Dynex Capital, Inc. Announces Preferred Stock Dividend and Results of the Election of the Board of Directors

Business Wire, June 21, 2006

GLEN ALLEN, Va. -- Dynex Capital, Inc. (NYSE: DX) announced today that its Board of Directors has declared a dividend on its Series D Cumulative Convertible Preferred Stock of $0.2375 per share for the second quarter of 2006. The dividend will be payable on August 1, 2006, to holders of record of the Series D Preferred Stock as of June 30, 2006.

The Company also announced the results of the Board of Directors election from the Annual Shareholder Meeting held on June 15, 2006. Thomas B. Akin, Daniel K. Osborne, and Eric P. Von der Porten were elected by the holders of Common Stock. Leon A. Felman and Barry Igdaloff were elected by the holders of Series D Preferred Stock. Each Common Stock Director and each Series D Preferred Stock Director will serve until the next annual meeting and until their successors are elected and duly qualified.

Dynex Capital, Inc. is a financial services company that elects to be treated as a real estate investment trust (REIT) for federal income tax purposes. Additional information about Dynex Capital, Inc. is available at www.dynexcapital.com.

Note: This document contains "forward-looking statements" within the meaning of the Private Securities Litigation Reform Act of 1995. The words "believe," "expect," "forecast," "anticipate," "estimate," "project," "plan, " and similar expressions identify forward-looking statements that are inherently subject to risks and uncertainties, some of which cannot be predicted or quantified. The Company's actual results and timing of certain events could differ materially from those projected in or contemplated by the forward-looking statements as a result of unforeseen external factors. These factors may include, but are not limited to, changes in general economic and market condition, variability in investment portfolio cash flows, availability of suitable reinvestment opportunities, defaults by borrowers, fluctuations in interest rates, fluctuations in property capitalization rates and values of commercial real estate, defaults by third-party servicers, prepayments of investment portfolio assets, other general competitive factors, the impact of regulatory changes, and the impact of Section 404 of the Sarbanes-Oxley Act of 2002. For additional information, see the Company's Annual Report on Form 10-K for the period ended December 31, 2005, and Quarterly Report on Form 10-Q for the period ended March 31, 2006, as filed with the Securities and Exchange Commission.