IRVINE, Calif., Aug. 25 /PRNewswire-FirstCall/ -- ECC Capital Corporation (Pink Sheets: ECRO), a mortgage finance real estate investment trust, announced today that its Board of Directors has declared a cash distribution of $0.16 per share of common stock. ECC Capital will make this distribution on Monday, September 22, 2008, to shareholders of record on Monday, September 8, 2008. The distribution will have an ex-dividend date of September 23, 2008. This distribution and the prior distribution on March 21, 2008 were the result of one time events and changes in ECC Capital's perspective. These distributions should in no way be viewed as an indicator of future distributions. Several circumstances have contributed to ECC Capital's ability to make a $0.16 distribution on September 22, 2008. These circumstances include, but are not limited to: -- ECC Capital continues to experience higher levels of delinquency and losses on its mortgage loans held for investment in its securitization trusts. Therefore, ECC Capital estimates that the probability and amount of future cash from over-collateralization has been significantly reduced. Consequently, ECC Capital has significantly reduced the estimate of cash expenditure and investment directed toward maximizing future over-collateralization releases. -- ECC Capital has changed its perspective and reduced the amount of capital that should be retained to invest in its existing and new business opportunities. Management has not found any significant investment opportunities that provide returns that are commensurate with related risk. Therefore, a significant portion of ECC Capital's allocated investment capital will be returned to the shareholders. -- ECC Capital has settled certain liabilities, claims, contractual obligations and restrictions. In addition, ECC Capital sold certain real estate owned properties and collected on certain loans. Collectively, these events provided for a reduction in required cash reserves and an increase in cash. -- ECC Capital has benefited from reduced operating costs. ECC Capital has evaluated and will continue evaluating several alternatives to facilitate the realization of any remaining shareholder value, which include, but are not limited to: -- A sale of some or all of its assets. -- A sale of the company. -- Investment in business opportunities that may defray the cost of its remaining operations. -- Use of technology to oversee and maximize the value of its remaining mortgage portfolio or produce revenue from third parties. -- Outsourcing of various functions. -- Partnering and/or joint venturing to reduce cost or increase revenue. ECC Capital has retained Milestone Advisors as its banker and advisor to assist in this process. There are no assurances that these efforts will result in additional distributions. In the absence of a transaction that allows otherwise, ECC Capital plans to retain the necessary capital to maintain its reduced ongoing operations in addition to meeting the obligations of creditors. Further, since ECC Capital must retain enough cash to operate and to meet creditor obligations it will continue to look for investments or pursue opportunities that it believes may grow shareholder value. Any remaining shareholder value may be impacted by potential losses on investments, expenses associated with ongoing operations, its existing liabilities, the adverse changing and unpredictable environment in which it operates. Therefore, ECC Capital cautions that there may be no further distributions. ECC Capital has previously issued press releases in the past to update shareholders. Going forward, in an effort to reduce costs and because of reduced staff and limited operations, ECC Capital will limit its use of press releases. Please periodically check ECC Capital's website for information. You may also contact ECC Capital using the toll free number of 866-338-8749 or via email at . Safe Harbor Regarding Forward-Looking Statements Certain statements contained in this press release, including those regarding future distributions to shareholders and the release of proceeds related to over-collateralization may be deemed forward-looking statements under federal securities laws and ECC Capital intends that those forward-looking statements be subject to the safe-harbor created thereby. These forward-looking statements are based on current expectations and assumptions and are subject to risks and uncertainties, which could affect ECC Capital's future plans. ECC Capital cautions that these statements are qualified by important factors that could cause actual results to differ materially from those reflected by the forward-looking statements. These factors include, but are not limited to: (1) the impact of losses and delinquencies from ECC Capital's residual interests in securitizations (2) the tightening of credit standards, (3) the condition of the U.S. economy and financial system, (4) interest rates and the subsequent effect on the business, (5) ECC Capital's ability to obtain quality loan servicing and default management services, (6) the stability of residential property values, (7) the potential effect of new state or federal laws or regulations, (8) ECC Capital's ability to implement successfully its business plan, (9) continued availability of credit facilities and access to the securitization and capital markets or other sources of capital, (10) ECC Capital's ability and the ability of its subsidiaries to operate effectively within the limitations imposed on REITs by federal tax rules, (11) ECC Capital's ability to qualify for exemptions under any SEC registration requirements; (12) ECC Capital's ability to retain qualified personnel, (13) the outcome of various pending litigation, and (14) other factors and risks discussed in ECC Capital's financial report for the year ended December 31, 2007 and the three months ended March 31, 2008 posted on its webpage and its Annual Report on Form 10-K for the year ended December 31, 2006, which is on file with the Securities and Exchange Commission. You should also be aware that, except as otherwise specified, all information in this news release is as of August 25, 2008. ECC Capital undertakes no duty to update any forward-looking statement to conform the statement to actual results or changes in ECC Capital's expectations. For Further Information: For Further Information: AT THE COMPANY: Roque A. Santi President and Chief Financial Officer (949) 955-8730 DATASOURCE: ECC Capital Corporation CONTACT: Roque A. Santi, President and Chief Financial Officer of ECC Capital Corporation, +1-949-955-8730, Web site: http://www.ecccapital.com/

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