NAV & 1st Quarter Earnings

Prodesse Investment Limited
01 August 2005


1 August 2005

PRODESSE INVESTMENT LIMITED ANNOUNCES EARNINGS FOR THE PERIOD ENDED 30 JUNE 2005

Prodesse Investment Limited (the 'Company') today reported net income for the
period ended 30 June 2005 of US$5.8 million or US$0.21 net income per average
share. The Company commenced operations on 8 April 2005, thus net income does
not reflect an entire quarter of operations.

As previously announced, dividends declared for the period ended 30 June 2005
were US$0.20 per share payable on 4 August 2005 to holders on record on 15 July
2005. The annualized dividend yield for the period, based on the 30 June 2005
closing price of US$9.63, was 9.02%. The Company was able to provide an
annualized return on average equity of 9.67% for the period ended 30 June 2005.

'We are pleased to announce the first period results for Prodesse,' said Michael
A.J. Farrell, chairman of FIDAC, the Investment Manager of the Company, 'We look
forward to continuing to justify investors' confidence in our ability to
generate high current income using high credit quality assets.'

For the period ended 30 June 2005, the annualized yield on average earning
assets was 4.01% and the annualized cost of funds on the average repurchase
balance was 2.67%, which equates to an interest rate spread of 1.34%. The
average daily leverage of the Company, as measured by repurchase
agreements-to-equity, was 5.8:1 during the period ended 30 June 2005 and 8.1:1
at period's end.

Wellington Denahan-Norris, Chief Investment Officer of FIDAC, the Investment
Manager of the Company, commented on the results for the period. 'During our
initial period of operations, our focus was on acquiring assets for the
investment portfolio. In our strategy, we look to the combination of fixed-rate,
adjustable-rate and floating-rate mortgage-backed securities to enable the
portfolio to perform through different interest rate environments.
Notwithstanding the fact that the current market environment is challenging and
that this has been a startup period, investment conditions for new capital are
promising and we were able to deliver a competitive dividend yield to investors
in Prodesse.'

Prepayment speeds on mortgage-backed securities, as reflected by the Constant
Prepayment Rate, or CPR, vary according to the type of investment, changes in
interest rates, conditions in the financial markets, competition and other
factors, none of which can be predicted with any certainty. In general, as
prepayment speeds on the Company's mortgage-backed securities portfolio
increase, related purchase premium amortization increases, thereby reducing the
net yield on such assets. The CPR on the Company's mortgage-backed securities
portfolio averaged 20% for the period ended 30 June 2005.

At 30 June 2005, the Company had a net asset value per share of US$9.56. After
excluding the effect of current period revenue items (net income for the period
of US$ 5,843,027) the reported net asset value per share is US$ 9.36. Fixed-rate
securities comprised approximately 33% of the Company's portfolio at 30 June
2005. The balance of the portfolio was comprised of 59% adjustable-rate
mortgage-backed securities and 8% LIBOR floating-rate collateralized mortgage
obligations. As of 30 June 2005, all of the assets in the Company's portfolio
were Fannie Mae and Freddie Mac mortgage-backed securities, which carry an
implied 'AAA' rating.

The Company applied to the Royal Court of Guernsey, immediately after the
placing of the shares, to reduce its share premium account in order to provide a
distributable reserve to repurchase its shares if and when it is considered
beneficial to do so by the Directors. As such the share premium account, after
deduction of preliminary costs, was reduced by US$220,299,299 and a
distributable reserve created for this amount.

The Investment Manager will conduct a conference all on Tuesday 2 August 2005 to
review the Company's financial results for the period ended 30 June 2005. The
conference call is scheduled for 3 P.M. London time (10 A.M. EST). All
interested parties are welcome to participate on the live call. International
callers can access the call by dialing 1-617-614-2713, or 0800-280-02002 for UK
callers or 1-800-659-2037 for US callers and the pass code is 52772825. Please
dial in 10 minutes prior to the scheduled start of the call and reference
'Prodesse Investment Limited Earnings Call'. There will be a replay available
for 48 hours beginning at 12 P.M. EST. The replay number is 1-617-801-6888 for
international callers and 1-888-286-8010 for US callers and 44-207-365-8427 for
UK callers and the pass code is 14462599.

This press release includes statements that are, or may be deemed to be,
''forward-looking statements''. These forward-looking statements can generally
be identified by the use of forward-looking terminology, including the terms
''believes'', ''estimates'', ''anticipates'', ''expects'', ''intends'', ''may'',
''will'' or ''should'' or, in each case, their negative or other variations or
comparable terminology. These forward-looking statements include all matters
that are not historical facts. All forward-looking statements address matters
that involve risks and uncertainties, are only predictions, and you should not
rely unduly on them. Accordingly, there are or will be important factors that
could cause the Company's actual results to differ materially from those
indicated in these statements. These factors include but are not limited to
those described in the Company's prospectus under the heading ''Special
Considerations and Risk Factors''. Any forward-looking statements in this press
release reflect the Company's current views with respect to future events and
are subject to these and other risks, uncertainties and assumptions relating to
the Company's operations, results of operations, growth strategy and liquidity.
These forward-looking statements speak only as of the date of this press
release. Subject to any obligations under the Listing Rules, the Company
undertakes no obligation publicly to update or review any forward-looking
statement, whether as a result of new information, future developments or
otherwise. All subsequent written and oral forward-looking statements
attributable to the Company or FIDAC or individuals acting on behalf of the
Company or FIDAC are expressly qualified in their entirety by this paragraph.
Prospective investors should specifically consider the factors identified above
which could cause actual results to differ before making any investment
decision.

Prodesse Investment Limited

Balance Sheet
(unaudited) as at 30 June 2005

                                                                          2005
________________________________________________________________________________
                                                                           US$
ASSETS

Current assets

Available for sale investments                                   2,627,255,210

Receivables
Accrued income receivable                           10,559,381
Receivable for principal paydowns                    8,327,274      18,886,655
                                                 ______________

Cash and cash equivalents                                                5,999

Prepaid expenses                                                        98,256
                                                                 _______________
Total assets                                                     2,646,246,120
                                                                 _______________

EQUITY AND LIABILITIES

Capital and reserves

Share capital:
28,610,000 @ US$ 0.01                                  286,100
Share premium                                       50,000,000
Distributable reserve                              220,299,299
Accumulated profits                                  5,843,027
Revaluation reserve                                 (2,843,493)
                                                 ______________

Total shareholders' equity                                         273,584,933
                                                                  ______________

Current liabilities
Securities purchased payable                       162,120,786
Reverse repos                                    2,206,752,000
Accrued interest expense                             2,759,461
Accrued expenses payable                             1,028,940
                                                 ______________

Total liabilities                                                2,372,661,187
                                                                 _______________
                                                                 _______________
Total equity and liabilities                                     2,646,246,120
                                                                 _______________

Net Assets                                                         273,584,933

Net Asset Value per share                                                 9.56
Net Asset Value per share excluding current
period revenue items                                                      9.36




Prodesse Investment Limited

Summary Income Statement
(unaudited) from the date of incorporation 22 February 2005 to 30 June 2005*

                                                                  For the period
                                                                  ending 30 June
                                                                            2005
________________________________________________________________________________
                                                                           US$
Income
Interest income                                                     16,231,405
Interest expense                                                    (9,330,907)
                                                                 _______________
Total income                                                         6,900,498
                                                                 _______________

Expenses
Management, Custodian and
Administration fee                                                     937,308
Other operating expenses                                               120,163
                                                                 _______________
Total expenses                                                       1,057,471
                                                                 _______________
                                                                 _______________
Net income for the period                                            5,843,027
                                                                 _______________

Other gains and losses recognised directly in equity:
Unrealised loss on revaluation of
available for sale investments                                       2,843,493
                                                                 _______________

Total recognised income and expense                                  2,999,534
                                                                 _______________

Net income for the period per average
share                                                                     0.21
                                                                 _______________
Weighted average number of shares
outstanding during the period                                       27,931,786
                                                                 _______________

* commencement of operations 08 April 2005





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