Allied Capital Commercial Corporation Announces 1994 Results 1994 Net Income Increases 50%.

WASHINGTON--(BUSINESS WIRE)--Feb. 22, 1995--Allied Capital Commercial Corporation (Nasdaq:ALCC) announced 1994 results today. For the year ended December 31, 1994, net income was $18.3 million or $1.42 per share as compared to $12.2 million or $0.95 per share for the year ended December 31, 1993, a 50% increase. Net income, which includes interest on mortgage loans and liquid securities, and capital gains resulting from dispositions of mortgage loans, increased primarily due to significant growth in the Company's portfolio of mortgage loans to small businesses. Net investment income was $15.9 million in 1994, as compared to $11.3 million in 1993, a 40% increase. Gain on the disposition of mortgage loans was $2.4 million in 1994, as compared to $.9 million in 1993, a 183% increase. Total distributions of taxable income to shareholders, including four regular quarterly dividends and a $0.22 extra distribution, were $1.47 per share, an increase of 47% over 1993 dividends of $1.00 per share. The continued growth in profits has allowed the Company to continually increase its regular quarterly dividend throughout 1994, from $0.25 per share for the fourth quarter of 1993 to $0.35 per share for the fourth quarter of 1994. The Company has increased the regular quarterly dividend again in the first quarter of 1995 to $0.38 per share.

Allied Capital Commercial Corporation purchased or originated loans totalling approximately $26 million during the fourth quarter of 1994. Total new loans, purchased or originated, in 1994 were approximately $108 million, an increase of 57% over new loans of $69 million in 1993. Net of repayments and amortization of market discounts, the Company increased its total investments in mortgage loans to small businesses by $86 million or 77% during the year. This solid increase in investment activity will result in improved investment income in future years, as the Company has made significant progress during the year in decreasing the level of cash and low-yielding government securities in the portfolio, and replacing those investments with higher yielding mortgage loans to growing small businesses. At December 31, 1994, investments in mortgage loans totaled 85% of the Company's total assets, as compared to 63% at December 31, 1993.

The Company has secured credit facilities totalling $90 million for future investment growth, which it shares with a private mortgage REIT. Funds available to the Company under this line, net of amounts already drawn, are $56 million. The Company is continuing to actively pursue additional long-term financing to finance future growth. -0-

 (in thousands)            12 Mos. Ended               12 Mos. Ended
                      12/31/94      Per Share      12/31/93      Per Share

Balance Sheet Information
Total investments in
 mortgage loans       $198,514         --           $112,255          --
Total assets           233,555         --            178,374          --
Shareholders' equity   178,839       $ 13.59         175,960       $ 13.72

Operating Information
Net investment income $ 15,881        $ 1.23        $ 11,339        $ 0.88
Net gains on dispositions
 of mortgage loans       2,433          0.19             861          0.07
Net income            $ 18,314        $ 1.42        $ 12,200        $ 0.95

Actual shares
 outstanding            13,161           --           12,829           --
Weighted avg. shares
 outstanding            12,934           --           12,846           --

Distributions to Shareholders
Regular dividends         --          $ 1.25            --          $ 1.00
Annual extra dividend     --            0.22            --            0.00
Total distributions       --          $ 1.47            --          $ 1.00

                           3 Mos. Ended                3 Mos. Ended
                      12/31/94      Per Share      12/31/93      Per Share

Balance Sheet Information
Total investments in
 mortgage loans       $198,514          --        $112,255            --
Total assets           233,555          --         178,374
           --
Shareholders' equity   178,839       $ 13.59       175,960        $ 13.72

Operating Information
Net investment income  $ 3,788(a)     $ 0.29       $ 3,667         $ 0.29
Net gains on dispositions
 of mortgage loans         804          0.06            69           0.00
Net income             $ 4,592        $ 0.35       $ 3,736         $ 0.29

Actual shares
 outstanding            13,161           --         12,829            --
Weighted avg. shares
 outstanding            13,058           --         12,846            --

Distributions to
 Shareholders
Regular dividends         --          $ 0.35           --           $ 0.25
Annual extra dividend     --            0.22           --             0.00
Total distributions       --          $ 0.57           --           $ 0.25

(a) Net investment income in the fourth quarter of 1994 was reduced by a provision for loan reserves.

Allied Capital Commercial Corporation is a publicly traded real estate investment trust headquartered in Washington, DC, traded on Nasdaq National Market, symbol ALCC. There are a total of 13,217,335 shares outstanding. The Company currently pays a regular quarterly cash dividend of $0.38 per share and for 1994 paid an extra cash distribution of $0.22 per share for a total distribution to shareholders for 1994 of $1.47 per share. A recent stock quote is $15.75 per share; the stock of the Company is marginable. For additional information or a copy of the Company's annual report, please contact Allied Capital's Investor Relations Department at [phone] or fax to [phone].

CONTACT: Allied Capital Commercial Corporation, Washington

Suzanne Sparrow, 202/331-1112