HSM Helios Strategic Mortgage Income Fund (The) Common Stock

The Board of Directors of The Hyperion Brookfield Strategic Mortgage Income Fund, Inc. (the "Fund") (NYSE: HSM) declared a monthly dividend of $0.0725 per share, payable on December 24, 2008 to stockholders of record on December 16, 2008. The ex-dividend date is December 12, 2008. Based on the NYSE closing price of $4.54 on December 4, 2008, the Fund's yield was 19.16%. As of November 30, 2008, the Fund's average duration, as measured on a net asset basis, was 4.7 years. Separately, the Fund announced that it will not make any capital gains distributions in December 2008.

Dividends may include net investment income, capital gains and/or return of capital. The dividend yield referenced above is calculated as the annualized amount of the most recent monthly dividend declared divided by the stated stock price.

        Portfolio of Investments as of November 30, 2008
        Sector Allocation as a Percentage of Total Assets

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Non-Agency Residential Mortgage-Backed Securities ("MBS")              32%
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Commercial MBS                                                         16%
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Agency MBS                                                             31%
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Asset-Backed Securities                                                 2%
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U.S. Treasury Securities                                               18%
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Other                                                                   1%
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         Credit Allocation as a Percentage of Total Assets

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U.S. Government / Agency and AAA Rated                                 77%
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AA Rated                                                                3%
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A Rated                                                                 4%
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BBB Rated                                                              11%
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Below Investment Grade                                                  5%
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The Fund uses its web site as a channel of distribution of material company information. Financial and other material information regarding the Fund is routinely posted on and accessible at www.hyperionbrookfield.com/strategies/retail_funds.htm.

The Hyperion Brookfield Strategic Mortgage Income Fund, Inc. is managed by Hyperion Brookfield Asset Management, Inc., a registered investment advisor located in New York City. The firm was founded in 1989 to provide relative value driven fixed income investment strategies, such as core fixed income, high yield, and specialized MBS. Hyperion Brookfield manages in excess of $19 billion for a client base including pension funds, financial institutions, mutual funds, insurance companies and foundations. Hyperion Brookfield is a subsidiary of Brookfield Asset Management Inc., a global asset manager focused on property, power and other infrastructure assets with approximately $90 billion of assets under management.

Contacts: The Hyperion Brookfield Strategic Mortgage Income Fund, Inc. Three World Financial Center 200 Vesey Street, 10th Floor New York, NY 10281-1010 1-800-HYPERION