we also use leverage in our non-agency strategies , albeit significantly less leverage than that used in our agency rmbs strategy . through december 31 , 2013 , we financed our asset purchases almost exclusively through reverse repurchase agreements , or `` reverse repos , `` which we account for as collateralized borrowings . in january 2012 , we completed a small resecuritization transaction using one of our non-agency rmbs assets ; this transaction is accounted for as a collateralized borrowing and is classified on our consolidated statement of assets , liabilities , and equity as `` securitized debt . `` this securitized debt represents long-term financing for the related asset , in contrast to our reverse repos collateralized by non-agency assets , which typically have 30 to 180 day terms . however , we expect to continue to obtain the vast majority of our financing through the use of reverse repos . the strategies that we employ are intended to capitalize on opportunities in the current market environment . we intend to adjust our strategies to changing market conditions by shifting our asset allocations across various asset classes as credit and liquidity trends evolve over time . we believe that this flexibility , combined with ellington 's experience , will help us generate more consistent returns on our capital throughout changing market cycles . in may 2013 , we completed a follow-on common share offering which resulted in net proceeds of $ 125.3 million , after offering costs . proceeds from the offering were fully deployed during the second quarter into our targeted assets . in the latter part of the second quarter of 2013 , we increased our level of cash holdings , both as a buffer against increased market volatility and so as to be able to take advantage of potential investment opportunities . for similar reasons , we maintained a higher level of cash holdings through the remainder of 2013. as of december 31 , 2013 , outstanding borrowings under reverse repos and securitized debt were $ 1.2 billion and our debt-to-equity ratio was 1.98 to 1. our debt-to-equity ratio does not account for liabilities other than debt financings . of our total borrowings outstanding as of december 31 , 2013 , approximately 68.1 % or $ 842.3 million relates to our agency rmbs holdings . the remaining outstanding borrowings relate to our non-agency mbs , mortgage loans , and other abs ( which we refer to collectively as our non-agency portfolio ) . we opportunistically hedge our credit risk , interest rate risk , and foreign currency risk ; however , at any point in time we may choose not to hedge all or a portion of these risks , and we will generally not hedge those risks that we believe are appropriate for us to take at such time , or that we believe would be impractical or prohibitively expensive to hedge . we believe that we have been organized and have operated so that we have qualified , and will continue to qualify , to be treated for u.s. federal income tax purposes as a partnership and not as an association or a publicly traded partnership taxable as a corporation . as of december 31 , 2013 , our diluted book value per share was $ 23.99 as compared to $ 24.38 as of december 31 , 2012 . 53 trends and recent market developments key trends and recent market developments for the u.s. mortgage market include the following : federal reserve and monetary policy— in december 2013 , the u.s. federal reserve , or the `` federal reserve , `` announced its intention to reduce , beginning in january 2014 , the pace of its asset purchases under its accommodative monetary policies ; the timing and degree of the federal reserve 's reduction in asset purchases , or `` taper , `` had been the subject of heightened market speculation since mid-2013 ; housing and mortgage market statistics— data released by s & p indices for its s & p/case-shiller home price indices for december 2013 showed that , on average , home prices had increased from december 2012 by 13.6 % for its 10-city composite and by 13.4 % for its 20-city composite , resulting in its best calendar year return since 2005 ; meanwhile , the freddie mac survey 30-year mortgage rate ended the year at 4.48 % , up 34 % from its 3.35 % level at the end of 2012 ; non-performing residential loan market— the u.s. distressed residential market has an estimated $ 600 billion of supply , representing roughly 3.3 million units , as inventories of seriously delinquent loans , foreclosures , and reo ( real estate owned ) remain elevated ; government sponsored enterprise , or `` gse , `` developments— on december 10 , 2013 , the u.s. senate confirmed mel watt as the next head of the federal housing finance agency , or `` fhfa , `` ; bank regulatory capital— recent proposed changes , if finalized , will increase regulatory capital requirements for the largest , most systemically significant u.s. banks and their holdings companies ; this could potentially alter these institutions ' appetite for various risk-taking activities , and could ultimately affect the terms and availability of our reverse repo financing ; and portfolio overview , liquidity , and valuations— non-agency mbs rallied for most of 2013 as underlying strength in housing market data continued to provide support to valuations , while agency rmbs experienced a heightened level of volatility as uncertainty and speculation around future actions of the federal reserve dominated the market . federal reserve and monetary policy in december 2013 and then again in january 2014 , the federal reserve announced reductions in its purchases of agency rmbs and u.s. treasury securities under its monthly asset purchase program . story_separator_special_tag in addition , banks will likely want to reduce the risk of their afs securities holdings , which will incentivize them to hold lower duration assets such as 15-year agency rmbs . while our access to repo financing has not been adversely affected to date , it is still possible that certain of our lending institutions could , in the future , decide to curtail their repo lending activities in response to these developments , particularly in connection with repo financing on agency rmbs , which typically provides lower profit margins . however , it is also possible that these changes will create opportunities for smaller banks and or non-bank lenders to enter the repo financing market , and in fact we continue to see smaller broker-dealers becoming more active in the agency pool repo financing market . portfolio overview , liquidity , and valuations notwithstanding the late second quarter market pullback that impacted virtually all u.s. fixed income sectors , non-agency mbs rallied for most of the year ended december 31 , 2013. continued strength in home price appreciation , which was fairly widely dispersed across the united states , provided a lift to prices of non-agency rmbs over the course of the year . improvements in borrower behavior , as measured by mortgage delinquency rates , together with a declining inventory of foreclosed homes , also provided support to non-agency rmbs valuations . finally , sales of non-agency mbs by the gses , large european banks , and liquidating cdos were generally well supported by the market over the course of the year , as healthy investor appetite from regional banks , insurance companies , and money managers helped to absorb the additional supply . however , despite the strong 2013 performance of non-agency rmbs assets , the securitization market for newly issued non-agency mortgage loans remains far from fully recovered . non-agency cmbs also performed well during 2013. new issuance of cmbs in 2013 reached $ 86 billion , a nearly 80 % increase from 2012. we continued to find attractive opportunities both in `` legacy `` cmbs ( i.e . , cmbs issued before the 2008 financial crisis ) and in the new issue market . within the new issue market , we found numerous opportunities in select `` b-pieces `` , which are the most subordinated ( and therefore highest yielding and riskiest ) tranches of cmbs . we believe these investment types are attractive complements to our other cmbs holdings , which tend to be lower yielding , but can be traded more actively . during the year ended december 31 , 2013 , we also became active in or increased our activity in certain other non-agency asset classes . for example , and as discussed above , in the fourth quarter we purchased our first pool of non-performing 57 residential mortgage loans from hud under its dasp program . we have also become more active in distressed commercial loans , which comprised $ 18.9 million , or 33.2 % , of our total cmbs and commercial mortgage loan holdings of $ 56.9 million as of december 31 , 2013. activity within the distressed commercial mortgage loan sector of our portfolio can fluctuate from period to period based on the opportunities in that sector . additionally , we continue to opportunistically acquire and trade clos , especially legacy clos . as of december 31 , 2013 , our aggregate debt and equity clo holdings comprised 5.4 % of our non-agency portfolio . throughout the year ended december 31 , 2013 , we actively traded our non-agency portfolio . our portfolio turnover during 2013 , as measured by sales excluding principal paydowns , was 73 % . as non-agency mbs rallied over the course of the year , we sold certain assets and used the proceeds to purchase what we believe to be more attractive assets , including assets purchased in connection with sales by the gses , and in connection with some of the big portfolio liquidations from large european banks . over the course of 2013 , we continued to hedge our non-agency portfolio against credit-related risks , although the instruments that we use as credit hedges have continued to migrate away from credit default swaps on abx indices and single issuer abs , and more towards other instruments that , in our view , will provide greater protection in the event of a macro-economic downturn . these hedging instruments include , among others , short positions ( through credit default swaps , or `` cds , `` ) on corporate bond indices , and short positions ( through total return swaps ) in certain publicly traded reits . throughout the year , our credit hedges were , in significant part , comprised of short positions in corporate bond indices . during the fourth quarter , corporate credit generally outperformed structured credit products , including non-agency mbs , and in anticipation of a reversal of this trend , we actually increased our corporate credit hedge position towards the end of the fourth quarter . over the course of the late second quarter and the remaining months of 2013 , the agency rmbs market was among the most volatile and poorly performing fixed income sectors , as the market anticipated a tapering by the federal reserve of purchases under its asset purchase program . `` specified `` agency rmbs pools , which are pools with prepayment protection characteristics , were particularly hard hit . as interest rates have risen over the course of the year , prepayments have declined , thereby reducing the perceived value of the prepayment protection in many specified pools . these specified pools have generally underperformed tbas , their generic counterparts . a big factor contributing to this underperformance is that the federal reserve , which is by far the largest purchaser of agency pools generally purchases tbas , not specified pools . specified pools have also suffered from reduced

liquidity and capital resources liquidity refers to our ability to meet our cash needs , including repaying our borrowings , funding and maintaining positions in mbs and other assets , making distributions in the form of dividends , and other general business needs . our short-term ( one year or less ) and long-term liquidity requirements include acquisition costs for assets we acquire , payment of our base management fee and incentive fee , compliance with margin requirements under our repurchase agreement , or `` repo , '' reverse repo , tba , and financial derivative contracts , repayment of reverse repo borrowings to the extent we are unable or unwilling to extend our reverse repos , payment of our general operating expenses , and payment of our quarterly dividend . our capital resources primarily include cash on hand , cash flow from our investments ( including monthly principal and interest payments received on our investments and proceeds from the sale of investments ) , borrowings under reverse repos , and proceeds from equity offerings . we expect that these sources of funds will be sufficient to meet our short-term and long-term liquidity needs . the following summarizes our reverse repos : reverse repurchase agreements ( in thousands ) average borrowed funds during the period borrowed funds outstanding at end of the period year ended december 31 , 2013 $ 1,162,502 $ 1,236,166 year ended december 31 , 2012 $ 836,305 $ 905,718 the following summarizes our borrowings under reverse repos by remaining maturity : replace_table_token_20_th reverse repos involving underlying investments that we sold prior to december 31 , 2013 , for settlement following december 31 , 2013 , are shown using their original maturity dates even though such reverse repos may be expected to be terminated early upon settlement of the sale of the underlying investment . not included are any reverse repos that we may have entered into prior to december 31 , 2013 for which delivery of the borrowed funds is not scheduled until after december 31 , 73 2013 . our reverse repo agreements are subject to the application of `` haircuts . ''


 Write a concise suspicious activity report of the following text delimited by triple backquotes. Return your response as a formal report which covers the key points highlighting the location,dates,entity names and account holder information in chronological order of the text.
     ```liquidity and capital resources liquidity refers to our ability to meet our cash needs , including repaying our borrowings , funding and maintaining positions in mbs and other assets , making distributions in the form of dividends , and other general business needs . our short-term ( one year or less ) and long-term liquidity requirements include acquisition costs for assets we acquire , payment of our base management fee and incentive fee , compliance with margin requirements under our repurchase agreement , or `` repo , '' reverse repo , tba , and financial derivative contracts , repayment of reverse repo borrowings to the extent we are unable or unwilling to extend our reverse repos , payment of our general operating expenses , and payment of our quarterly dividend . our capital resources primarily include cash on hand , cash flow from our investments ( including monthly principal and interest payments received on our investments and proceeds from the sale of investments ) , borrowings under reverse repos , and proceeds from equity offerings . we expect that these sources of funds will be sufficient to meet our short-term and long-term liquidity needs . the following summarizes our reverse repos : reverse repurchase agreements ( in thousands ) average borrowed funds during the period borrowed funds outstanding at end of the period year ended december 31 , 2013 $ 1,162,502 $ 1,236,166 year ended december 31 , 2012 $ 836,305 $ 905,718 the following summarizes our borrowings under reverse repos by remaining maturity : replace_table_token_20_th reverse repos involving underlying investments that we sold prior to december 31 , 2013 , for settlement following december 31 , 2013 , are shown using their original maturity dates even though such reverse repos may be expected to be terminated early upon settlement of the sale of the underlying investment . not included are any reverse repos that we may have entered into prior to december 31 , 2013 for which delivery of the borrowed funds is not scheduled until after december 31 , 73 2013 . our reverse repo agreements are subject to the application of `` haircuts . ''
```    
 Suspicious Activity Report : we also use leverage in our non-agency strategies , albeit significantly less leverage than that used in our agency rmbs strategy . through december 31 , 2013 , we financed our asset purchases almost exclusively through reverse repurchase agreements , or `` reverse repos , `` which we account for as collateralized borrowings . in january 2012 , we completed a small resecuritization transaction using one of our non-agency rmbs assets ; this transaction is accounted for as a collateralized borrowing and is classified on our consolidated statement of assets , liabilities , and equity as `` securitized debt . `` this securitized debt represents long-term financing for the related asset , in contrast to our reverse repos collateralized by non-agency assets , which typically have 30 to 180 day terms . however , we expect to continue to obtain the vast majority of our financing through the use of reverse repos . the strategies that we employ are intended to capitalize on opportunities in the current market environment . we intend to adjust our strategies to changing market conditions by shifting our asset allocations across various asset classes as credit and liquidity trends evolve over time . we believe that this flexibility , combined with ellington 's experience , will help us generate more consistent returns on our capital throughout changing market cycles . in may 2013 , we completed a follow-on common share offering which resulted in net proceeds of $ 125.3 million , after offering costs . proceeds from the offering were fully deployed during the second quarter into our targeted assets . in the latter part of the second quarter of 2013 , we increased our level of cash holdings , both as a buffer against increased market volatility and so as to be able to take advantage of potential investment opportunities . for similar reasons , we maintained a higher level of cash holdings through the remainder of 2013. as of december 31 , 2013 , outstanding borrowings under reverse repos and securitized debt were $ 1.2 billion and our debt-to-equity ratio was 1.98 to 1. our debt-to-equity ratio does not account for liabilities other than debt financings . of our total borrowings outstanding as of december 31 , 2013 , approximately 68.1 % or $ 842.3 million relates to our agency rmbs holdings . the remaining outstanding borrowings relate to our non-agency mbs , mortgage loans , and other abs ( which we refer to collectively as our non-agency portfolio ) . we opportunistically hedge our credit risk , interest rate risk , and foreign currency risk ; however , at any point in time we may choose not to hedge all or a portion of these risks , and we will generally not hedge those risks that we believe are appropriate for us to take at such time , or that we believe would be impractical or prohibitively expensive to hedge . we believe that we have been organized and have operated so that we have qualified , and will continue to qualify , to be treated for u.s. federal income tax purposes as a partnership and not as an association or a publicly traded partnership taxable as a corporation . as of december 31 , 2013 , our diluted book value per share was $ 23.99 as compared to $ 24.38 as of december 31 , 2012 . 53 trends and recent market developments key trends and recent market developments for the u.s. mortgage market include the following : federal reserve and monetary policy— in december 2013 , the u.s. federal reserve , or the `` federal reserve , `` announced its intention to reduce , beginning in january 2014 , the pace of its asset purchases under its accommodative monetary policies ; the timing and degree of the federal reserve 's reduction in asset purchases , or `` taper , `` had been the subject of heightened market speculation since mid-2013 ; housing and mortgage market statistics— data released by s & p indices for its s & p/case-shiller home price indices for december 2013 showed that , on average , home prices had increased from december 2012 by 13.6 % for its 10-city composite and by 13.4 % for its 20-city composite , resulting in its best calendar year return since 2005 ; meanwhile , the freddie mac survey 30-year mortgage rate ended the year at 4.48 % , up 34 % from its 3.35 % level at the end of 2012 ; non-performing residential loan market— the u.s. distressed residential market has an estimated $ 600 billion of supply , representing roughly 3.3 million units , as inventories of seriously delinquent loans , foreclosures , and reo ( real estate owned ) remain elevated ; government sponsored enterprise , or `` gse , `` developments— on december 10 , 2013 , the u.s. senate confirmed mel watt as the next head of the federal housing finance agency , or `` fhfa , `` ; bank regulatory capital— recent proposed changes , if finalized , will increase regulatory capital requirements for the largest , most systemically significant u.s. banks and their holdings companies ; this could potentially alter these institutions ' appetite for various risk-taking activities , and could ultimately affect the terms and availability of our reverse repo financing ; and portfolio overview , liquidity , and valuations— non-agency mbs rallied for most of 2013 as underlying strength in housing market data continued to provide support to valuations , while agency rmbs experienced a heightened level of volatility as uncertainty and speculation around future actions of the federal reserve dominated the market . federal reserve and monetary policy in december 2013 and then again in january 2014 , the federal reserve announced reductions in its purchases of agency rmbs and u.s. treasury securities under its monthly asset purchase program . story_separator_special_tag in addition , banks will likely want to reduce the risk of their afs securities holdings , which will incentivize them to hold lower duration assets such as 15-year agency rmbs . while our access to repo financing has not been adversely affected to date , it is still possible that certain of our lending institutions could , in the future , decide to curtail their repo lending activities in response to these developments , particularly in connection with repo financing on agency rmbs , which typically provides lower profit margins . however , it is also possible that these changes will create opportunities for smaller banks and or non-bank lenders to enter the repo financing market , and in fact we continue to see smaller broker-dealers becoming more active in the agency pool repo financing market . portfolio overview , liquidity , and valuations notwithstanding the late second quarter market pullback that impacted virtually all u.s. fixed income sectors , non-agency mbs rallied for most of the year ended december 31 , 2013. continued strength in home price appreciation , which was fairly widely dispersed across the united states , provided a lift to prices of non-agency rmbs over the course of the year . improvements in borrower behavior , as measured by mortgage delinquency rates , together with a declining inventory of foreclosed homes , also provided support to non-agency rmbs valuations . finally , sales of non-agency mbs by the gses , large european banks , and liquidating cdos were generally well supported by the market over the course of the year , as healthy investor appetite from regional banks , insurance companies , and money managers helped to absorb the additional supply . however , despite the strong 2013 performance of non-agency rmbs assets , the securitization market for newly issued non-agency mortgage loans remains far from fully recovered . non-agency cmbs also performed well during 2013. new issuance of cmbs in 2013 reached $ 86 billion , a nearly 80 % increase from 2012. we continued to find attractive opportunities both in `` legacy `` cmbs ( i.e . , cmbs issued before the 2008 financial crisis ) and in the new issue market . within the new issue market , we found numerous opportunities in select `` b-pieces `` , which are the most subordinated ( and therefore highest yielding and riskiest ) tranches of cmbs . we believe these investment types are attractive complements to our other cmbs holdings , which tend to be lower yielding , but can be traded more actively . during the year ended december 31 , 2013 , we also became active in or increased our activity in certain other non-agency asset classes . for example , and as discussed above , in the fourth quarter we purchased our first pool of non-performing 57 residential mortgage loans from hud under its dasp program . we have also become more active in distressed commercial loans , which comprised $ 18.9 million , or 33.2 % , of our total cmbs and commercial mortgage loan holdings of $ 56.9 million as of december 31 , 2013. activity within the distressed commercial mortgage loan sector of our portfolio can fluctuate from period to period based on the opportunities in that sector . additionally , we continue to opportunistically acquire and trade clos , especially legacy clos . as of december 31 , 2013 , our aggregate debt and equity clo holdings comprised 5.4 % of our non-agency portfolio . throughout the year ended december 31 , 2013 , we actively traded our non-agency portfolio . our portfolio turnover during 2013 , as measured by sales excluding principal paydowns , was 73 % . as non-agency mbs rallied over the course of the year , we sold certain assets and used the proceeds to purchase what we believe to be more attractive assets , including assets purchased in connection with sales by the gses , and in connection with some of the big portfolio liquidations from large european banks . over the course of 2013 , we continued to hedge our non-agency portfolio against credit-related risks , although the instruments that we use as credit hedges have continued to migrate away from credit default swaps on abx indices and single issuer abs , and more towards other instruments that , in our view , will provide greater protection in the event of a macro-economic downturn . these hedging instruments include , among others , short positions ( through credit default swaps , or `` cds , `` ) on corporate bond indices , and short positions ( through total return swaps ) in certain publicly traded reits . throughout the year , our credit hedges were , in significant part , comprised of short positions in corporate bond indices . during the fourth quarter , corporate credit generally outperformed structured credit products , including non-agency mbs , and in anticipation of a reversal of this trend , we actually increased our corporate credit hedge position towards the end of the fourth quarter . over the course of the late second quarter and the remaining months of 2013 , the agency rmbs market was among the most volatile and poorly performing fixed income sectors , as the market anticipated a tapering by the federal reserve of purchases under its asset purchase program . `` specified `` agency rmbs pools , which are pools with prepayment protection characteristics , were particularly hard hit . as interest rates have risen over the course of the year , prepayments have declined , thereby reducing the perceived value of the prepayment protection in many specified pools . these specified pools have generally underperformed tbas , their generic counterparts . a big factor contributing to this underperformance is that the federal reserve , which is by far the largest purchaser of agency pools generally purchases tbas , not specified pools . specified pools have also suffered from reduced

