Mr. Eli Dadouch reports

FIRM CAPITAL MORTGAGE INVESTMENT CORPORATION PROVIDES UPDATE ON ITS INVESTMENT PORTFOLIO, BALANCE SHEET POSITION, AND TRADING METRICS

Firm Capital Mortgage Investment Corp. is issuing this press release to update shareholders on the company's investment portfolio, corporate balance sheet position and trading metrics.

Investment portfolio highlights

The corporation specializes in providing bridge mortgage financing that entails seeing the portfolio revolve and redeployed into new investments based on new valuations:

• The portfolio as of today stands at approximately $587-million spread over 237 separate investments;
• 95 per cent of the portfolio have variable interest rates and are priced to be the greater of: (i) bank prime plus a spread, and (ii) a fixed rate that in most cases equals to the base rate. As such, the corporation captures the upside in interest rates increases, while never going below the base rate in a recessionary environment when interest rates decline. As proof of this strategy, the average face interest rate on the portfolio has increased to 11.16 per cent per annum;
• The portfolio has been reduced from a peak of approximately $681-million (June 30, 2022) to $587-million. This has been accomplished entirely through net repayments of approximately $94-million. Senior management of the corporation welcomes this portfolio reduction as it confirms the ability to be repaid upon maturity and the ability to reinvest this incoming cash in the current environment amidst reset valuations;
• Approximately 85 per cent of the portfolio matures by Dec. 31, 2024, of which 36 per cent matures by Dec. 31, 2023. This will allow the corporation to further roll the cash into new investments;
• In the past 12 months, the company had $291-million in new transactions, signifying a fresh cash outflow into investments. Additionally, around $110-million of existing investments were reunderwritten, while $361-million was returned in repayments. This once again confirms the ability to be repaid upon maturity and reinvest this incoming cash in the current inflationary environment;
• Of the $587-million making up of the current portfolio, approximately 87 per cent was either reunderwritten or newly financed during 2022 and 2023. Only approximately 13 per cent of the portfolio is associated with investments that were underwritten or newly financed in 2021 or prior, which is a mitigating risk factor regarding valuations (see chart herein).

The portfolio's revolving nature demonstrates the successful implementation of the company's bridge financing strategy.

Corporate balance sheet position/liquidity

The corporation is well positioned to take advantage of new lending opportunities in a market whereby credit at major financial institutions and other alternative lenders has pulled back. The company tends to flourish in these markets -- dictating loan security, credit quality and sponsorship:

1. The corporation has approximately $15.5-million of cash on deposit;
2. The corporation has an undrawn credit facility of $180-million;
3. Debt as a percentage of the portfolio stands at a conservative 34 per cent;
4. The corporation has a 5.2 per cent, $22.5-million convertible unsecured debentures (TSX: FC.FB.G) expiring on Dec. 31, 2023, that it intends to redeem from cash on its balance sheet prior to or on maturity;
5. The corporation has a prudent impairment allowance that provides stability of dividends to the company's shareholders in the event there are any future issues with any of the loans within the corporation's portfolio. The allowance for impairment and fair value adjustment as of June 30, 2023, was $16.5-million which represents approximately 2.8 per cent of the current portfolio.

Shares trading at an 11-per-cent discount or 0.9 times to net asset value (NAV)

The corporation has an adjusted NAV of $11.33/share. This represents an 11-per-cent discount to the current trading price of $10.00/share. Alternatively, the corporation's common shares are trading at 0.9 times of NAV.

9.5-per-cent dividend yield

Based on the current trading price, the corporation has a 9.5-per-cent dividend yield. Further, the corporation has paid consistent monthly cash dividends plus a year-end special dividend since inception in 1999.

It will be the intention of the corporation to provide this reporting on a regular basis.

About Firm Capital Mortgage Investment Corp.

The corporation, through its mortgage banker, Firm Capital Corp., is a non-bank lender providing residential and commercial short-term bridge and conventional real estate financing, including construction, mezzanine and equity investments. The corporation's investment objective is the preservation of shareholders' equity, while providing shareholders with a stable stream of monthly dividends from investments. The corporation achieves its investment objectives through investments in selected niche markets that are underserviced by large lending institutions. Lending activities to date continue to develop a diversified mortgage portfolio, producing a stable return to shareholders. Full reports of the financial results of the corporation for the year are outlined in the audited consolidated financial statements and the related management discussion and analysis of the corporation, available on SEDAR. In addition, supplemental information is available on the corporation's website.

We seek Safe Harbor.