The Board of Directors of Capstead Mortgage Corporation (NYSE: CMO) announced today that it will pay a regular monthly dividend of $0.105 per share on the $1.26 Cumulative Convertible Preferred Stock, Series B (NYSE: CMOPRB). The dividend is payable on November 28 to preferred stockholders of record as of November 17, 2008.

Effective September 30, 2008, each Series B Preferred share is convertible into 0.6047 shares of common stock. Effective October 1, 2008, each Series A Preferred share is convertible into 1.5684 shares of common stock.

Holders of the Series A and B preferred shares may convert into shares of the Company's common stock at any time; however, preferred shareholders are advised to carefully consider whether or not it is economically advantageous to do so. Any conversion requested after one or more preferred record dates within the quarter and on or before the record date for payment of the quarterly common stock dividend will require payment to the Company of all preferred share dividends declared and paid for the corresponding quarter.

Capstead Mortgage Corporation, formed in 1985 and based in Dallas, Texas, is a self-managed real estate investment trust for federal income tax purposes. Capstead’s core strategy is managing a leveraged portfolio of residential mortgage pass-through securities consisting almost exclusively of adjustable-rate mortgage securities issued and guaranteed by government-sponsored entities, either Fannie Mae or Freddie Mac, or by an agency of the federal government, Ginnie Mae. Agency-guaranteed residential mortgage securities carry an implied AAA credit rating with limited, if any, credit risk that has been enhanced by the recent conservatorship of Fannie Mae and Freddie Mac by the federal government.

Capstead Mortgage Corporation, Dallas
Stockholder Relations, 214-874-2354