American Strategic Income Portfolio Inc. (“ASP”), American Strategic Income Portfolio Inc. – II (“BSP”), American Strategic Income Portfolio Inc. – III (“CSP”) and American Select Portfolio Inc. (“SLA”) announced today that they have reached an agreement in principle with a third party lender to obtain four separate credit facilities that would be sufficient to refinance in full all amounts outstanding under the funds’ current loan agreements with Morgan Stanley Mortgage Capital Holdings LLC (“Morgan Stanley”). ASP, BSP, CSP and SLA have outstanding borrowings under their current loan agreements of $5,000,000, $32,500,000, $49,000,000 and $30,500,000, respectively. Such amounts are due and payable on July 15, 2008, except that a $20,000,000 prepayment is due on or before July 7, 2008, unless the funds have entered into a binding commitment by July 3, 2008 to obtain financing sufficient to repay amounts outstanding under the loan agreements. Because of the agreement in principle reached by the funds, the funds do not anticipate that Morgan Stanley will enforce this prepayment provision. The funds expect to close on the credit facilities prior to July 15, 2008, although there can be no assurance that this will occur.

If the funds are unable to close on the credit facilities by July 15, 2008, they will be required, absent further extensions, to satisfy the balance of their repayment obligations to Morgan Stanley by selling loans in their portfolios. Such sales may be disadvantageous in the current market. Furthermore, if the funds are unable to leverage their portfolios to the same extent and on terms as favorable as in the past, yields to common shareholders can be expected to decline.

Based in Minneapolis, FAF Advisors, Inc., a subsidiary of U.S. Bank National Association, serves as the investment advisor to the funds. It provides investment management services to individuals and institutions–including corporations, foundations, pension funds, public funds, and retirement plans–and had combined assets under management or administration of more than $113 billion as of March 31, 2008.

U.S. Bank National Association is a separate entity and wholly owned subsidiary of U.S. Bancorp, the sixth-largest financial services holding company in the United States as of March 31, 2007, and a leading provider of comprehensive banking, trust, investment, and payment systems products and service. U.S. Bancorp is the parent company of U.S. Bank. Visit U.S. Bancorp at usbank.com.

Investment products, including shares of closed-end funds, are not obligations of, or guaranteed by, any bank, including U.S. Bank or any U.S. Bancorp affiliate, nor are they insured by the Federal Deposit Insurance Corporation, the Federal Reserve Board, or any other agency. An investment in such products involves investment risk, including possible loss of principal.

FAF Advisors, Inc.
Investor Services, 800-677-FUND