Understanding FBR

FBR Capital Markets Corporation (FBR Capital Markets; NASDAQ:FBCM), a fully consolidated subsidiary of FBR Group, Inc. (FBR Group; NYSE:FBR), is a top ten investment bank¹ with an international franchise, one of the strongest equities distribution capabilities in the securities industry and a growing asset management business.

In 2007, FBR Capital Markets' Investment Banking group was ranked as the:

#1 book-running manager of all common stock offerings for U.S. companies with a market capitalization of $1 billion or less²
#3 book-running manager for all U.S. IPOs and 144A equity placements combined for all industries³
#1 book-running manager of all common stock offerings for domestic mining, oil and gas, and utility and energy companies, with a market capitalization of $1 billion or less⁴
#1 book-running manager of all common stock offerings for U.S. and Bermuda finance and insurance companies with a market capitalization of $1 billion or less⁵

FBR Capital Markets focuses its banking, advisory, trading and research efforts in eight broad industry sectors – consumer, diversified industrials, energy & natural resources, financial institutions, healthcare, insurance, real estate and technology, media & telecom. With our headquarters in the Washington, D.C. metropolitan area, our Economic and Washington Policy Analysis groups offer clients a comprehensive overview of national economic trends along with a unique perspective on the impact that legislation and regulation will have on industry sectors and individual companies.

With a substantial team of brokers, traders and sales traders in Washington, New York, Boston and London, FBR Capital Markets is, as of February 2008, a market-maker or trader in more than 920 securities and provided independent research on more than 490 companies representing 24% of the S&P 500 by market capitalization.⁶

On the asset management side of our business, FBR Capital Markets’ registered investment subsidiaries provide clients with a range of investment choices that includes a family of mutual funds, hedge funds and funds of funds.^* Our Private Wealth group offers a broad array of services to high net worth investors and foundations.

FBR Group and FBR Capital Markets are headquartered in Arlington, Virginia. FBR Capital Markets also has offices in Sydney, Boston, Dallas, Houston, Irvine, London, New York and San Francisco. For more information about FBR Group, visit www.fbr.com.

*Investors should consider the investment objectives, risks, charges, and expenses carefully before investing. This and other important information can be found in the fund's prospectus. To obtain data current to the most recent month-end and a free prospectus, please call 888.200.4710 or visit www.fbrfunds.com. Investment return and principal will fluctuate so that investors’ shares, when redeemed, may be worth more or less than their original costs. Please read the prospectus carefully before investing. The FBR Funds are distributed by FBR Investment Services, Inc., member NASD/SIPC.
1) Source: Dealogic. As measured by the aggregate value of the U.S. common equity underwritings completed between 1/1/03 and 12/31/07 with apportioned credit including over-allotment to all book-running managers. Includes only rank eligible transactions.
2) Source: Dealogic. Relates to total deal value of all common stock or common equity, including private placements, offered for all U.S. companies with a market capitalization of $1 billion or less. Transactions priced between 1/1/03 and 12/31/07 with apportioned credit including over-allotment to all book-runners. Includes only rank eligible transactions.
3) Source: Dealogic. Relates to total deal value of all common stock of U.S. issuers offered in IPOs or transactions exempt from SEC registration pursuant to rule 144A, on a combined basis. Transactions priced between 1/1/03 and 12/31/07 with apportioned credit including over-allotment to all book-runners. Includes only rank eligible transactions.
4) Source: Dealogic. Relates to total deal value of all common stock or common equity, including private placements, offered for all U.S. mining, oil and gas, and utility and energy companies with a market capitalization of $1 billion or less. Transactions priced between 1/1/03 and 12/31/07, with apportioned credit including over-allotment to all book-runners. Includes only rank eligible transactions
5) Source: Dealogic. Relates to total deal value of all common stock or common equity, including private placements, offered for all U.S. and Bermuda finance and insurance companies with a market capitalization of $1 billion or less. Transactions priced between 1/1/03 and 12/31/07, with apportioned credit including over-allotment to all book-runners. Includes only rank eligible transactions.
6) Research is provided by FBRC's Research department, which is independent from the Investment Banking department of FBRC and has the sole authority to determine which companies receive research coverage and the recommendation contained in the coverage. In the normal course of its business, FBRC seeks to perform investment banking and other fee generating services for companies that are the subject of FBRC research reports. Research analysts are eligible to receive bonus compensation that is based on FBRC’s overall operating revenues, including revenues generated by FBRC’s investment banking department. Specific information is contained in each research report concerning FBRC’s relationship with the company that is the subject of the report.