Velocity Asset Management Reports Record Revenue and Operating Results for Q3

Velocity Asset Management, Inc., a distressed asset management and liquidation company, announced today revenues and operating results for the quarter and nine months ended September 30, 2006.

For the third quarter ended September 30, 2006, the Company reported record net income of $433,704 or $0.02 per diluted share, a 78.1% increase as compared to net income of $243,477 or $0.01 per diluted share in the third quarter of 2005, and an increase of 116.1% sequentially from second quarter net income of $200,682. Operating income increased 48.9% in the third quarter of 2006 to $1,033,132 as compared to operating income of $694,019 for the third quarter of 2005, and increased 45.2% sequentially as compared to operating income of $711,738 in the second quarter ended June 30, 2006. Third quarter 2006 revenues increased 6.0% to $2,925,131 as compared to revenues of $2,758,285 for the third quarter of 2005, an increase of 36.9% sequentially as compared to revenues of $2,137,290 for the second quarter ended June 30, 2006.

For the nine months ended September 30, 2006, the Company reported revenues of $6,918,576, an increase of 11.1% as compared to revenues of $6,227,436 for the first nine months of 2005. Operating income increased in the first nine months of 2006 to a record $2,158,192 as compared to operating income of $1,209,804 for the first nine months of 2005, an increase of 78.4%. Net income for the first nine months of 2006 increased 45.4% to $703,723 or $0.04 per diluted share, as compared to net income of $484,096 or $0.03 per diluted share in the first nine months of 2005.

During the third quarter of 2006, the Company’s wholly owned Velocity Investments subsidiary posted record gross cash collections from its portfolios of non-performing consumer receivables totaling $2,795,060, an increase of 82.3%, as compared to collections of $1,532,839 in the three-month period ending September 30, 2005. Gross cash collections increased by 127.3% in the first nine months of 2006 to $7,950,156 as compared to $3,497,666 for the first nine months of 2005. During the third quarter of 2006, Velocity Investments purchased consumer receivable portfolios aggregating approximately $67 million in outstanding principal amount for a purchase price of approximately $4.5 million, bringing the aggregate initial outstanding principal amount of consumer receivables under management as of September 30, 2006 to approximately $263 million, an increase of 93.4% as compared to approximately $136 million as of September 30, 2005.

Commenting on the results, Jack Kleinert, President and CEO, stated, “We are very excited about our record operating results for the third quarter of 2006. The substantial percentage increase in the quarter in net income, operating income, gross collections and consumer receivables under management reflects a trend that we believe will continue for the foreseeable future. As the aggregate size of our consumer receivable portfolios under management expands, we also believe that we will see a continued growth in the amount of gross collections and a corresponding acceleration in operating income.”