Aames to End REIT Status

Aames Investment Corp., a Los Angeles-based subprime mortgage lender, has announced that it will end its status as a real estate investment trust in conjunction with a cost reduction initiative.The company said ending its REIT status is expected to enable it to retain its portfolio earnings, increase its book value, and support loan portfolio growth while using its $304 million of net operating loss carry-forwards. The cost reduction initiative is designed to cut the company's overhead expenses and reduce its net-cost-to-originate ratio to below 1.50%. Under the scheme, Aames is introducing a more stringent wholesale loan pricing matrix and will eliminate products it said are unprofitable in the current market. Aames announced in February 2004 that it would switch to REIT status through an initial public offering. The latest announcement came after the New York Stock Exchange ended its trading day on March 16. On that day Aames closed at $5.35 per share. By midday on March 17, the stock was trading at $5.55 per share, after going as high as $5.79 per share. Aames can be found online at http://www.aames.net.