McLean, VA: Gladstone Capital Corp. (NASDAQ: GLAD) announced today its end-of-the-fiscal-year financial statement for September 30, 2001. The company was started in May 2001 and had its initial public offering in August 2001 so the year-end numbers are for a very short period.

For the stub period ending September 30, 2001, the Net Operating Loss was $93,000 or $0.03 per share. Total assets were $132,000,000 at September 30, 2001 and Net Asset Value per share was $13.05.

In addition, the company said that it had closed the following loans and investments as of December 31, 2001.

1. Finn Corporation Term Loan for $10,500,000
   

2. Finn Corporation Warrant for $37,000
   

3. Marcal Corporation Term Loan for $7,500,000
   

4. Marcal Corporation Mortgage for $9,000,000
   

5. NextiraOne Corporation Term Loan for $7,000,000
   

6. NextiraOne Corporation Line of Credit for $8,000,000
   

7. American Remanufacturing, Inc. Loan for $8,000,000

More information about each of these companies will be available on the company's web site: www.GladstoneCapital.com

The amount of funds invested in the quarter ending December 31, 2001 was "disappointing" said a company spokesperson. The company had expected to complete more investments, but given the current economic climate it seemed prudent to proceed carefully. The company said that the number of loan opportunities has not diminished, but the poor economy has caused the company to exercise added caution.

The company expects to report added information about the quarter ending December 31, 2001 in mid-February 2002. The company recently declared a quarterly cash dividend of $0.18 per share payable on January 15, 2002.

For Further Information Contact Harry Brill or David Gladstone at 703 286 7000

This press release may include statements that may constitute "forward-looking statements" within the meaning of Section 27A of the Securities Act of 1933, as amended, and Section 21E of the Securities Exchange Act of 1934, as amended, including statements with regard to the future performance of the Company. Words such as "believes" and "future" or similar expressions are intended to identify forward-looking statements. These forward-looking statements inherently involve certain risks and uncertainties, although they are based on the Company's current plans that are believed to be reasonable as of the date of this press release. Factors that may cause the Company's actual results, levels of activity, performance or achievements to be materially different from any future results, levels of activity, performance or achievements expressed or implied by such forward-looking statements include, among others, those factors listed under the caption "Risk factors" of the Company's prospectus dated August 23, 2001, as filed with the Securities and Exchange Commission on August 24, 2001. The Company undertakes no obligation to publicly update or revise any forward-looking statements, whether as a result of new information, future events or otherwise.