TORONTO: Sentry Select Capital Corp., the Trustee and Manager of MBS Adjustable Rate Income Fund and Sentry Select MBS Adjustable Rate Income Fund II (the “Trusts”), is pleased to announce that the Trusts are increasing their monthly distributions from $0.03 per unit to $0.05 per unit, effective with the March distributions. Subsequent to a renegotiation of their respective currency hedges, the Trusts have additional capital that is available for distribution and re-investment in the portfolio.
The Trusts expect to continue paying the current monthly distributions for the remainder of 2006. However, if market conditions change, the distributions may differ.
Since Sentry Select Mortgage-Backed Securities Trust does not have a currency hedge, its distributions remain unchanged.
Distributions: The new distribution represents an annualized amount of $0.60 per unit. Based on the March 2, 2006 net asset value of $7.64 per unit for MBS Adjustable Rate Income Fund and $7.83 per unit for Sentry Select MBS Adjustable Rate Income Fund II, the annualized payouts would be 7.9% and 7.7% respectively. The investment objective of the Trusts is to provide unitholders with monthly distributions that, in any year, are targeted to approximate the average yield on 10-year U.S. Treasuries plus 3%.
The Trusts: Through a limited partnership, the Trusts invest in a portfolio consisting primarily of mortgage-backed securities with actual or implied AAA rating, issued by the U.S. agencies commonly known as Ginnie Mae, Fannie Mae and Freddie Mac.
Forward-looking statements: This news release contains forward-looking statements that involve risks and uncertainties. These forward-looking statements relate to, among other things, the future performance of the Trust, including the potential for future distributions. When used in this news release, the words “in the future” and “believe,” and the use of the future tense generally identify forward-looking statements. These statements reflect Sentry Select’s current expectations, but are subject to a number of risks and uncertainties. Due to those risks and uncertainties, Sentry Select cannot give assurances that the forward-looking statements contained in this news release will be realized.
Investment manager: Fixed Income Discount Advisory Company (FIDAC) is the investment manager of the Trusts. FIDAC is one of the leading fixed-income management companies specializing in U.S. agency mortgage-backed and Treasury securities. FIDAC and its related companies are responsible for the management of approximately US$35 billion in gross assets.
The manager: Sentry Select Capital Corp. provides investment, administrative and marketing services to 22 exchange-listed closed-end funds, 16 of which have exposure to the income trust sector, 11 mutual funds, eight principal-protected notes and four limited partnerships. Sentry Select is one of the largest Canadian investment managers in the income trust sector. As of January 31, 2006, the firm had approximately $8.5 billion in gross assets under management.
More information: Investor Services (broker/investor inquiries), Brian McOstrich (media inquiries) or Kevin Cohen (Corporate Secretary).Tel: 1-888-246-6656 Fax: 416-364-1197 firstname.lastname@example.org www.sentryselect.com
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