Ameritrans Capital Corporation Reports First Quarter Fiscal 2007 Results.

NEW YORK -- Ameritrans Capital Corporation (NASDAQ: AMTC, AMTCP, AMTCW) yesterday reported financial results for the quarter ended September 30, 2006. Ameritrans reported a net loss of ($51,348) available to common shareholders for the first quarter of fiscal year 2007 or ($0.02) versus a net loss of ($75,431) or ($0.03) per basic and diluted common share for the same period of fiscal year 2006. On an operating basis, before payment of the Company's preferred stock dividends, before provisions for income tax, the Company reported an operating profit of $35,082 for the quarter ended September 30, 2006 compared to an operating profit of $18,668 during the quarter ended September 30, 2005.

The Company's interest income for the three months ended September 30, 2006 increased $74,358 or 6% to $1,224,141 as compared to the three months ended September 30, 2005. The increase in investment income between the periods can be attributed to higher average interest rates charged on the total loan portfolio for the quarter. Fees and other income increased by $96,786 or 117% to $179,087 as compared to the three months ended September 30, 2005. The increase is primarily attributed to an increase in loan origination fees of approximately $74,000 and an increase in other income of approximately $21,000. The Company also had approximately $28,000 of other income from its share of equity in income of investee.

Commenting on the results, Gary C. Granoff, Ameritrans' President, said, "During the quarter ended September 30, 2006, the Company was positively impacted by increases in interest income, fees and other income. We had positive earnings on an operating basis before taking into account payment of our preferred dividend."

Mr. Granoff further stated, "We are continuing to take measures to expand our loan portfolio on a conservative but profitable basis which should continue to have a beneficial effect by increasing our gross income as transactions are completed. Our new loans in the diversified business loan area and in the Ameritrans loan portfolio are being done primarily on an adjustable basis so that periodically we will be adjusting the interest rate payable by the borrower to reflect current market rates. Our margins have leveled after a cease in the numerous increases in short term market rates of interest charged by our banks. Our interest rate swaps have assisted the Company to control our interest costs on the floating portion of our bank debt against continued upward increases in interest rates."

Mr. Granoff added, "Our Chicago taxi medallion loan portfolio has continued to improve, and prices for medallions in Chicago have continued to increase. We have continued to sell off some of our medallions and we are presently in discussion with several parties regarding the sale of our remaining 24 medallions. We have very few foreclosures of medallions pending in Chicago at this time. During the quarter we further expanded the Ameritrans side of the business, with our new loans deployed at initial rates of approximately 12.5% on a weighted basis. During the quarter, we also invested approximately $1.1 million in the new area of life settlement contracts. We anticipate additional investment opportunities in the future in this area."

Ameritrans Capital Corporation is a specialty finance company engaged in making loans to and investments in small businesses. Ameritrans' wholly owned subsidiary Elk Associates Funding Corporation was licensed by the United States Small Business Administration as a Small Business Investment Company (SBIC) in 1980. The Company maintains its offices at 747 Third Avenue, 4th Floor, New York, NY 10017.

This announcement contains forward-looking statements within the meaning of the Private Securities Litigation Reform Act of 1995. Such statements are subject to certain risks and uncertainties that could cause actual results to differ materially from those presently anticipated or projected. Ameritrans Capital Corporation cautions investors not to place undue reliance on forward-looking statements, which speak only as to management's expectations on this date.

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