U.S. Corporate Credit Quality Improves Slightly in November. Troubled Company Index Still Well Above Early 2004 Low Point

HONOLULU, December 1, 2004: Kamakura Corporation reported today that its monthly index of troubled companies in the United States improved slightly in November. The troubled company index remained well above its low point of 11.1% reached in April. Kamakura reported that the troubled company index reached 13.6% of the public company universe in November, down 1.0% from the previous month. Kamakura classifies any company with a default probability of more than one percent as troubled.

"The Kamakura troubled company index has varied from week to week but in general it remains well above the peak in credit quality that we saw in the spring," commented Dr. Donald R. van Deventer, Kamakura Chairman and Chief Executive Officer. "Its movements are consistent with the November 18 announcement from the Conference Board that its index of leading indicators has fallen for five consecutive months. The number of companies with default probabilities between 1% and 5% was 7.8% of the public company universe in November. Companies with default probabilities between 5 and 10% were down slightly at 2.0% for November. Companies with default probabilities between 10% and 20% increased 0.1% to 1.6% of the universe. The riskiest firms in the universe, those with default probabilities over 20%, improved to 2.2% of the universe, a slight decrease of 0.2%."

Kamakura is offering free trials of its KRIS default probability service to qualified institutions. For more information on Kamakura's free trial offer please visit the Kamakura Corporation web site. Additional information can also be found in Advanced Financial Risk Management (John Wiley & Sons, 2004) by Kamakura's van Deventer, Kenji Imai, and Mark Mesler.