First Trust/Highland Capital Floating Rate Income Fund Suspension of Monthly Distributions

    TSX Symbol FHT.UN

    TORONTO, May 21 /CNW/ - First Trust/Highland Capital Floating Rate Income
Fund (the "Fund") announces the suspension of monthly distributions effective
    FT Floating Rate Management Inc. the manager of the Fund (the "Manager")
has concluded that it is necessary to suspend monthly distributions as a
result of a decline in the Fund's cash flow available for distribution.
Several factors have negatively impacted the Fund's cash flow including lower
interest rates, a reduction in the Fund's total assets, a strengthening
Canadian dollar vis a vis the U.S. currency and a higher management expense
    As previously reported, the Fund's total assets have decreased
significantly during the past twelve months. The decline can be attributed to
the annual redemption in the first quarter of this year; termination of the
Fund's leverage facility effective February 16th, 2009 and a decline in the
market prices of the underlying loan portfolio. In addition to the reduction
in total assets, the Fund's loan portfolio has also experienced a modest
decline in quality since December 31, 2008 as a result of weaker credit
ratings and an increasing default rate. The weighted average credit rating as
of December 31, 2008 was B1/B2 and as of May 15, 2009 was B2/B3. Additionally,
as of May 15 of this year 5 of the 23 holdings in the loan portfolio were in
default, however, this only represented approximately 3.5% of the Fund's total
net asset value at this date.
    The Manager will continue to monitor the Fund's cash flow in order to
determine the amount of distributions, if any, in a particular calendar month.

For further information:

For further information: First Defined Portfolio Management Co., (416)
865-8065 or 1-877-622-5552.

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