Anworth Mortgage Asset Corporation Announces Update on Subsidiary

SANTA MONICA, Calif.--(Business Wire)--Anworth Mortgage Asset Corporation ("Anworth") (NYSE:ANH)
announced today that its wholly-owned subsidiary, Belvedere Trust
Mortgage Corporation ("Belvedere"), which is being accounted for as a
discontinued operation, received a Notice of Default from Merrill,
Lynch, Pierce, Fenner & Smith Incorporated on December 13, 2007
relative to a repurchase agreement balance of approximately $3.1
million secured by non-Agency mortgage-backed securities with a
collateral value claimed to be approximately $1.1 million.

Also, on December 12, 2007, Belvedere's custodian, Citigroup
Global Markets, Inc. ("Citi"), notified Belvedere that its custody
account had a negative balance of approximately $6.5 million based on
liabilities related to certain non-Agency mortgage-backed securities
held at Citi. Belvedere believes that the custodian will make a claim
against Belvedere for payment of the negative balance. Belvedere
intends to contest such claim.

Anworth is neither a co-party to nor a guarantor of Belvedere's
repurchase agreements or claims against Belvedere.

Based on these events, Anworth believes that it will write-off the
remainder of approximately $7 million of its investment in Belvedere
during the fourth quarter ended December 31, 2007.

About Anworth Mortgage Asset Corporation

Anworth is a mortgage real estate investment trust which invests
in mortgage assets including mortgage pass-through certificates,
collateralized mortgage obligations, mortgage loans and other real
estate securities. Anworth generates income for distribution to
stockholders primarily based on the difference between the yield on
its mortgage assets and the cost of its borrowings.

Safe Harbor Statement under the Private Securities Litigation
Reform Act of 1995

This press release contains forward-looking statements within the
meaning of the "safe harbor" provisions of the Private Securities
Litigation Reform Act of 1995. These statements are based upon our
current expectations and speak only as of the date hereof. Our actual
results may differ materially and adversely from those expressed in
any forward-looking statements as a result of various factors and
uncertainties, including increases in the prepayment rates on the
mortgage loans securing our mortgage-backed securities, our ability to
use borrowings to finance our assets, risks associated with investing
in mortgage-related assets, including changes in business conditions
and the general economy, our ability to maintain our qualification as
a real estate investment trust for federal income tax purposes, and
management's ability to manage our growth. Our Annual Report on Form
10-K, Quarterly Reports on Form 10-Q, certain Current Reports on Forms
8-K, and other SEC filings discuss some of the important risk factors
that may affect our business, results of operations and financial
condition. We undertake no obligation to revise or update publicly any
forward-looking statements for any reason.

Anworth Mortgage Asset Corporation
John T. Hillman, 310-255-4438 or 310-255-4493

Copyright Business Wire 2007