First Trust/FIDAC Mortgage Income Fund Releases Monthly Distribution Payable On 15 January 2009

First Trust FIDAC Mortgage Income Fund introduces monthly distribution and special distribution both payable on 15 January 2009 to shareholders of record as of 31 December 2008, with an expected ex dividend date of 29 December 2008. Special distribution is

By None

First Trust/FIDAC Mortgage Income Fund introduces monthly distribution and special distribution both payable on 15 January 2009 to shareholders of record as of 31 December 2008, with an expected ex-dividend date of 29 December 2008. Special distribution is $0.05 per common share.

First Trust/FIDAC Mortgage Income Fund (FMY):

Monthly Distribution per share:

$0.11

Distribution Rate based on 19 December 2008 NAV of $16.17:

8.16%

Distribution Rate based on 19 December 2008 closing market price of $16.22:

8.14%

The majority, and possibly all, of this distribution will be paid out of net investment income earned by the Fund. A portion of this distribution may come from net short-term realized capital gains or return of capital. The final determination of the source and tax status of all 2008 distributions will be made after the end of 2008.

L.D.

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