EXHIBIT 10.3

ASSIGNMENT AND ASSUMPTION AGREEMENT

THIS ASSIGNMENT AND ASSUMPTION AGREEMENT (this “ Agreement ”) is dated as of May 20, 2009, and is by and between FBR CAPITAL MARKETS CORPORATION, a corporation organized under the laws of the Commonwealth of Virginia (“ CMC ”), and FRIEDMAN, BILLINGS, RAMSEY GROUP, INC. (d/b/a ARLINGTON ASSET INVESTMENT CORP.), a corporation organized under the laws of the Commonwealth of Virginia (“ Group ”). CMC and Group are sometimes referred to herein individually as a “ Party ” and collectively as the “ Parties .”

RECITALS

WHEREAS, pursuant to that certain Stock Repurchase Agreement, dated as of May 18, 2009, by and between CMC, FBR TRS Holdings, Inc. (“ FBR TRS ”), and Group (the “ Repurchase Agreement ”), CMC has agreed to repurchase certain shares of capital stock of CMC that are currently held of record by FBR TRS and beneficially owned by Group; and

WHEREAS, in connection with the entering into of the Repurchase Agreement, Group desires to assign to CMC, and CMC desires to accept and receive from Group, all of Group’s contract rights under certain agreements to which it is a party all upon the terms and subject to the conditions set forth in this Agreement.

NOW, THEREFORE, in consideration of the premises and the mutual covenants and agreements set forth herein, and for other good and valuable consideration, the receipt and sufficiency of which are hereby acknowledged, the Parties hereby agree as follows:

AGREEMENT

Section 1.     Assignment and Assumption . Group hereby assigns, sells, transfers and conveys each applicable Assigned Contract (as hereinafter defined) (with such assignment, sale, transfer and conveyance deemed to have been effective as of the original date of each applicable Assigned Contract) (the “ Assignment ”) to CMC and all of the rights, title and interest of Group in and to, and all of Group’s obligations in connection with, each of the agreements identified on Exhibit A hereto (together with any agreements identified in accordance with the terms of Section 2 , the “ Assigned Contracts ”). CMC hereby accepts the Assignment and assumes and agrees (with such assumption and agreement deemed to have been effective as of the original date of each applicable Assigned Contract) to perform all of the duties and obligations of Group under the Assigned Contracts; provided , however , that notwithstanding the foregoing, Group shall retain all responsibility for, and CMC shall have no obligation or liabilities with respect to, any such contracts to the extent that such contracts pertain solely to Group separate and apart from CMC or any subsidiary thereof.

Section 2.     Additional Agreements . The Parties agree that in the event that Group or CMC later identifies any agreement to which Group is a party that the Parties mutually agree in good faith relates at such time, previously related, or will relate primarily to CMC’s business,

Group will assign such agreement to CMC and CMC will assume Group’s duties and obligations thereunder, subject to the proviso in Section 1 .

Section 3.     Approvals and Consents; Further Actions .

(a) In the event an Assigned Contract and any claim, right, benefit, duty or obligation arising thereunder or resulting therefrom is not assignable or assumable without the consent of the other party(ies) thereto, the Parties will use commercially reasonable efforts to obtain as expeditiously as possible the