Crystal River Reports First Quarter 2009 Financial Results

Market Wire, May, 2009

Crystal River Capital, Inc. ("Crystal River" or the "Company") (OTCBB: CYRV) -

Crystal River's management will host a dial-in teleconference to review its first quarter 2009 financial results on May 7, 2009 at 9:00 a.m. (EDT). The teleconference can be accessed by dialing 888-221-9542 or 913-312-0641 (International). A replay of the recorded teleconference will be available through May 21, 2009. The replay can be accessed by dialing 888-203-1112 or 719-457-0820 (International) and entering passcode 7542945. A live audio webcast of the call will be accessible on the Company's website, www.crystalriverreit.com , via a link from the Investor Relations section. A replay of the audio webcast will be archived in the Investor Relations section of the Company's website.

Crystal River Capital, Inc. ("Crystal River" or the "Company") (OTCBB: CYRV) today announced its results for the quarter ended March 31, 2009.

Separately, the Company announced that its Board of Directors has declared a second quarter 2009 dividend of $0.10 per share.

For additional information, please refer to Crystal River's letter to stockholders, which has been posted to the Investor Relations section of the Company's website at www.crystalriverreit.com .

I. FIRST QUARTER UPDATE

- Liquidity and leverage update: After eliminating its repurchase agreement debt in the fourth quarter of 2008, Crystal River continued its focus on reducing leverage by decreasing the amount drawn under the Company's revolving credit facility to $28.9 million at March 31, 2009 from $32.9 million at December 31, 2008.

- Operating results: The net loss for the quarter ended March 31, 2009 totaled $10.0 million, or $0.40 per share, compared to a net loss of $137.7 million, or $5.56 per share, for the first quarter of 2008 and a net loss of $37.1 million, or $1.48 per share, for the fourth quarter of 2008. The primary contributors to the first quarter 2009 net loss were a $5.8 million impairment charge against the Company's available-for-sale securities and a $9.9 million net decrease in assets and liabilities valued under fair value option, which was partially offset by realized and unrealized gains on derivatives totaling $3.9 million. Finally, the Company also recorded a $6.8 million loan loss allowance on its real estate loan holdings during the quarter ended March 31, 2009.

Operating Earnings (defined below) for the quarter ended March 31, 2009 totaled $8.5 million, or $0.34 per share, compared to $19.5 million, or $0.79 per share, for the first quarter of 2008 and $17.1 million, or $0.68 per share, for the fourth quarter of 2008. The decrease compared to the first quarter of 2008 was primarily attributable to lower interest income resulting from the sale of the Company's Agency MBS portfolio in 2008. The decrease compared to the fourth quarter of 2008 was primarily attributable to lower principal payment receipts on previously written-off residential mortgage-backed securities.

- Dividend coverage: Cash flow from operations for the first quarter of 2009 represented in excess of two times coverage of the current dividend of approximately $2.5 million, and the remainder was used to pay down liabilities.

Dividend Information

Crystal River announced that its Board of Directors declared a cash distribution for the quarter ended June 30, 2009 of $0.10 per share of common stock. The cash distribution will be paid on July 31, 2009 to stockholders of record as of the close of business on June 30, 2009.

In setting the dividend, the Board of Directors considered a number of factors, including, but not limited to, operating results, taxable income and REIT qualification requirements, available tax losses, economic conditions, capital requirements, liquidity, retention of capital and other operating trends. Given the variability of these considerations, the Board of Directors will continually reevaluate these factors when determining future dividends.

About Crystal River

Crystal River Capital, Inc. (OTCBB: CYRV) is a specialty finance REIT. The Company invests in commercial real estate, real estate loans, and real estate-related securities, such as commercial and residential mortgage-backed securities. For more information, visit www.crystalriverreit.com .