Gray Ghost's Secondary Market Activity Picks Up Steam

Atlanta, GA , October 6, 2006 —

The purchase of the shares owned by the Norwegian Investment Fund for Developing Countries (Norfund) and the Multilateral Investment Fund (MIF) of the Inter-American Development Bank (IDB) in the Latin American Challenge Investment Fund (LACIF) in July of this year marked the start of a series of secondary market purchases, each supporting Gray Ghost’s strategic mission to promote secondary market activity in microfinance and demonstrate the opportunity for exit out of microfinance investments.

“These purchases support our goal to demonstrate the viability of microfinance as an alternative investment opportunity,” said Paul DiLeo, Chief Executive Officer of Gray Ghost. “Increasing the volume of activity in the microfinance secondary market is a strong vote of confidence in the specific funds involved, but it is also good for Gray Ghost and other investors that in the medium term need to see liquidity developing,” he added.

Buyout of IDB shares in Accion Investments in Microfinance Fund

Last month, The Gray Ghost Fund acting on behalf of its sister company Gray Matters Capital, purchased 2305 shares in the Accion Investments in Microfinance Fund (AIM) from the Multilateral Investment Fund (MIF) of the Inter-American Development Bank (IDB). The transaction is the largest secondary market transaction in microfinance assets at the fund level, and aligns with Gray Ghost’s strategic approach to buy out founding official investors to enable the transformation of microfinance investment vehicles from majority official to majority private, market-oriented investors.

“This type of secondary market transaction is a clear demonstration of the demand for socially responsible assets in Latin America, and it will enable us to recycle capital and deploy it into other innovative and riskier initiatives which will further support the advancement of microfinance,” said Tomas Miller of the Multilateral Investment Fund (MIF) and Inter-American Development Bank (IDB).

Gray Ghost first made an investment in AIM in 2003 and this new investment by its sister company is intended toposition the fund to attract other private capital shareholders and assist AIM in its efforts to recapitalize and consolidate its Latin American and African portfolios into one global portfolio.

Purchase of B-Class notes from the Netherlands Development Finance Company

Gray Ghost also completed negotiations last month with the Netherlands Development Finance Company (FMO) and agreed to purchase $3MM in first-loss Collateralized Loan Obligation (CLO) Notes issued by BlueOrchard Loans for Development 2006-1 S.A (BOLD) from the company.

FMO acted as lead underwriter and co-arranger of the B-Class notes on the initial transaction in April of this year and purchased the notes with the intent to resell a portion of their investment in the secondary market. The fact that the BOLD securities have been successfully sold without guarantee marks, in Gray Ghost’s view, another important step in the maturation of the market for Collateralized Debt Obligations (CDOs) in the microfinance sector.

“In an emerging sector where it has been considered difficult to price and value assets, the realization of these transactions over the last two months clearly demonstrates that market forces are working and microfinance assets are continuing to mature and become relevant to a broader array of investors,” concluded DiLeo.

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About The Inter-American Development Bank

The Washington, DC-based Multilateral Investment Fund of the Inter-American Development Bank is the leading source of multilateral financing for economic and social development programs in Latin America and the Caribbean. Over the past three decades it has provided more than $1 billion for micro-enterprise and microfinance related projects in the region. For more information on the IDB and its work, visit www.iadb.org.

About Accion Investments in Microfinance

ACCION International has sponsored the creation of, and provides management services for, ACCION Investments in Microfinance (AIM), an investment company designed to make equity and quasi-equity investments worldwide. After just three years in operations, AIM has almost fully invested its $19.5 million of original capital. AIM is currently invested in Banco Solidario (Ecuador), BancoSol (Bolivia), Mibanco (Peru), Visión (Paraguay), Apoyo Integral (El Salvador) and ACCION Microfinance Bank Limited (Nigeria).For more information on AIM and its work, visit www.accion.org/services_accion_investments.asp.

About The Netherlands Development Finance Company

The Netherlands Development Finance Company (FMO) is the international development bank of the Netherlands. FMO invests risk capital in companies and financial institutions in developing countries. FMO’s investment portfolio if EUR 2.4 billion and FMO is one of the largest bilateral development banks worldwide. Thanks in part to its relationship with the Dutch government, FMO is able to take risks which commercial financiers are not – or not yet – prepared to take. FMO’s mission: to create flourishing enterprises, which can serve as engines for sustainable growth in their countries. For more information on FMO and its work, visit www.fmo.nl

ABOUT THE GRAY GHOST FUND

The Gray Ghost Microfinance Fund, Inc, is a $75-million, for-profit portfolio of investments aimed at connecting private social investors with microfinance opportunities worldwide. As a fund of funds, Gray Ghost hopes to educate the investment community about the dual benefits of microfinance investing as both a means of growing individual wealth and alleviating poverty. The Gray Ghost Microfinance Fund is committed to enriching lives, both financially and spiritually, on both sides of the investment relationship. For more information on the Gray Ghost Microfinance Fund and its work, visit www.grayghostfund.com.

MEDIA CONTACT

Yvonne Johanneson-Jones
Strategic Marketing and Compliance Officer
yjones@grayghostfund.com
678.365.4715