Investors
Resource Capital Corp. Reports Results for Third Quarter 2006

NEW YORK--(BUSINESS WIRE)--Nov. 6, 2006--Resource Capital Corp. (NYSE: RSO) (the "Company" or "RCC"), a real estate investment trust focused on originating and investing in commercial real estate secured loans, whole loans, B-notes, mezzanine loans, mortgage-related securities and other real estate related assets and, to a lesser extent, higher-yielding commercial finance assets and asset-backed securities, reported estimated REIT taxable income of $9.2 million or $0.52 per diluted share for the quarter ended September 30, 2006, as compared to $4.6 million or $0.30 per diluted share for the quarter ended September 30, 2005 an increase of $4.6 million (101%) and $0.22 (73%) per diluted share, respectively. A reconciliation of estimated REIT taxable income to the Company's GAAP net income accompanies this release. As previously reported, on September 28, 2006 the Company sold the remainder of its agency residential mortgage backed securities ("RMBS") portfolio and terminated the related interest rate swap contract in order to redeploy its invested capital into higher earning asset classes. Consequently, included in the Company's operating results for the quarter ended and nine months ended September 30, 2006 is a net loss of $8.3 million and $8.8 million, respectively, incurred as a result of this sale.

Including this transaction, the Company reported a net loss of $2.4 million or ($0.14) per diluted share for the quarter ended September 30, 2006 as compared to net income of $3.8 million or $0.24 per diluted share for the quarter ended September 30, 2005 a decrease of $6.2 million (164%) and $0.38 (158%) per diluted share, respectively. Net income for the nine months ended September 30, 2006 was $8.8 million, or $0.51 per diluted share, as compared to net income for the period ended September 30, 2005 of $6.0 million, or $0.39 per diluted share, an increase of $2.8 million (47%) and $0.12 (31%) per diluted share, respectively.

Pro-forma net income from on-going operations excludes the net realized loss from the agency RMBS sale. Pro-forma net income from on-going operations was $5.9 million for the quarter ended September 30, 2006 as compared to $3.8 million for the quarter ended September 30, 2005, an increase of $2.1 million. Pro-forma net income was $17.6 million for the nine month period ended September 30, 2006 as compared to $6.0 million for the period ended September 30, 2005 an increase of $11.6 million. The following table reconciles net income to pro-forma income from on-going operations for all periods:

                                            Nine Months
                      Three Months Ended       Ended     Period Ended
                         September 30,     September 30, September 30,
                      -------------------- ------------- -------------
                         2006       2005       2006          2005
                      ------------ ------- ------------- -------------
                      (unaudited, in thousands, except per share data)

Net (loss) income     $    (2,401) $3,776  $      8,814  $      6,008
Plus:
  Net realized loss
   from sale of
   Agency RMBS
   portfolio                8,301       -         8,768             -
                      ------------ ------- ------------- -------------

Pro-forma income from
 on-going operations  $     5,900  $3,776  $     17,582  $      6,008
                      ============ ======= ============= =============
Pro-forma income from
 on-going operations
 per share diluted
 (1)                  $      0.33  $ 0.24  $       1.01  $       0.39
                      ============ ======= ============= =============

(1) For the three months ended September 30, 2006, the weighted
 average number of shares used in calculating the net loss per share-
 diluted is the same as the basic weighted average number of shares as
 a result of a net loss available to common shareholders for the
 period. Diluted shares used in the pro-forma per share-diluted
 computation are 17,720,590.

Pro-forma income from on-going operations is not a measure of financial performance under GAAP and accordingly, should not be considered as a substitute for net (loss) income.

    Highlights for the third quarter and recent developments include:

    --  The Company paid a quarterly dividend of $0.37 per common
        share for the third quarter of 2006, an increase of $0.01 per
        common share or 3% from the dividend paid for the second
        quarter of 2006. This distribution was paid on October 13,
        2006 to all shareholders of record as of September 29, 2006.

    --  The Company's net interest income increased by $2.3 million or
        (38%) to $8.3 million for the quarter ended September 30, 2006
        as compared to $6.0 million for the same period in 2005.

    Commercial Real Estate

    --  The Company continued to increase its investment in commercial
        real estate loans. The portfolio of loans (net of repayments)
        grew by $147.1 million to $439.7 million at September 30, 2006
        from $292.6 million at June 30, 2006. As of November 3, 2006,
        the Company had closed an additional $53.4 million of loans
        and is currently in the closing process for seven additional
        commercial real estate investment opportunities in excess of
        $147.0 million. In addition, RCC received a repayment in July
        2006 on one loan of $27.5 million.

    --  On July 3, 2006, the Company added a direct loan origination
        team based in Los Angeles, led by Kyle Geoghegan and Darryl
        Myrose.

    --  On August 10, 2006, the Company closed Resource Real Estate
        Funding CDO 2006-1, Ltd. ("RREF CDO-1") a collateralized debt
        obligation ("CDO"), that will provide long-term financing for
        a $345.0 million portfolio of commercial real estate loans.
        The Company retained approximately $79.4 million of equity in
        this financing. The notes issued by RREF CDO-1 bear interest
        at a weighted-average interest rate of LIBOR plus 0.82%. At
        September 30, 2006, the weighted average rate on all notes was
        6.13%.

    --  On August 11, 2006, the Company closed on a new $300.0 million
        repurchase agreement facility with Column Financial, Inc., a
        subsidiary of Credit Suisse Securities (USA) LLC, to finance
        the purchase of commercial real estate loans. At September 30,
        2006, the Company had borrowed $43.0 million under the
        facility with a weighted average interest rate of LIBOR plus
        1.17% (6.50% at September 30, 2006).

    Commercial Finance

    --  RCC continued to increase the size of its bank loan portfolio
        and ended the quarter with a total of $614.9 million of these
        loans, at cost, with a weighted-average spread of LIBOR plus
        2.36% and a fair value of $613.9 million. The Company's loan
        portfolio is match-funded through two CDO's with a
        weighted-average cost of LIBOR plus 0.45%.

    --  RCC's commercial finance subsidiary acquired an additional
        $68.6 million in direct financing leases and notes, net of
        sales and principal paydowns, since December 31, 2005,
        including $13.9 million since June 30, 2006.

    Corporate Matters

    --  The Company issued a $25.8 unsecured junior subordinated
        debenture that bears interest at LIBOR plus 3.95% related to a
        trust preferred security ("Trups") on September 29, 2006. RCC
        received net proceeds of $24.2 million from the issuance.

    Balance Sheet Summary

At September 30, 2006, excluding the Company's Agency RMBS portfolio, RCC's investment portfolio totaled $1.6 billion and included the following: $467.0 million of commercial real estate-related investments, $368.5 million of asset backed securities, $614.9 million of bank loans, $91.9 million of direct financing leases and notes and $42.6 million of temporary cash investments. At September 30, 2006, RCC's investment portfolio (excluding the financing related to the Company's agency RMBS portfolio) was financed with $1.4 billion of total indebtedness and included the following: $1.2 billion of senior notes issued by CDOs secured primarily by commercial real estate related investments, mortgage-backed securities, syndicated bank loans and other asset-backed securities; $87.1 million outstanding under a term facility secured by equipment leases and notes and $51.5 million of unsecured junior subordinated debentures. The Agency RMBS repurchase agreement debt of $716.5 million was paid down on October 2, 2006 upon settlement of the trade and receipt of proceeds from the broker.

Book Value

The Company's book value per common share at September 30, 2006 was $12.91 as compared to $12.46 at December 31, 2005, a 3.6% increase. Total stockholders' equity was $230.0 million at September 30, 2006 and $195.3 million at December 31, 2005. Total common shares outstanding were 17,821,434 and 15,682,334 at September 30, 2006 and December 31, 2005, respectively.

Investment Portfolio

The table below summarizes the amortized cost and estimated fair value of RCC's investment portfolio as of September 30, 2006, classified by interest rate type. The table below includes both (i) the amortized cost of RCC's investment portfolio and the related dollar price, which is computed by dividing amortized cost by par amount, and (ii) the estimated fair value of RCC's investment portfolio and the related dollar price, which is computed by dividing the estimated fair value by par amount (in thousands, except percentages):

                                September 30, 2006
             ---------------------------------------------------------
                                                     Estimated
                                                        fair
                                                       value
                                                        less
             Amortized   Dollar  Estimated   Dollar   amortized Dollar
                 cost     price   fair value  price     cost     price
             ----------- ------- ----------- ------- ---------- ------
 Floating
    rate
------------
Non-agency
 RMBS        $  340,988   99.19% $  341,225   99.26% $     236   0.07%
CMBS                415  100.00%        420  101.20%         5   1.20%
Other ABS        18,317   98.95%     18,419   99.50%       103   0.55%
Whole loans      75,821   99.19%     75,821   99.19%         -   0.00%
A notes          42,517  100.04%     42,517  100.04%         -   0.00%
B notes         120,251   99.98%    120,251   99.98%         -   0.00%
Mezzanine
 loans           78,631   99.97%     78,631   99.97%         -   0.00%
Syndicated
 bank loans     614,699  100.16%    613,636   99.98%    (1,063) -0.18%
             -----------         -----------         ----------
  Total
   floating
   rate      $1,291,639   99.80% $1,290,920   99.74% $    (719) -0.06%
             ===========         ===========         ==========
 Fixed rate
------------
Non-agency
 RMBS        $    6,000  100.00% $    5,853   97.55% $    (147) -2.45%
CMBS             27,539   98.73%     26,968   96.68%      (571) -2.05%
Other ABS         3,135   99.97%      2,999   95.63%      (136) -4.34%
B notes          41,920   99.81%     41,920   99.81%         -   0.00%
Mezzanine
 loans           80,515   93.52%     80,515   93.52%         -   0.00%
Syndicated
 bank loans         248   99.60%        248   99.60%         -   0.00%
Equipment
 leases and
 notes           91,909  100.00%     91,909  100.00%         -   0.00%
             -----------         -----------         ----------
  Total
   fixed
   rate      $  251,266   97.66% $  250,412   97.33% $    (854) -0.33%
             ===========         ===========         ----------
  Grand
   total     $1,542,905   99.44% $1,541,332   99.34% $  (1,573) -0.10%
             ===========         ===========         ==========

About Resource Capital Corp.

Resource Capital Corp. is a specialty finance company that began operations in March 2005 and has elected and intends to continue to qualify as a real estate investment trust for federal income tax purposes. RCC's investment strategy focuses on real estate-related assets, and, to a lesser extent, higher-yielding commercial finance assets with a concentration on the following asset classes: commercial real estate-related assets such as whole loans, B-notes, mezzanine loans and mortgage-related securities and commercial finance assets such as other asset-backed securities, syndicated bank loans, equipment leases and notes, trust preferred securities and private equity investments principally issued by financial institutions. RCC is externally managed by Resource Capital Manager, Inc., an indirect wholly owned subsidiary of Resource America, Inc. (Nasdaq: REXI), a specialized asset management company that uses industry specific expertise to generate and administer investment opportunities for its own account and for outside investors in the financial fund management, real estate, and equipment finance sectors. As of June 30, 2006, Resource America, Inc. managed approximately $10.5 billion of assets in these sectors.

For more information, please visit our website at www.resourcecapitalcorp.com or contact investors relations at pschreiber@resourceamerica.com

Safe Harbor Statement

Statements made in this release include forward-looking statements, which involve substantial risks and uncertainties. The Company's actual results, performance or achievements could differ materially from those expressed or implied in this release. For information pertaining to risks related to these forward-looking statements, see Item 1A, under the caption "Risk Factors" contained in Item 1 of the Company's Annual Report on Form 10-K.

The remainder of this release contains the Company's consolidated balance sheets, consolidated statements of operations and a reconciliation of the Company's estimated REIT taxable income.

               RESOURCE CAPITAL CORP. AND SUBSIDIARIES
                     CONSOLIDATED BALANCE SHEETS
           (in thousands, except share and per share data)

                                            September 30, December 31,
                                                2006          2005
                                            ------------- ------------
                                             (Unaudited)
ASSETS
  Cash and cash equivalents                 $     13,505  $    17,729
  Restricted cash                                 29,054       23,592
  Due from broker                                753,195          525
  Available-for-sale securities, pledged as
   collateral, at fair value                     395,884    1,362,392
  Available-for-sale securities, at fair
   value                                               -       28,285
  Loans                                        1,054,602      569,873
  Direct financing leases and notes, net of
   unearned income                                91,909       23,317
  Investments in unconsolidated trusts             1,548            -
  Derivatives, at fair value                           -        3,006
  Interest receivable                             11,369        9,337
  Accounts receivable                                503          183
  Principal paydown receivables                   14,668        5,805
  Other assets                                     3,142        1,503
                                            ------------- ------------
Total assets                                $  2,369,379  $ 2,045,547
                                            ============= ============
LIABILITIES
  Repurchase agreements, including accrued
   interest of $1,012 and $2,104            $    770,167  $ 1,068,277
  Collateralized debt obligations ("CDOs")
   (net of debt issuance costs of $18,730
   and $10,093)                                1,206,751      687,407
  Warehouse agreement                                  -       62,961
  Secured term facility                           87,080            -
  Unsecured revolving credit facility                  -       15,000
  Distribution payable                             6,594        5,646
  Accrued interest expense                        11,357        9,514
  Unsecured junior subordinated debentures
   held by unconsolidated trusts that issued
   trust preferred securities                     51,548            -
  Management and incentive fee payable -
   related party                                     614          896
  Derivatives, at fair value                       3,094            -
  Security deposits                                  868            -
  Accounts payable and accrued liabilities         1,319          513
                                            ------------- ------------
Total liabilities                              2,139,392    1,850,214
                                            ------------- ------------
STOCKHOLDERS' EQUITY
  Preferred stock, par value $0.001:
   100,000,000 shares authorized; no shares
   issued and outstanding                              -            -
  Common stock, par value $0.001:
   500,000,000 shares authorized; 17,821,434
   and 15,682,334 shares issued and
   outstanding (including 234,224 and
   349,000 restricted shares)                         18           16
  Additional paid-in capital                     247,934      220,161
  Deferred equity compensation                    (1,364)      (2,684)
  Accumulated other comprehensive loss            (3,951)     (19,581)
  Distributions in excess of earnings            (12,650)      (2,579)
                                            ------------- ------------
Total stockholders' equity                       229,987      195,333
                                            ------------- ------------
TOTAL LIABILITIES AND STOCKHOLDERS' EQUITY  $  2,369,379  $ 2,045,547
                                            ============= ============
               RESOURCE CAPITAL CORP. AND SUBSIDIARIES
                CONSOLIDATED STATEMENTS OF OPERATIONS
           (in thousands, except share and per share data)
                             (Unaudited)

                                                          Period from
                                                           March 8,
                                                              2005
                                                             (Date
                                                           Operations
                                             Nine Months   Commenced)
                                                 Ended         to
                      Three Months Ended      September    September
                         September 30,            30,          30,
                   -------------------------
                      2006         2005         2006         2005
                   ------------ ------------ ------------ ------------
REVENUES
  Net interest
   income:
  Interest income
   from securities
   available-for-
   sale            $    16,248  $    16,248  $    48,673  $    26,741
  Interest income
   from loans           19,905        4,864       46,625        6,322
  Interest income
   - other               2,995          484        8,179        1,627
                   ------------ ------------ ------------ ------------
    Total interest
     income             39,148       21,596      103,477       34,690
  Interest expense      30,855       15,595       78,576       23,736
                   ------------ ------------ ------------ ------------
    Net interest
     income              8,293        6,001       24,901       10,954
                   ------------ ------------ ------------ ------------

OTHER REVENUE
  Net realized
   (losses) gains
   on investments       (8,314)         192       (8,853)         178
  Other income             384            -          391            -
                   ------------ ------------ ------------ ------------
    Total other
     revenue            (7,930)         192       (8,462)         178
                   ------------ ------------ ------------ ------------

EXPENSES
  Management fees
   - related party         917          822        3,147        1,839
  Equity
   compensation -
   related party           798          836        1,620        1,873
  Professional
   services                480          222        1,266          344
  Insurance                126          122          372          273
  General and
   administrative          443          415        1,220          795
                   ------------ ------------ ------------ ------------
    Total expenses       2,764        2,417        7,625        5,124
                   ------------ ------------ ------------ ------------
NET (LOSS) INCOME  $    (2,401) $     3,776  $     8,814  $     6,008
                   ============ ============ ============ ============

NET (LOSS) INCOME
 PER SHARE - BASIC $     (0.14) $      0.25  $      0.51  $      0.39
                   ============ ============ ============ ============

NET (LOSS) INCOME
 PER SHARE -
 DILUTED           $     (0.14) $      0.24  $      0.51  $      0.39
                   ============ ============ ============ ============

WEIGHTED AVERAGE
 NUMBER OF SHARES
 OUTSTANDING -
 BASIC              17,585,171   15,333,334   17,261,091   15,333,334
                   ============ ============ ============ ============

WEIGHTED AVERAGE
 NUMBER OF SHARES
 OUTSTANDING -
 DILUTED            17,585,171   15,458,133   17,388,566   15,458,133
                   ============ ============ ============ ============

DIVIDENDS DECLARED
 PER SHARE         $      0.37  $      0.20  $      1.06  $      0.20
                   ============ ============ ============ ============
               RESOURCE CAPITAL CORP. AND SUBSIDIARIES
 RECONCILIATION OF GAAP NET INCOME (LOSS) TO ESTIMATED REIT TAXABLE
                                INCOME
                             (Unaudited)

Estimated REIT Taxable Income

The Company calculates estimated REIT taxable income, which is a non-
 GAAP financial measure, according to the requirements of the Internal
 Revenue Code. The following table reconciles its net income to
 estimated REIT taxable income for the periods presented (in
 thousands):

                   Three Months Ended  Nine Months Ended Period Ended
                      September 30,      September 30,   September 30,
                   -------------------
                      2006      2005         2006            2005
                   ----------- ------- ----------------- -------------
Net (loss) income  $   (2,401) $3,776  $          8,814  $      6,008
Additions:
  Share-based
   compensation to
   related parties        798     836             1,620         1,873
  Incentive
   management fee
   expense to
   related party
   paid in shares           -       -               108             -
  Capital losses
   from the sale
   of available-
   for- sale
   securities          10,875       -            12,286             -
  Accrued and/or
   prepaid
   expenses                 -       -                89             -
  Net book to tax
   adjustment for
   the inclusion
   of the
   Company's
   taxable foreign
   REIT
   subsidiaries            (1)     20               764            20
  Amortization of
   Deferred Debt
   Issuance Costs
   on CDO
   financings             (48)    (40)             (140)          (40)
                   ----------- ------- ----------------- -------------
Estimated REIT
 taxable income    $    9,223  $4,592  $         23,541  $      7,861
                   =========== ======= ================= =============

The Company believes that a presentation of estimated REIT taxable income provides useful information to investors regarding its financial condition and results of operations as this measurement is used to determine the amount of dividends that RCC is required to declare to our stockholders in order to maintain its status as a REIT for federal income tax purposes. Since RCC, as a REIT, expects to make distributions based on taxable earnings, RCC expects that its distributions may at times be more or less than its reported earnings. Total taxable income is the aggregate amount of taxable income generated by RCC and by its domestic and foreign taxable REIT subsidiaries. Estimated REIT taxable income excludes the undistributed taxable income of RCC's domestic taxable REIT subsidiary, if any such income exists, which is not included in REIT taxable income until distributed by RCC. There is no requirement that RCC's domestic taxable REIT subsidiary distribute its earnings to the Company. Estimated REIT taxable income, however, includes the taxable income of RCC's foreign taxable REIT subsidiaries because the Company will generally be required to recognize and report its taxable income on a current basis. RCC uses estimated REIT taxable income for this purpose. Because not all companies use identical calculations, this presentation of estimated REIT taxable income may not be comparable to other similarly-titled measures of other companies.

CONTACT: Resource Capital Corp.
David J. Bryant, 215-546-5005
Fax: 215-546-5388

SOURCE: Resource Capital Corp.