Trading Update

Queen's Walk Investment Limited
28 February 2006


                                                                28 February 2006



                        Queen's Walk Investment Limited


         Strong initial performance, target dividend increased by 20 %



Ahead of the announcement of its financial results for the period ended 31st
March 2006, Queen's Walk Investment Limited (the 'Company') confirms that it has
exceeded the initial investment targets set at the Company's IPO in December
2005 when it raised Euro 406 million. Specifically:


   •The pace of investment has exceeded the Company's targets, with the
    portfolio now fully invested one month ahead of plan.


   •The Company's investment portfolio has performed at, or better than,
    initial expectations and the investment yield on new primary investments
    remains attractive.


   •The portfolio has been further diversified geographically, with new
    investments undertaken in Italy, The Netherlands and Germany. The Company is
    also evaluating investments in new asset classes. While the Company has made
    limited investments in one such asset class (namely, small-to-medium
    enterprise ('SME') loans), the portfolio remains substantially backed by
    residential mortgages.


Given that both the timing of the ramp-up of the Company's investment portfolio
and the portfolio's performance have exceeded the Company's assumptions, the
Company has raised its target aggregate dividend for the period ending 31st
March 2006 to Euro 0.24 per share from its previous target of Euro 0.20.


The Company continues to build its origination capabilities and is well advanced
in fulfilling its strategic aim of building a Pan-European asset sourcing
franchise. The Company seeks to build long-term partnerships with new asset
originators while continuing to enhance its existing relationships. Of the new
transactions that the Company has entered since the IPO, three quarters of them
have been with new originator partners. The Company's progress in building this
asset sourcing franchise has increased the visibility of its transaction
pipeline for the coming year and leaves it well positioned for future growth.


Notwithstanding the ramp-up of the portfolio ahead of target, the Company
continues to see attractive investment opportunities. In order to ensure that it
has sufficient flexibility to pursue these opportunities and thereby enhance
shareholder returns, the Company is in the process of negotiating a series of
investment and warehouse financing arrangements with leading financial
institutions.


Commenting on the performance to date, Cheyne Capital's Syd Hanna said,

'Queen's Walk has had a successful start and its performance has exceeded our
initial expectations. The Company has delivered on its initial investment
strategy and enhanced returns while simultaneously diversifying its portfolio.
Queen's Walk has also continued to build on the foundations of its significant
Pan-European asset origination franchise. Taken together, we believe these
developments should enable Queen's Walk to deliver even more attractive
shareholder returns.'


The preliminary results for the Company's initial financial period ending 31st
March 2006 will be announced in May.



For further information please contact:

Investor Relations:       Andrea Bonafe [phone]

Cheyne Capital:           Syd Hanna [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 Limited, 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 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). There can be no assurance that the
Company will be able to pay dividends at the targeted level, or at all. The
Company may revise its dividend policy from time to time.





ENDS




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