Summary of ANTHRACITE CAPITAL INC

Item 8.01. Other Events.

The Company reported the following results on August 8, 2008:

The Company today reported net income available to common stockholders for the second quarter of 2008 of $0.34 per share, compared to $0.34 per share for the same three-month period in 2007. Net income available to common stockholders for the six months ended June 30, 2008 was $1.09 per share, compared to $0.76 per share for the same six-month period in 2007. (All currency amounts discussed herein are in thousands, except share and per share amounts. All per share information is presented on a diluted basis.)

Based on the $0.31 per share dividend paid on July 31, 2008, and the August 7, 2008 closing price of $6.54, Anthracite's annualized dividend yield is 19.0%.

Chris Milner, Chief Executive Officer of the Company, stated, "After a period of relative stability in April and May, the markets suffered another major setback in June and July as continuing economic weakness combined with the challenges faced by the residential mortgage market put significant pressure on financial stocks and credit spreads. In this volatile environment, we continue to guard our liquidity and actively manage our existing portfolio of assets."

Mr. Milner also commented, "Over the last twelve months we have opportunistically deployed capital when we have identified compelling, risk-adjusted returns, primarily in non-US markets. We are beginning to see such opportunities in the US markets as pricing levels continue to decline. Another area of potential opportunity is the purchase of the Company's debt in the secondary market. Given the dramatically improved relative value in the RMBS sector, we may also begin to replenish the RMBS portfolio as a store of liquidity. Throughout this process, our focus will be to raise capital which can accrete earnings and support our dividend."

Capital Markets Activity
Common and Preferred Stock Issuances

On April 4, 2008, the Company issued $70,125 of Series E-1, E-2 and E-3 Cumulative Convertible Redeemable Preferred Stock (collectively, the "Series E Preferred Stock"), resulting in net proceeds of $69,866. Dividends are payable on the convertible preferred stock at a rate of 12% and the purchaser has the right to convert the preferred stock into common stock at $7.49 per share (a 12% premium to the closing price of the Company's common stock on March 28, 2008, the pricing date). In conjunction with the Company's issuance of the Series E Preferred Stock, the Company also issued 3,494,021 shares of Common Stock, resulting in net proceeds of $23,286. On June 20, 2008, the holder exercised its right to convert its outstanding Series E-3 Preferred Stock into 3,119,661 shares of Common Stock.

For the six months ended June 30, 2008, the Company issued an aggregate of 2,690,639 shares of Common Stock under its sales agency agreement and its Dividend Reinvestment and Stock Purchase Plan. Net proceeds to the Company were $19,928.

Credit Facilities:
On August 7, 2008, Bank of America, N.A. extended its U.S. and non-U.S. dollar denominated facilities until September 18, 2010. In connection with the extension, certain financial covenants were added or modified to conform to more restrictive covenants contained in other credit facilities and the Company is required to make amortization payments of $31,000 by September 30, 2008.

On July 8, 2008, Deutsche Bank AG, Cayman Islands Branch extended its multicurrency agreement until July 8, 2010. In connection with the extension, certain financial covenants were added or modified to conform to more restrictive covenants contained in other credit facilities. At the time of the extension, total borrowings outstanding were $110,104.

On March 7, 2008, the Company entered into a $60,000 credit facility with a subsidiary of BlackRock, Inc. BlackRock, Inc. is the parent of the Company's manager, BlackRock Financial Management, Inc. The facility is collateralized by a pledge of the Company's investment in Carbon Capital II, Inc. ("Carbon II") and gives the lender the option to purchase the Carbon II investment at fair market value (as determined by the terms of the agreement) from the Company. On April 8, 2008, the Company repaid $52,500, representing all then outstanding borrowings under the facility. On July 28, 2008, the Company reborrowed $30,000 under the facility.

Richard Shea, President and Chief Operating Officer of the Company, stated, "The Company extended the maturities of two of its secured lines of credit from 2008 to 2010. Aside from scheduled paydowns, the Company has no other borrowings with maturities in 2008 and its unfunded commitments total $1,650. We will continue to seek to raise capital in order to reduce short-term liabilities and support our existing portfolio in a way that is accretive to earnings."

Liquidity
At June 30, 2008, the Company had $38,684 of unrestricted cash and $15,807 of additional restricted cash, consisting primarily of funds inside the Euro CDO. Approximately 18% of the Company's total borrowings are subject to mark-to-market adjustments and margin calls, and the Company continues to evaluate other financing alternatives to reduce short-term borrowings. At June 30, 2008, approximately 80% of the Company's secured liabilities were not subject to margin calls. The Company's unsecured liabilities had a weighted average maturity of 18.1 years (assuming the Company's convertible senior notes are outstanding until their final maturity).

During 2008, the value of credit sensitive securities continued to fall regardless of actual credit performance. As a result, the value of the Company's assets fell and the Company's lenders issued margin calls totaling $120,619 from January 1, 2008 through August 8, 2008, $35,708 of which occurred since April 1, 2008. The Company fully funded all margin calls.

Second Quarter Financial Summary
For the quarter ended June 30, 2008, the Company recorded a loss of $(2,538) related to its investment in Carbon II. The loss is primarily the result of Carbon II establishing a loan loss reserve of $17,700, the entire face amount of the loan, during the second quarter of 2008. The Company owns 26% of Carbon II, resulting in a $4,602 decline in the Company's income.

The impact of valuing assets and liabilities under FAS 159 was a net gain of $9,964 for the three months ended June 30, 2008. Credit spreads tightened during the second quarter and the increase in the value of CMBS securities more than offset the increase in the fair value of the related liabilities.

In response to market conditions, the Company increased the loss assumptions on its Controlling Class CMBS from 1.31% of outstanding collateral at December 31, 2007 to 1.44% at March 31, 2008. This was an increase in total expected losses of approximately $97,700 over the life of the transactions and resulted in a decrease in income for the second quarter of 2008 of approximately $2,300, or $0.03 per share.

Weighted average cost of funds remained at 6.1% for the second quarter of 2008, unchanged from the first quarter of 2008.

At June 30, 2008, the Company's exposure to a 50 basis point move in U.S. libor is $0.02 per share annually.

Investment Activity
The Company will invest up to $5,000, for up to a 10% interest, in Anthracite JV LLC ("AHR JV"). AHR JV will invest in U.S. CMBS rated higher than BB. As of June 30, 2008, the Company had invested $1,137 in AHR JV.

On June 26, 2008, the Company invested $30,886 in RECP Anthracite International JV Limited ("AHR International JV"). AHR International JV will invest in fixed income investments backed by non-U.S. real estate assets. The Company will invest on a deal-by-deal basis and has no committed capital obligation. The Company is utilizing the joint venture structure to increase its capacity to invest in larger and more diverse transactions given the current market's elevated level of risk.

During the second quarter of 2008, the Company also funded an additional commercial real estate loan commitment of $2,286. Remaining outstanding funding commitments total $1,650.

Commercial Real Estate Securities
The Company considers CMBS where it maintains the right to control the foreclosure/workout process on the underlying loans as controlling class CMBS ("Controlling Class CMBS"). The Company owns Controlling Class CMBS issued in 1998, 1999 and 2001 through 2007.

The Company did not acquire any additional Controlling Class CMBS trusts during the quarter ended June 30, 2008. At June 30, 2008, the Company owned 39 Controlling Class CMBS trusts with an aggregate underlying loan principal balance of $58,356,845. Delinquencies of 30 days or more on these loans as a percent of current loan balances were 0.59% at June 30, 2008, compared with 0.62% at March 31, 2008.

The chart below summarizes the par, weighted average coupon, market value, adjusted purchase price and second quarter 2008 estimated loss assumptions for the Company's U.S. dollar denominated Controlling Class CMBS:

                                                                                            Estimated
                                 Weighted Average                         Adjusted          Collateral
Vintage             Par               Coupon          Market Value     Purchase Price         Losses
1998           $      261,276                 6.16 % $       225,340   $       217,475   $         58,033
1999                    7,604                 6.85 %           6,964             6,923              2,633
2001                   34,790                 6.08 %          29,156            26,996             13,610
2002                    2,300                 5.68 %           2,037             2,255             10,036
2003                   78,209                 4.93 %          57,259            60,784             48,328
2004                   75,445                 5.11 %          45,743            57,681            124,122
2005                  234,207                 4.97 %          90,697           141,930            110,468
2006                  421,066                 5.24 %         114,475           232,680            178,848
2007                  649,400                 5.16 %         147,655           321,423            311,550
Total          $    1,764,297                 5.32 % $       719,326   $     1,068,147   $        857,628

During the three months ended June 30, 2008, three securities in two of the Company's Controlling Class CMBS were upgraded by at least one rating agency and five securities in two Controlling Class CMBS were downgraded. Additionally, at least one rating agency upgraded five of the Company's non-Controlling Class commercial real estate securities and downgraded four.

Mr. Shea stated, "Credit performance of the Company's portfolio is consistent with expectations as Controlling Class CMBS delinquencies at quarter end were 59 basis points. Many of the credit issues in today's market are associated with loans that are maturing and cannot refinance in this very difficult environment. Outside of the CMBS portfolio, the Company has only one loan on its balance sheet with a 2008 maturity and an extension is in the process of being finalized. At quarter end, the Company's direct commercial real estate loan portfolio has only one non-performing loan, which is fully reserved, and the Company's share of Carbon Capital's five non-performing loans totals $35,577 with a current reserve of $7,052."

Commercial Real Estate Loans
At June 30, 2008, all commercial real estate loans owned directly by the Company are performing in accordance with their terms or have been reserved.

Also included in commercial real estate loans are the Company's investments in Carbon Capital, Inc. ("Carbon I") and Carbon II (collectively with Carbon I, the "Carbon Capital Funds"), which are managed by the Company's manager. For the quarters ended June 30, 2008 and 2007, the Company recorded income (loss) from the Carbon Capital Funds of $(2,566) and $3,983, respectively. Carbon II increased its investment in U.S. commercial real estate loans by funding an additional investment of $910 during the second quarter of 2008. Paydowns in Carbon Capital Funds during the second quarter totaled $3,376. As loans are repaid or sold, Carbon II has redeployed capital into acquisitions of additional loans for the portfolio. The Carbon I investment period has expired and no new portfolio additions are expected.

The Company's investments in the Carbon Capital Funds were as follows:

             June 30, 2008     December 31, 2007
Carbon I    $         1,711   $             1,636
Carbon II            95,258                97,762
            $        96,969   $            99,398

As previously reported, three loans held in the Carbon Capital Funds are in various stages of resolution and the Carbon Capital Funds have established loan loss reserves as necessary.

An additional loan in Carbon II defaulted at maturity in February 2008. The loan was restructured, modified and extended. However, Carbon II established a loan loss reserve of $17,700 during the second quarter of 2008 based upon the probability of recovery. The Company's 26% share of this reserve reduced income by $4,602.

Subsequent to June 30, 2008, one first mortgage loan in Carbon II experienced a maturity default. Carbon II is engaged in workout discussions, and various . . .