Trading Statement

Queen's Walk Investment Limited
20 February 2007


February 20, 2007

                Queen's Walk Investment Limited ('Queen's Walk')
                                 Trading Update
                                        
Queen's Walk will announce its results for the quarter ended December 31, 2006 
on March 6, 2007 at 7 am London time.  The announcement will be followed by a 
teleconference call at 2 pm London time (details below).

The majority of the investments in the Company's portfolio continue to perform 
better than or in line with expectations and credit losses to date are generally 
consistent with projections.  However, the Company has noted in the latest 
performance data that certain of the UK mortgage residual positions in its 
portfolio are performing below expectations. The Company's investment manager, 
Cheyne Capital Management (UK) LLP, has determined it prudent to adjust the 
prepayment and default assumptions contained in the valuation models in respect 
of these assets to reflect this performance data.

Despite recent concerns regarding the US housing and consumer finance markets, 
the Company's US mortgage residual investments (accounting for approximately 11% 
of the Company's gross asset portfolio as at December 31, 2006) have performed 
better than expected.  The Company's European assets, including its more recent 
SME investments, have also performed well.

While the valuations remain subject to review by the Company's validation agents 
and by its auditors, the investment manager has determined that these 
adjustments will have an impact on the Company's ability to pay the target 
dividends announced at the time of publication of its semi-annual accounts in 
November 2006.  After giving effect to increases in the valuations of assets 
that have performed ahead of expectation, the net effect of the adjustments to 
the portfolio overall is expected to result in a write-down of approximately 
€2.7 million in respect of the portfolio, which currently totals approximately 
€568 million, and a charge to income.  The Company is therefore revising its 
target dividend for the quarter ended December 31, 2006 from €0.27 per share to 
€0.22 to €0.23 per share.  In light of these adjustments, the Company is also 
revising its dividend target for the quarter ended March 31, 2007 to €0.22 to 
€0.25 per share.  The Company's dividend target for the financial year ended 
March 31, 2008 is not less than €1.00, which is consistent with the original 
target dividend for the Company's first full financial year set at the time of 
the Company's IPO in December 2005.

The investment manager intends to maintain the portfolio's geographic 
diversification and to further enhance its product diversification by increasing 
the portion of the portfolio invested in European SME loan transactions.  The 
Company's investment objective remains to preserve capital and to provide stable 
returns to its shareholders in the form of quarterly dividends.

Conference call details:
The conference call at 2pm London time on March 6, 2007 can be accessed by 
dialling [phone] or [phone] from the US ten minutes prior to 
the scheduled start of the call; please reference Queen's Walk Investment 
Limited Financial Results.

A webcast of the conference call will be available to the public on a 
listen-only basis at www.queenswalkinv.com.  Please allow extra time prior to 
the call to visit the site and download the necessary software required to 
listen to the internet broadcast. A replay of the webcast will be available for 
three months following the call.



For further information please contact:

Investor Relations:
Caroline Villiers [phone]

Cheyne Capital:
Andrea Bonafe [phone]


About the Company:

Queen's Walk Investment Limited is a Guernsey-incorporated investment company
listed on the London Stock Exchange. The Company's investment objective is to
preserve capital and to provide stable returns to shareholders in the form of
quarterly dividends. To achieve this, Queen's Walk invests primarily in a
diversified portfolio of subordinated tranches of asset backed securities,
including the unrated 'equity' or 'first loss' residual income position
typically retained by the banks or other financial institutions which have
originated the loan assets that collateralise a securitisation transaction. The
Company makes such investments where its investment manager, Cheyne Capital
Management (UK) LLP, considers the coupon or cashflows from the investment to be
attractive relative to the credit exposure of the underlying asset collateral.
The Company believes that its investment focus provides equity investors with
exposure to a relatively new investment opportunity in this asset class.


The content of this announcement includes statements that are, or may be deemed
to be, 'forward-looking statements'. These forward-looking statements can be
identified by the use of forward-looking terminology, including the terms
'believes', 'estimates', 'anticipates', 'expects', 'intends', 'may', 'will' or
'should'. They include the statement regarding the target aggregate dividend. By
their nature, forward-looking statements involve risks and uncertainties and
readers are cautioned that any such forward-looking statements are not
guarantees of future performance. The Company's actual results and performance
may differ materially from the impression created by the forward-looking
statements. The Company undertakes no obligation to publicly update or revise
forward-looking statements, except as may be required by applicable law and
regulation (including the Listing Rules).


Any target dividends are based on certain assumptions as to future events which
may not prove to be realised. Due to the uncertainty surrounding these future
events, the targets are not intended to be and should not be regarded as profits
or earnings forecasts. There can be no assurance that these targets will be
achieved or that the Company will be able to pay dividends at the target levels
or at all. The payment of any target dividends is subject to the Company
generating sufficient profits or having sufficient retained earnings and there
can be no assurance that this will be the case. Any target dividends that the
Company may announce from time to time should not be regarded as providing any
guidance regarding the level of the Company's distributable net income for any
period.    The Company may revise its dividend policy from time to time.



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