Capital Alliance Income Trust Ltd. Announces Extension of a Major Term Credit Facility.

Business Editors

SAN FRANCISCO--(BUSINESS WIRE)--March 14, 2003

Capital Alliance Income Trust Ltd. ("CAIT") (AMEX:CAA), a specialty, non-conforming residential mortgage finance company, announced that it has negotiated a 21-month extension of the maturity date of its existing $7,000,000 term credit facility with Washington Mutual Bank, FA ("Washington Mutual") through June 30, 2004. As part of the negotiations, Washington Mutual also agreed to provide CAIT with up to an additional $3,000,000 credit facility to allow CAIT to "bulge" its aggregate borrowing from WAMU up to $10,000,000 during the facility's term.

Thomas B. Swartz, chairman and CEO of CAIT, stated that "the extension" of the Washington Mutual term credit facility will increase CAIT's liquidity and enhance its ability to more fully take advantage of favorable interest rate spreads and will enable CAIT to increase its niche bridge financing business and expand its core portfolio mortgage lending business which has been consistently profitable.

Richard J. Wrensen, executive vice-president and chief financial officer of CAIT, again reiterated his observation in 2002 that CAIT not only will continue to discuss increased credit commitments with its existing lenders and to seek additional borrowing facilities and banking relationships, but also will explore avenues to increase its capital base. He observed that "CAIT continues to maintain a conservative balance sheet since CAIT and its subsidiary's borrowings are only 1.5 times their capital base. Most mortgage REIT's borrow six to eight or more times their capital. All loans with a combined loan-to-value ratio of more that 75% of the collateral's appraised value at the time of funding are pre-sold into the secondary market. Only loans with a combined loan-to-value ratio of less than 75% are retained in CAIT's portfolio of mortgage investments."

CAIT is a specialty residential mortgage lender which invests in high-yielding, non-conforming residential mortgage loans on one-to-four unit residential properties located primarily in California and other western states. It also originates loans for sale to investors on a whole loan basis for cash through its subsidiary Capital Alliance Funding Corp.

This document contains "forward-looking statements" (within the meaning of the Private Securities Litigation Reform Act of 1995) that inherently involve risks and uncertainties. CAIT's actual results and liquidity can differ materially from those anticipated in these forward-looking statements because of changes in the level and composition of CAIT's investments and unforeseen factors. As discussed in CAIT's filings with the Securities and Exchange Commission, these factors may include, but are not limited to, changes in general economic conditions, the availability of suitable investments, fluctuations in and market expectations for fluctuations in interest rates and levels of mortgage prepayments, deterioration in credit quality and ratings, the effectiveness of risk management strategies, the impact of leverage, the liquidity of secondary markets and credit markets, increases in costs and other general competitive factors.