DBRS Confirms Series 1 Shares and Downgrades Series 2 Shares Issued by High Income Preferred Shares Corp.

Dominion Bond Rating Service (“DBRS”) has today confirmed the rating of Pfd-1 (low) with a Stable trend to the Series 1 Shares issued by High Income Preferred Shares Corp. (the “Company") and downgraded the Series 2 Shares to Pfd-2 (low). The current ratings on both series of Preferred Shares is based on the 100% coverage of the principal amount of the Series 1 Shares provided by the Series 1 Forward Agreement, the declining asset coverage of 1.46 (as of December 30, 2005) available to the Series 2 Shares, and the amount of capital available to generate income and pay dividends to both Series 1 and Series 2 Shares.

Holders of the Series 1 Shares are entitled to receive monthly distributions of Cdn$0.1218 per share in an amount that will provide for an annual yield of 5.85%. The holders of Series 2 Shares are entitled to receive monthly distributions of Cdn$0.0888 per share to yield 7.25% annually. The termination date in respect of each class of shares is set on June 29, 2012. Approximately 32% of the net proceeds from the offering were used to enter into an agreement with Canadian Imperial Bank of Commerce (the “Counterparty”) wherein the Counterparty are payed the Original Investment Amount per Series 1 Share outstanding on the termination date. The remainder of the proceeds from the offering were invested in a portfolio comprising bonds and common shares issued by companies that form a part of the North America’s equity Indexes and up to 50% in Income Trusts.