FICC Fieldstone Investment Corp (MM)

COLUMBIA, Md., June 16 /PRNewswire-FirstCall/ -- Fieldstone Investment Corporation (NASDAQ:FICC) announced today that its Board of Directors has declared a quarterly cash dividend of $0.44 per share for the quarter ended June 30, 2006. The dividend will be paid on July 31, 2006 to stockholders of record at the close of business on June 30, 2006. The common stock will begin trading ex-dividend on June 28, 2006. Dividend Guidance Fieldstone today also announced that it has revised its dividend guidance for common stockholders during the year 2006 to between $1.60 and $1.80 per share, down from the previously announced $1.84 to $2.04 per share. The revised dividend guidance is based on management's current estimates and forecasts for the fiscal year 2006, including, but not limited to, the following: * Total annual non-conforming mortgage loan fundings of between $5.0 billion and $6.0 billion. * Investment portfolio balance of $6.0 billion of non-conforming loans by year end 2006, which reflects an estimated portfolio debt to equity leverage ratio of approximately 13 to 1. * Average net interest spread on new loans added to the investment portfolio of 2.90% during the second half of 2006, which is the difference between the average interest rate of new loans over the two year swap rate. * Weighted average diluted common shares outstanding of 47.0 million, which reflects repurchases to date under Fieldstone's Stock Repurchase Plan. As of June 1, 2006, the total number of shares of common stock outstanding was 46,904,485. If the factors described above or other factors, including foreclosure rates, loss severity rates and prepayment rates on the investment portfolio, used in management's dividend guidance differ from management's estimates, Fieldstone's 2006 dividends could be significantly affected. This revision to the Company's dividend guidance is primarily due to (i) a decline in forecast prepayment fee income for 2006 and (ii) reduced net interest margin on new loans held for investment. Michael J. Sonnenfeld, Fieldstone's President and Chief Executive Officer, stated, "This change to our dividend and our dividend guidance reflects the current market conditions: stable originations in a competitive market and the impact of slowing home price appreciation on prepayments and prepayment fees. Fieldstone has continued to focus on building its origination franchise, lowering its cost to originate and managing its investment portfolio for quality of assets and income." About Fieldstone Investment Corporation Fieldstone Investment Corporation owns and manages a portfolio of non- conforming mortgage loans originated primarily by its mortgage origination subsidiary, Fieldstone Mortgage Company, and has elected to be a real estate investment trust for federal income tax purposes. Founded in 1995, Fieldstone Mortgage Company is a nationwide residential mortgage banking company that originates non-conforming and conforming residential mortgage loans through over 4,300 independent mortgage brokers serviced by regional wholesale operations centers and a network of retail branch offices located throughout the country. Fieldstone is headquartered in Columbia, Maryland. Information Regarding Forward-Looking Statements Certain matters discussed in this press release may constitute "forward- looking statements" within the meaning of the federal securities laws. Such forward-looking statements include management's guidance on dividends, which is based on current estimates and forecasts for 2006 for, among other items, total non-conforming mortgage loan fundings, investment portfolio balance and leverage, average net spread on new loans, weighted average diluted common shares outstanding, foreclosure rates, loss severity rates and prepayment rates, changes to which could cause dividend guidance to be significantly affected. These statements are being made pursuant to the safe harbor provisions of the Private Securities Litigation Reform Act of 1995. Actual results and the timing of certain events may differ materially from those indicated by such forward-looking statements due to a variety of risks and uncertainties, many of which are beyond Fieldstone's ability to control or predict, including but not limited to (i) Fieldstone's ability to successfully implement or change aspects of its portfolio strategy; (ii) interest rate volatility and the level of interest rates generally; (iii) the sustainability of loan origination volumes and levels of origination costs; (iv) continued availability of credit facilities for the liquidity we need to support our origination of mortgage loans; (v) the ability to sell or securitize mortgage loans on favorable economic terms; (vi) deterioration in the credit quality of Fieldstone's loan portfolio; (vii) the nature and amount of competition; (viii) the impact of changes to the fair value of Fieldstone's interest rate swaps on its net income, which will vary based upon changes in interest rates and could cause net income to vary significantly from quarter to quarter; and (ix) other risks and uncertainties outlined in Fieldstone Investment Corporation's periodic reports filed with the Securities and Exchange Commission. These statements are made as of the date of this press release, and Fieldstone undertakes no obligation to publicly update or revise any forward-looking statement, whether as a result of new information, future events or otherwise. DATASOURCE: Fieldstone Investment Corporation CONTACT: Investor Relations, Fieldstone Investment Corporation, +1-410-772-5160, Toll-Free: +1-866-438-1088, Web site: http://www.fieldstoneinvestment.com/

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