First Albany Reports Second Quarter 2003 Results.

Business Editors

ALBANY, N.Y.--(BUSINESS WIRE)--July 22, 2003

Consolidated Net Revenues and Net Income Posts Continued Strong

Growth; Equity Capital Markets Leads the Way with 58% Year-over-year

Increase In Net Revenues

First Albany Companies Inc. (NASDAQ: FACT) today reported its financial results for the second quarter ended June 30, 2003.

For the quarter, consolidated net revenues from continuing operations for First Albany Companies was $46.9 million, compared to $40.1 million for the same period in 2002, an increase of 17.0%. The Company reported consolidated net income from continuing operations of $2.4 million for the second quarter 2003, compared to a net income from continuing operations of $0.4 million for the same period in 2002. Second quarter 2003 net income per diluted share from continuing operations was $0.21 compared to $0.04 per diluted share in the second quarter of 2002. Including $0.1 million in discontinued operations net income, consolidated net income per diluted share was $0.22 for the second quarter 2003, compared to net income per diluted share of $0.01 in the second quarter of 2002.

Net revenues from the Company's brokerage operations, First Albany Corporation, was $42.7 million for the second quarter ended June 30, 2003, compared to $39.2 million for the same period in 2002, an increase of 8.9%. First Albany Corporation had net income of $1.6 million for the second quarter 2003, compared to $1.5 million for the same period in 2002.

For the six months ended June 30, 2003, consolidated net revenues from continuing operations for First Albany Companies was $92.6 million, compared to $78.3 million for the same period in 2002, an increase of 18.3%. The Company reported consolidated net income from continuing operations of $4.6 million for the six months ended June 30th, 2003, compared to a net loss from continuing operations of $1.6 million for the same period in 2002. For the six months ended June 30, 2003, net income per diluted share from continuing operations was $0.42 compared to a loss of $0.17 per diluted share in 2002.

Net revenues from the Company's brokerage operations, First Albany Corporation, was $82.0 million for the six months ended June 30, 2003, compared to $76.8 million for the same period in 2002, an increase of 6.8%. First Albany Corporation had net income of $2.6 million for the six months ended June 30, 2003, compared to $2.4 million for the same period in 2002.

Commenting on the Company's results, Alan Goldberg, President of First Albany Companies Inc. said, "The investments we have made in our businesses over the course of the last year are generating promising results. During the quarter, we made real progress in growing our Equity Capital Markets practice and diversifying its trading and investment banking revenues. Our Taxable Fixed Income and Municipal Capital Markets divisions continued to solidify their positions as leading players in their categories through strong trading performance and significant transaction activity. We look forward to extending our progress in the second half of this year."

                     First Albany Companies Inc.
                        (Dollars in Millions)
----------------------------------------------------------------------
                                                Net Revenue

                                  THREE MONTHS ENDED  SIX MONTHS ENDED
                                   June 30, June 30, June 30, June 30,
                                     2003     2002    2003    2002
----------------------------------------------------------------------

First Albany Corporation                $42.7    $39.2  $82.0   $76.8
Parent & Affiliates including FAAM and
 Investments                              4.2      0.9   10.6     1.6
                                         -----    -----  -----   -----
Total Consolidated from Continuing
 Operations                             $46.9    $40.1  $92.6   $78.3
                                         =====    =====  =====   =====

----------------------------------------------------------------------
                                                Net Income

                                  THREE MONTHS ENDED  SIX MONTHS ENDED
                                   June 30, June 30, June 30, June 30,
                                     2003     2002    2003     2002

First Albany Corporation                $ 1.6    $ 1.5  $ 2.6   $ 2.4
Parent & Affiliates including FAAM and
 Investments                              0.8     (1.2)   2.0    (4.0)
                                         -----    -----  -----   -----
Total Consolidated from Continuing
 Operations                               2.4      0.4    4.6    (1.6)
                                         -----    -----  -----   -----
Discontinued Operations                   0.1     (0.2)   0.1    (0.2)
                                         -----    -----  -----   -----
Total Consolidated                      $ 2.5    $ 0.1  $ 4.8   $(1.9)
                                         =====    =====  =====   =====

Major Segment Operating Results

First Albany Corporation

First Albany Corporation is the securities brokerage operation of the Company.

-- Taxable Fixed Income net revenues were $15.5 million for the

second quarter of 2003, up 12.3% from the $13.8 million for

the comparable prior year quarter. The increase in net

revenues in the Taxable Fixed Income division was driven

primarily by growth in daily trading volume.

-- Municipal Capital Markets net revenues were $9.9 million, down

22% from $12.7 million reported for the quarter ended June 30,

2002, due to lower investment banking and trading revenues

compared to the prior period. The quarter ended June 30, 2002

was an unusually strong quarter for the division due to a

strong underwriting calendar.

-- Equity Capital Markets net revenues were $12.0 million for the

second quarter of 2003, up 57.9% from the $7.6 million for the

second quarter of 2002, mostly due to a $4.6 million increase

in NASDAQ trading revenue. Despite the continued decline in

overall NASDAQ composite Index volumes, the Company achieved

148% increase in NASDAQ trading revenues.

Parent & Affiliates

-- First Albany Asset Management net revenues were $1.1 million

for the quarter ended June 30, 2003, up 80.3% from the

comparable quarter last year. The increase in net revenues was

due to both organic growth and the acquisition of Noddings,

which contributed $0.5 million in net revenues in the quarter.

Currently, First Albany Asset Management has approximately $1

billion in assets under management

-- Investment gains for the quarter ended June 30, 2003 were $2.9

million before income taxes due to an increase in fair market

value of the investment portfolio held by First Albany

Companies. During the quarter, FA Technology Ventures was the

lead investor in a $3 million round of financing for

Concentrix, a provider of customer relationship management

outsourcing support. The Company was also a co-lead investor

in Adapt Media, a leading provider of wireless outdoor

advertising infrastructure.

Shareholders' Equity

Shareholders' equity as of June 30, 2003 was $74.9 million compared to $69.7 million at March 31, 2003. Book value per share as of June 30, 2003 was $7.09 compared to $6.78 as of March 31, 2003. All per share figures have been restated to reflect stock dividends declared.

Guidance

The following information is based on current information as of July 22, 2003. The Company does not expect to update this guidance until next quarter's earnings release; however, the Company may update its full business outlook or any portion thereof at any time for any reason. The guidance given here assumes no further fluctuation in the value of the investments held in First Albany Companies' portfolio. This guidance is also subject to risks and uncertainties associated with general economic conditions that may cause actual results to differ materially from the guidance given.

First Albany Companies expects total consolidated net revenues for the full year ending December 31, 2003 to be between $195 million and $205 million. 2003 full year net income is expected to be between $9.4 million and $10.5 million.

Additional Announcement

The Company announced that during the last quarter, Mr. Goldberg assumed sole responsibility as Chief Executive Officer of First Albany Companies Inc. Mr. George McNamee, Chairman of First Albany Companies Inc., said, "For some time now Alan has overseen the day to day operations of the Company and we are pleased to recognize the completion of this transition that we began some time ago. As I have stated previously, my focus has been on the principal and venture investment portfolio of the Company, as well as the leadership of the Board."

Conference Call Information

First Albany Companies will hold a conference call today, July 22, 2003 at 5:00 p.m. (EDT). To participate on the call, please dial [phone] and request the First Albany conference call. A recording of the call will be available for 7 days by dialing [phone]. The call will be simultaneously broadcast over the internet and will be available thereafter at www.fac.com.

About First Albany

Founded in 1953, First Albany Companies Inc. is a leading institutionally focused independent investment bank and asset management firm. Through its Taxable Fixed-Income, Municipal and Equity Capital Markets Divisions, the firm focuses on serving the institutional market, the growing corporate middle market and public institutions by providing its clients with strategic, research-based, innovative investment opportunities. It offers a diverse range of products and advisory services in the areas of corporate and municipal finance and fixed-income and equity sales and trading. First Albany Asset Management currently has approximately $1 billion under management for institutional and high net worth clients. FA Technology Ventures, its venture capital fund, invests in early and expansion stage information technology (IT) and new energy technology (ET) companies. First Albany is traded on NASDAQ under the symbol FACT and today has 17 offices in 12 states.

This news release contains forward-looking statements, which are subject to various risks and uncertainties, including the conditions of the securities markets, generally, and acceptance of the Company's services within those markets and other risks and factors identified from time to time in the Company's filings with the Securities and Exchange Commission. Actual results could differ materially from those currently anticipated.

             FIRST ALBANY COMPANIES INC. AND SUBSIDIARIES
            CONDENSED CONSOLIDATED STATEMENT OF OPERATIONS
                             (Unaudited)

(In thousands of dollars
 except for per share     Three Months Ended      Six Months Ended
 Amounts and shares       June 30,    June 30,   June 30,    June 30,
 outstanding)               2003        2002       2003        2002
----------------------------------------------------------------------
Revenues
 Commissions            $     3,708 $    3,618 $     7,895 $    6,382
 Principal transactions      30,176     24,965      58,584     52,425
 Investment banking           7,720      9,130      12,970     14,899
 Investment gains
  (losses)                    2,913        (73)      7,760       (231)
 Interest                     1,385      4,438       3,207      8,714
 Fees and other               1,725      1,275       3,680      2,520
------------------------ ----------- ---------- ----------- ----------
Total revenues               47,627     43,353      94,096     84,709
 Interest expense               730      3,267       1,491      6,372
------------------------ ----------- ---------- ----------- ----------
Net revenues                 46,897     40,086      92,605     78,337
------------------------ ----------- ---------- ----------- ----------
Expenses (excluding
 interest):
 Compensation and
  benefits                   31,444     28,322      63,004     57,438
 Clearing, settlement
  and brokerage costs         1,365        771       2,429      1,591
 Communications and data
  processing                  3,722      2,822       7,204      5,398
 Occupancy and
  depreciation                2,375      2,326       4,644      4,381
 Selling                      1,806      1,694       3,476      3,182
 Other                        2,258      2,337       4,402      4,011
------------------------ ----------- ---------- ----------- ----------
Total expenses
 (excluding interest)        42,970     38,272      85,159     76,001
------------------------ ----------- ---------- ----------- ----------
Operating income
 (losses)                     3,927      1,814       7,446      2,336
------------------------ ----------- ---------- ----------- ----------
Equity in (losses)
 income of affiliate              -     (1,687)          -     (6,187)
------------------------ ----------- ---------- ----------- ----------
Gains on sale of equity
 holdings                         -        585           -      1,184
------------------------ ----------- ---------- ----------- ----------
Income (loss) before
 income taxes                 3,927        712       7,446     (2,667)
 Income tax expense
  (benefit)                   1,524        353       2,820     (1,018)
------------------------ ----------- ---------- ----------- ----------
Income (loss) from
 continuing operations        2,403        359       4,626     (1,649)
------------------------ ----------- ---------- ----------- ----------
Income (loss) from
 discontinued
 operations,
    net of taxes                146       (236)        146       (236)
------------------------ ----------- ---------- ----------- ----------
Net income (loss)       $     2,549 $      123 $     4,772 $   (1,885)
======================== =========== ========== =========== ==========
   Per share data:
     Basic earnings:
      Continued
       operations              0.23       0.04        0.45      (0.17)
   Discontinued
    operations                 0.01      (0.03)       0.01      (0.03)
------------------------ ----------- ---------- ----------- ----------
Net income (loss)              0.24       0.01        0.46      (0.20)
------------------------ ----------- ---------- ----------- ----------
 Diluted earnings:
  Continued operations         0.21       0.04        0.42      (0.17)
  Discontinued
   operations                  0.01      (0.03)       0.01      (0.03)
------------------------ ----------- ---------- ----------- ----------
Net income (loss)              0.22       0.01        0.43      (0.20)
------------------------ ----------- ---------- ----------- ----------
Weighted average common
 and common equivalent
 shares outstanding:
    Basic                10,469,444  9,601,224  10,353,924  9,542,014
    Dilutive             11,603,547  9,721,148  11,089,606  9,542,014
------------------------ ----------- ---------- ----------- ----------