Ameritrans Reports Fourth Quarter and Fiscal Year June 30, 2005 Results

Ameritrans Capital Corporation (NASDAQ: AMTC, AMTCP)
today reported financial results for the fiscal year and quarter ended
June 30, 2005. For the quarter ended June 30, 2005, investment income
was $2.19 million compared to $1.34 million during the prior
comparable period. Investment income for the quarter ended June 30,
2005 included interest income, fee income and leasing income totaling
$1,451,111 and net gain on sale of securities of $738,874 totaling to
$2.19 million.
   For the fiscal year ended June 30, 2005, Ameritrans reported
investment income of $6.13 million as compared to $5.63 million for
the prior year. The increase in reported investment income for fiscal
year ending June 30, 2005 is attributable primarily to the result of
an increase in the net gain on the sale of securities of $688,874 for
the fiscal year. Interest income, fee income and leasing income
totaled $5,443,192 during fiscal year ended June 30, 2005 as compared
to $5,633,827 for fiscal year ended June 30, 2004. The reduction in
interest income, fee income and leasing income was primarily due to a
reduction in interest income of $423,787 due to the impact of lower
average interest rates charged on new and modified loans, partially
offset by an increase in other fees of $141,039 and leasing income of
$92,113.
   Ameritrans reported a net income available to common shareholders
for the quarter ended June 30, 2005 of $200,627, or $0.09 per basic
and diluted common share, versus a net loss of ($87,721), or ($0.04)
per basic and diluted common share, in the fourth quarter of fiscal
2004. The increase in the net income for the year ended June 30, 2005
was attributable primarily to a gain on the sale of securities of
$688,874. For the fiscal year ended June 30, 2005, Ameritrans reported
a net loss to common shareholders of ($224,726), or ($0.11) per basic
and diluted common share, versus net loss of ($704,683) or ($0.35) per
basic and diluted common share for fiscal year 2004. The net loss to
common shareholders in fiscal years ended June 30, 2005 and June 30,
2004 was calculated after taking into account payment of preferred
dividends to preferred shareholders of $337,500 in each fiscal year.
   Operating income in the fourth quarter of fiscal year ended June
30, 2005 was $285,289 as compared to operating income in the fourth
quarter of fiscal year ended June 30, 2004 of $2,647.
   The Company's loan portfolio at June 30, 2005 was $51.9 million
versus $49.4 million at June 30, 2004.
   President of Ameritrans, Gary C. Granoff stated, "Financial
results during 2005 were positively impacted by the gain on sale of
securities during the fourth quarter of 2005. During the first six
months of fiscal year ending June 30, 2005, the Company's operating
income (loss) was $87,177 for the first fiscal quarter and ($326,432)
for the second fiscal quarter. For the second half of the fiscal year,
the Company's third fiscal quarter operating income was $41,808 and
its fourth fiscal quarter operating income was $285,289. The
improvement in operating income primarily resulted from reductions in
write off and depreciation on interest receivable of $ 295,535, as
well as a reduction in foreclosure expenses of $275,176 added to net
gain on sale of securities of $688,874 and increase of fee income of
$141,039 partially offset by reductions in interest income of $423,787
and increases in interest expense of $394,217."
   Granoff went on to say: "During the fiscal year we made
substantial progress in our Chicago taxi portfolio by selling 13
foreclosed medallions and executing contracts of sale to sell 5 of our
leased medallions, and 20 additional foreclosed medallions. Closings
on 20 of the medallions under contract of sale at June 30, 2005 took
place on August 31, 2005. The number of foreclosed medallions in
Chicago has stabilized and at the present time we have approximately
15 additional foreclosed medallions to sell, with active discussions
taking place at this time with potential buyers. We believe that the
Chicago taxi market and the local economy have improved which in turn
has improved our current business and prospects for future business in
that market. At August 31, 2005, the balance of our medallion loans in
New York, Boston and Miami are operating without any loans being in
excess of 90 days delinquent and without any foreclosures in any of
those markets. Our commercial loan portfolio is also performing well
at the present time and we are continuing to build that portfolio with
all new loans being made with adjustable interest rate terms. We also
will continue to seek favorable equity investment transactions to
augment our loan activity. During the fiscal year ended June 30, 2005
the equity investment in a hotel in Arlington, Virginia was
liquidated, resulting in a positive impact on our financial results
for the year."

   Ameritrans Capital Corporation is a specialty finance company
engaged in making loans to and investments in small businesses.
Ameritrans' wholly owned subsidiary Elk Associates Funding Corporation
was licensed by the United States Small Business Administration as a
Small Business Investment Company (SBIC) in 1980. The company
maintains its offices at 747 Third Avenue; 4th Floor; New York, NY
10017.

   This announcement contains forward-looking statements within the
meaning of the Private Securities Litigation Reform Act of 1995. Such
statements are subject to certain risks and uncertainties that could
cause actual results to differ materially from those presently
anticipated or projected. Ameritrans Capital Corporation cautions
investors not to place undue reliance on forward-looking statements,
which speak only as to management's expectations on this date.
-0-
*T
AMERITRANS CAPITAL CORPORATION AND SUBSIDIARIES
----------------------------------------------------------------------

CONSOLIDATED BALANCE SHEETS

June 30, 2005 and 2004

----------------------------------------------------------------------

                                               2005          2004
                                            ------------  ------------

Assets
------

Loans receivable                            $52,060,254   $49,900,989
Less unrealized depreciation on loans
 receivable                                    (150,000)     (509,770)
                                            ------------  ------------
        Loans receivable, net                51,910,254    49,391,219

Cash and cash equivalents                       327,793       416,600
Accrued interest receivable, net of
 unrealized depreciation of $59,000
 in 2005 and $30,500 in 2004                    756,701       969,912
Assets acquired in satisfaction of loans        384,528     1,421,723
Receivables from debtors on sales of assets
 acquired in satisfaction of loan               455,184       422,158
Equity securities                               908,457     1,038,617
Furniture, equipment and leasehold
 improvements, net                              329,573       439,262
Medallions under lease                        2,282,201     2,382,201
Prepaid expenses and other assets               531,904       610,214
                                            ------------  ------------

        Total assets (Note 8)               $57,886,595   $57,091,906
                                            ============  ============
*T

-0-
*T
AMERITRANS CAPITAL CORPORATION AND SUBSIDIARIES
----------------------------------------------------------------------

CONSOLIDATED BALANCE SHEETS (Continued)

June 30, 2005 and 2004
----------------------------------------------------------------------

                                                    2005         2004
                                             ------------ ------------

Liabilities and Stockholders' Equity
------------------------------------

Liabilities:
  Debentures payable to SBA                  $12,000,000  $12,000,000
  Notes payable, bank                         29,770,652   28,908,652
  Accrued expenses and other liabilities         604,942      578,790
  Accrued interest payable                       256,285      271,630
  Dividends payable                               84,375       84,375
                                             ------------ ------------

        Total liabilities                     42,716,254   41,843,447
                                             ------------ ------------

Commitments and contingencies

Stockholders' equity:
  Preferred stock 500,000 shares authorized,
   none issued or outstanding                          -            -
  9-3/8% cumulative participating redeemable
   preferred stock $.01 par value, $12.00
   face value, 500,000 shares authorized;
   300,000 shares issued and outstanding       3,600,000    3,600,000
  Common stock, $.0001 par value; 5,000,000
   shares authorized, 2,045,600 shares
   issued, 2,035,600 outstanding                     205          205
  Additional paid-in capital                  13,869,545   13,869,545
  Accumulated deficit                         (2,127,134)  (1,902,408)
  Accumulated other comprehensive loss          (102,275)    (248,883)
                                             ------------ ------------
        Total                                 15,240,341   15,318,459
  Less: Treasury stock, at cost,
    10,000 shares of common stock                (70,000)     (70,000)
                                             ------------ ------------


        Total stockholders' equity            15,170,341   15,248,459
                                             ------------ ------------

        Total liabilities and stockholders'
         equity                              $57,886,595  $57,091,906
                                             ============ ============
*T

-0-
*T
AMERITRANS CAPITAL CORPORATION AND SUBSIDIARIES
----------------------------------------------------------------------

CONSOLIDATED STATEMENTS OF OPERATIONS

Years Ended June 30, 2005, 2004 and 2003
----------------------------------------------------------------------

                                      2005        2004        2003
                                   ----------- ----------- -----------
Investment income:
 Interest on loans receivable      $4,771,954  $5,195,741  $6,072,399
 Gain on sale of equity securities,
  net (Note 4)                        688,874       5,665       2,976
 Fees and other income                459,598     318,559     209,680
 Leasing income                       211,640     119,527           -
                                   ----------- ----------- -----------
     Total investment income        6,132,066   5,639,492   6,285,055
                                   ----------- ----------- -----------
Operating expenses:
 Interest                           1,837,633   1,443,416   2,076,861
 Salaries and employee benefits     1,128,963   1,022,964     879,074
 Occupancy costs                      188,466     207,079     144,279
 Professional fees                    675,399     605,168     575,022
 Other administrative expenses      1,162,457   1,250,435     963,175
 Loss and impairments on both
  medallions under lease and assets
  acquired in satisfaction of
  loans, net                          198,177      44,362      77,343
 Foreclosure expenses                  87,695     362,871     313,678
 Write off and depreciation on
  interest and loans receivable       728,710   1,024,245     852,512
                                   ----------- ----------- -----------
     Total operating expenses       6,007,500   5,960,540   5,881,944
                                   ----------- ----------- -----------
     Operating income (loss)          124,566    (321,048)    403,111
                                   ----------- ----------- -----------
Other expense:
 Equity in loss of investee            (4,021)    (29,634)          -
 Loss on sale of automobile               (60)          -           -
                                   ----------- ----------- -----------
     Total other expense               (4,081)    (29,634)          -
                                   ----------- ----------- -----------
     Income (loss) before income
      taxes                           120,485    (350,682)    403,111
Income taxes                            7,711      16,501       7,897
                                   ----------- ----------- -----------
     Net income (loss)                112,774    (367,183)    395,214
Dividends on preferred stock         (337,500)   (337,500)   (337,500)
                                   ----------- ----------- -----------
     Net income (loss) available to
      common shareholders           $(224,726)  $(704,683)    $57,714
                                   =========== =========== ===========

Weighted Average Number of Common
 Shares Outstanding:
 Basic                              2,035,600   2,035,600   2,035,600
                                   =========== =========== ===========
 Diluted                            2,035,600   2,035,600   2,035,600
                                   =========== =========== ===========

Net Income (Loss) Per Common Share:
 Basic                                 $(0.11)     $(0.35)      $0.03
                                   =========== =========== ===========
 Diluted                               $(0.11)     $(0.35)      $0.03
                                   =========== =========== ===========
                                       2005        2004        2003
                                   ----------- ----------- -----------

Net income (loss)                    $112,774   $(367,183)   $395,214

Other comprehensive income (loss):
 Unrealized gain (loss) on equity
  securities arising during the
  period                               46,583     (13,338)   (200,338)
 Reclassification adjustment for
  (gain) loss included in net
  income (loss)                       100,025      (5,665)          -
                                   ----------- ----------- -----------
     Total comprehensive income
      (loss)                         $259,382   $(386,186)   $194,876
                                   =========== =========== ===========
*T