”

Mortgage Investment Portfolio

Excluding FBR Capital Markets, FBR Group's investments in mortgage-backed securities (MBS), primarily government agency securities, averaged $1.9 billion with a one-month CPR of 9.9, and an ending net premium of $13 million. The net yield on MBS for the first quarter was 4.76% with a corresponding cost of funds of 3.76% for a net spread of 1.00%. At the end of the quarter, total MBS was $2.5 billion with a yield of 4.22% and a cost of funds of 2.81% for a net spread of 1.41%.

Merchant Banking

Excluding merchant banking investments of $54.0 million at FBR Capital Markets, the total value of the merchant banking investments held by FBR Group at the close of the first quarter was $44.5 million.

Looking Ahead

“We continue to examine strategies to maximize the economic benefit that can be derived from the Company’s substantial net operating and capital loss carry-forwards,” said Eric F. Billings, Chairman and Chief Executive Officer of FBR Group. “Our balance sheet at the end of the quarter includes $408 million of long-term capital, approximately $240 million of which is in cash and highly liquid agency securities. This financial strength positions us well to manage through the current environment with a goal of growing earnings and capital and increasing shareholder value as we continue to implement our core strategy of investing in a leveraged portfolio of hybrid agency mortgage-backed securities on a hedged basis.”

FBR Capital Markets Corporation

FBR Capital Markets yesterday reported a net after-tax loss of $10.2 million, or $0.16 per share (diluted), for the quarter ended March 31, 2008, compared to net after-tax income of $11.0 million, or $0.17 per share (diluted) in the first quarter of 2007.

Net revenues for the first quarter were $104.0 million compared to net revenues of $60.7 million in the fourth quarter of 2007 and $143.2 million in first quarter of 2007. At the close of the first quarter, FBR Capital Markets had $503.0 million in equity, $313.3 million of cash, and a book value of $7.77 per share.

Complete financial results and tables for FBR Capital Markets can be found at www.fbr.com.

FBR Group will host an earnings conference call this morning, Thursday, April 24, 2008 at 9:00 A.M. U.S. EDT. Investors wishing to listen to the call may do so via the web at:

http://phx.corporate-ir.net/phoenix.zhtml?c=71352&p=irol-irhome.

Replays of the webcast will be available after the call.

Friedman, Billings, Ramsey Group, Inc. (FBR) invests in mortgage-related assets, merchant banking opportunities and is the majority owner of FBR Capital Market Corporation, a separate publicly traded company. FBR is headquartered in the Washington, D.C. metropolitan area. For more information, please visit www.fbr.com.

¹Accumulated Other Comprehensive Income (AOCI) includes changes in the value of available-for-sale securities and cash flow hedges. FBR believes that such changes represent temporary market fluctuations, are not reflective of our market strategy, and, therefore, the exclusion of AOCI provides a reasonable basis for calculating returns.

Statements concerning future performance, developments, events, market forecasts, revenues, expenses, earnings, run rates and any other guidance on present or future periods, constitute forward-looking statements that are subject to a number of factors, risks and uncertainties that might cause actual results to differ materially from stated expectations or current circumstances. These factors include, but are not limited to, the effect of demand for public offerings, activity in the secondary securities markets, interest rates, costs of borrowing, interest spreads, mortgage pre-payment speeds, risks associated with merchant banking investments, the realization of gains and losses on principal investments, available technologies, competition for business and personnel, and general economic, political and market conditions. These and other risks are described in the Company's Annual Report and Form 10-K and quarterly reports on Form 10-Q that are available from the company and from the SEC.

Financial data follows.

# # #

FRIEDMAN, BILLINGS, RAMSEY GROUP, INC.

CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS

(Dollars in thousands, except per share amounts)

(Unaudited)

	Three Months Ended March 31,
	2008			%			2007			%
REVENUES:
Investment banking:
Capital raising	$	64,910			70.3	%	$	97,247			787.6	%
Advisory		5,076			5.5	%		6,458			52.3	%
Institutional brokerage:
Principal transactions		5,957			6.5	%		2,036			16.5	%
Agency commissions		25,850			28.0	%		23,818			192.9	%
Asset management:
Base management fees		4,644			5.0	%		5,528			44.8	%
Incentive allocations and fees		-			0.0	%		104			0.8	%
Principal investment:
Interest		25,914			28.1	%		181,696			1471.6	%
Net investment loss		(19,687	)		-21.3	%		(59,713	)		-483.6	%
Dividends		429			0.5	%		959			7.8	%
Mortgage banking:
Interest		36			0.0	%		26,530			214.9	%
Net investment income (loss)		468			0.5	%		(106,859	)		-865.5	%
Other		2,335			2.5	%		4,094			33.1	%
Total revenues		115,932			125.6	%		181,898			1473.2	%
Interest expense		23,650			25.6	%		169,551			1373.2	%
Revenues, net of interest expense		92,282			100.0	%		12,347			100.0	%

NON-INTEREST EXPENSES:
Compensation and benefits		76,954			83.4	%		103,982			842.2	%
Professional services		12,467			13.5	%		13,854			112.2	%
Business development		12,294			13.3	%		13,769			111.5	%
Clearing and brokerage fees		3,630			3.9	%		2,701			21.9	%
Occupancy and equipment		9,189			10.0	%		13,117			106.2	%
Communications		6,018			6.5	%		7,051			57.1	%
Other operating expenses		5,384			5.8	%		31,716			256.8	%
Goodwill impairment		-			0.0	%		25,852			209.3	%
Restructuring charges		-			0.0	%		15,485			125.3	%
Total non-interest expenses		125,936			136.4	%		227,527			1842.5	%

Operating loss		(33,654	)		-36.4	%		(215,180	)		-1742.5	%

OTHER INCOME:
Gain on disposition of subsidiary and other income		73,037			79.1	%		831			6.7	%

Income (loss) before income taxes and minority interest		39,383			42.7	%		(214,349	)		-1736.0	%

Income tax benefit		(806	)		-0.9	%		(31,550	)		-255.5	%
Minority interest in (losses) earnings of consolidated subsidiary		(4,913	)		-5.3	%		3,079			24.9	%

Net income (loss)	$	45,102			48.9	%	$	(185,878	)		-1505.4	%

Basic earnings (loss) per share	$	0.30					$	(1.08	)
Diluted earnings (loss) per share	$	0.30					$	(1.08	)

Weighted average shares - basic (in thousands)		150,784						172,850
Weighted average shares - diluted (in thousands)		151,419						172,850

FRIEDMAN, BILLINGS, RAMSEY GROUP, INC.

Financial & Statistical Supplement - Operating Results

(Dollars in thousands, except per share data)

(Unaudited)

	Q-1 08
Revenues
Investment banking:
Capital raising	$	64,910
Advisory		5,076
Institutional brokerage:
Principal transactions		5,957
Agency commissions		25,850
Asset management:
Base management fees		4,644
Principal investment:
Interest		25,914
Net investment loss		(19,687	)
Dividends		429
Mortgage banking:
Interest		36
Net investment income		468
Other		2,335
Total revenues		115,932
Interest expense		23,650
Revenues, net of interest expense		92,282

Non-interest expenses
Compensation and benefits		76,954
Professional services		12,467
Business development		12,294
Clearing and brokerage fees		3,630
Occupancy and equipment		9,189
Communications		6,018
Other operating expenses		5,384
Total non-interest expenses		125,936

Operating loss		(33,654	)

Other income
Gain on disposition of subsidiary and other income		73,037

Net income before income taxes and minority interest		39,383

Income tax benefit		(806	)
Minority interest in losses of consolidated subsidiary		(4,913	)

Net income	$	45,102


ROE (annualized)		48.9	%
ROE (annualized-excluding AOCI) (1)		41.8	%

Total shareholders' equity	$	344,408
Total shareholders' equity, net of AOCI (1)	$	455,761


Basic earnings per share	$	0.30
Diluted earnings per share	$	0.30

Ending shares outstanding (in thousands)		150,915

Book value per share	$	2.28
Book value per share, net of AOCI (1)	$	3.02

Gross assets under management (in millions)
Managed accounts	$	333.9
Hedge & offshore funds		45.1
Mutual funds		1,702.9
Private equity and venture capital funds		21.4
Total	$	2,103.3

Net assets under management (in millions)
Managed accounts	$	333.9
Hedge & offshore funds		40.4
Mutual funds		1,698.0
Private equity and venture capital funds		20.2
Total	$	2,092.5

Employee count		726

(1)

Accumulated Other Comprehensive Income (AOCI) includes changes in value of available-for-sale securities and cash flow hedges. We believe that such changes represent temporary market fluctuations, are not reflective of our market strategy, and therefore, exclusion of AOCI provides a reasonable basis for calculating returns.

FRIEDMAN, BILLINGS, RAMSEY GROUP, INC.

Financial & Statistical Supplement - Operating Results

(Dollars in thousands, except per share data)

(Unaudited)


	For the twelve months ended
	December 31, 2007			Q-4 07			Q-3 07			Q-2 07			Q-1 07
Revenues
Investment banking:
Capital raising	$	282,619		$	25,648		$	49,692		$	110,032		$	97,247
Advisory		34,063			4,973			16,480			6,152			6,458
Institutional brokerage:
Principal transactions		10,152			2,996			968			4,152			2,036
Agency commissions		104,792			26,153			26,257			28,564			23,818
Asset management:
Base management fees		23,549			5,542			6,119			6,360			5,528
Incentive allocations and fees		401			99			82			116			104
Principal investment:
Interest		501,130			51,057			115,450			152,927			181,696
Net investment loss		(221,956	)		(22,327	)		(136,475	)		(3,441	)		(59,713	)
Dividends		3,173			805			526			883			959
Mortgage banking:
Interest		51,245			4,059			7,194			13,462			26,530
Net investment loss		(222,032	)		(83,174	)		(27,968	)		(4,031	)		(106,859	)
Other		15,808			3,242			3,990			4,482			4,094
Total revenues		582,944			19,073			62,315			319,658			181,898
Interest expense		477,437			52,583			112,072			143,231			169,551
Revenues, net of interest expense		105,507			(33,510	)		(49,757	)		176,427			12,347

Non-interest expenses
Compensation and benefits		361,355			69,533			80,955			106,885			103,982
Professional services		55,741			15,598			12,281			14,008			13,854
Business development		43,518			10,878			7,713			11,158			13,769
Clearing and brokerage fees		12,514			2,797			3,953			3,063			2,701
Occupancy and equipment		52,302			13,791			12,695			12,699			13,117
Communications		28,690			6,899			7,148			7,592			7,051
Other operating expenses		82,246			15,706			16,140			18,684			31,716
Impairment of goodwill		162,765			108,013			-			28,900			25,852
Restructuring charges		46,985			21,466			6,172			3,862			15,485
Total non-interest expenses		846,116			264,681			147,057			206,851			227,527

Operating loss		(740,609	)		(298,191	)		(196,814	)		(30,424	)		(215,180	)

Other income (loss)
Gain (loss) on sale of subsidiary shares		104,062			4			(2,450	)		105,677			831

(Loss) income before income taxes
and minority interest		(636,547	)		(298,187	)		(199,264	)		75,253			(214,349	)

Income tax provision (benefit)		22,932			(15,817	)		15,288			55,011			(31,550	)
Minority interest in earnings (losses) of consolidated subsidiary		774			(12,008	)		165			9,538			3,079

Net (loss) income	$	(660,253	)	$	(270,362	)	$	(214,717	)	$	10,704		$	(185,878	)


ROE (annualized)		-84.4	%		-138.2	%		-91.9	%		3.9	%		-68.8	%
ROE (annualized-excluding AOCI) (1)		-82.9	%		-135.8	%		-90.5	%		3.9	%		-68.2	%


Total shareholders' equity	$	393,691		$	393,691		$	698,214		$	1,012,635		$	989,213
Total shareholders' equity, net of AOCI (1)	$	406,537		$	406,537		$	711,693		$	1,000,071		$	993,753

Basic (loss) earnings per share	$	(3.95	)	$	(1.77	)	$	(1.28	)	$	0.06		$	(1.08	)
Diluted (loss) earnings per share	$	(3.95	)	$	(1.77	)	$	(1.28	)	$	0.06		$	(1.08	)

Ending shares outstanding (in thousands)		150,674			150,674			158,671			173,756			172,846

Book value per share	$	2.61		$	2.61		$	4.40		$	5.83		$	5.72
Book value per share, net of AOCI (1)	$	2.70		$	2.70		$	4.49		$	5.76		$	5.75

Gross assets under management (in millions)
Managed accounts	$	347.1		$	347.1		$	345.6		$	291.3		$	258.8
Hedge & offshore funds		52.1			52.1			61.7			61.7			67.1
Mutual funds		2,046.5			2,046.5			2,292.3			2,482.6			2,412.9
Private equity and venture capital funds		23.8			23.8			31.3			33.8			41.2
Total	$	2,469.5		$	2,469.5		$	2,730.9		$	2,869.4		$	2,780.0

Net assets under management (in millions)
Managed accounts	$	347.1		$	347.1		$	345.6		$	291.3		$	258.8
Hedge & offshore funds		50.7			50.7			58.1			58.1			62.5
Mutual funds		2,034.6			2,034.6			2,285.1			2,474.7			2,406.4
Private equity and venture capital funds		22.6			22.6			29.8			32.0			38.0
Total	$	2,455.0		$	2,455.0		$	2,718.6		$	2,856.1		$	2,765.7

Employee count		1,025			1,025			1,290			2,151			2,592

(1)

FRIEDMAN, BILLINGS, RAMSEY GROUP, INC.

CONSOLIDATED BALANCE SHEETS

(Dollars and shares in thousands, except per share amounts)

(Unaudited)


ASSETS	31-Mar-08			31-Dec-07

Cash and cash equivalents	$	337,041		$	692,360
Restricted cash		178			14,166
Receivables		69,322			75,357
Investments:
Mortgage-backed securities, at fair value		2,770,334			1,791,480
Loans held for sale, net		-			65,074
Long-term investments		145,465			169,274
Trading securities, at fair value		42,675			19,057
Due from clearing broker		15,950			-
Derivative assets, at fair value		1,699			3,514
Intangible assets, net		10,147			9,837
Furniture, equipment, software and leasehold improvements, net		27,742			30,451
Prepaid expenses and other assets		70,183			74,385
Total assets	$	3,490,736		$	2,944,955


LIABILITIES AND SHAREHOLDERS ’ EQUITY

Liabilities:
Trading account securities sold short but	$	60		$	206
not yet purchased, at fair value
Repurchase agreements		2,458,550			1,744,377
Derivative liabilities, at fair value		10,937			3,558
Interest payable		2,697			2,991
Accrued compensation and benefits		38,480			57,000
Accounts payable, accrued expenses and other liabilities		69,287			105,456
Due to clearing broker		-			7,059
Short-term loan financing		-			63,981
Long-term debt		322,155			323,575
Total liabilities		2,902,166			2,308,203

Minority interest		244,162			243,061

Shareholders' equity:
Common stock, 159,505 and 151,883 shares		1,595			1,519
Additional paid-in capital		1,472,623			1,468,801
Accumulated other comprehensive loss, net of taxes		(111,353	)		(12,846	)
Accumulated deficit		(1,018,457	)		(1,063,783	)
Total shareholders' equity		344,408			393,691

Total liabilities and shareholders' equity	$	3,490,736		$	2,944,955

000-50230	54-1873198
(Commission File Number)	(IRS Employer Identification No.)


99.1				Friedman, Billings, Ramsey Group, Inc. Press Release dated April 24, 2008.


Date: April 24, 2008	By:	/s/ Kurt R. Harrington Kurt R. Harrington Executive Vice President and Chief Financial Officer, Friedman, Billings, Ramsey Group, Inc.