C.A. Bancorp Inc.

C.A. Bancorp Inc.
C.A. Bancorp Canadian Realty Finance Corporation

December 27, 2007 15:32 ET

C.A. Bancorp Inc. (TSX:BKP) Files Preliminary Prospectus for C.A. Bancorp Canadian Realty Finance Corporation Tax-Efficient 6.75% Yielding Preferred Shares

TORONTO, ONTARIO--(Marketwire - Dec. 27, 2007) - C.A. Bancorp Inc. ("C.A. Bancorp") (TSX:BKP) is pleased to announce that a preliminary prospectus for a newly created mutual fund corporation, C.A. Bancorp Canadian Realty Finance Corporation (the "Corporation"), has been filed with, and a receipt therefor issued by, the securities regulatory authorities in each of the provinces and territories of Canada. The Corporation is offering and will issue preferred shares, Series 1 (the "Preferred Shares") to the public.

Offering Price and Minimum Purchase

The Offering price for the Preferred Shares is $25.00 per share. The minimum purchase quantity is 100 Preferred Shares ($2,500).

Investment Objectives

The Corporation's investment objectives with respect to the Preferred Shares are to:

i. provide preferred shareholders with fixed cumulative preferential quarterly cash distributions in the amount of $0.4219 per Preferred Share (except for the first distribution), representing a yield on the issue price of 6.75% per annum; and

ii. return the original issue price of the Preferred Shares at the end of 10 years.

The first distribution on the Preferred Shares will be $0.105 per Share. The quarterly distributions on the Preferred Shares are expected to primarily comprise returns of capital or capital gains.

The Corporation

The Corporation has been created to obtain exposure to the investment performance of an actively managed portfolio of secured loans and investments in the Canadian commercial real estate sector on a tax efficient basis.

C.A. Bancorp's Commitment

Upon closing of the Offering, C.A. Bancorp will subscribe for Class A shares of the Corporation such that the net proceeds of the issuance of the Class A shares, after deducting the expenses of the Offering, equal at least 11.1% of the gross proceeds of the Offering. On the closing of the Offering, C.A. Bancorp will be the sole holder of Class A shares, which will rank subordinate to the Preferred Shares. Additionally, C.A. Bancorp will, in effect, be funding all issuance and marketing costs associated with this Offering. C.A. Bancorp has also agreed to subscribe, or arrange subscriptions, for additional Class A shares on a quarterly basis such that the net asset value of the Corporation less deferred issue expenses plus the original issue price of the outstanding Preferred Shares (the "Original Preferred Share Issue Price") will not be less than 111% of the Original Preferred Share Issue Price.


The syndicate of agents is co-led by TD Securities Inc. and CIBC World Markets Inc. and includes BMO Nesbitt Burns Inc., National Bank Financial Inc., Scotia Capital Inc., Canaccord Capital Corporation, HSBC Securities (Canada) Inc., Raymond James Ltd., Blackmont Capital Inc., Dundee Securities Corporation, Wellington West Capital Inc., Desjardins Securities Inc., GMP Securities L.P., Research Capital Corporation and Richardson Partners Financial Limited.

C.A. Bancorp Inc.

C.A. Bancorp is a publicly traded Canadian merchant bank and alternative asset manager that provides investors with access to a range of private equity and other alternative asset class investment opportunities. C.A. Bancorp is focused on investments in small- and middle-capitalization public and private companies, with emphasis on the industrials, real estate, infrastructure and financial services sectors.

Certain statements included in this news release constitute forward-looking statements including those identified by the expressions, "will", "anticipate", "believe", "plan", "estimate", "expect", "intend" and similar expressions. The forward looking statements are not historical facts but represent C.A. Bancorp's current expectations regarding future results or events. These forward-looking statements are subject to a number of risks and uncertainties that could cause actual results or events to differ materially from current expectations, including the matters discussed in the "Risk Factors" and others sections of the preliminary prospectus of the Corporation and including, interest rate fluctuations, the availability of investments, competition, levels of return earned on the underlying portfolio of investments, change in financial position of the Corporation or C.A. Bancorp, reliance on key personnel, ability of the Corporation to meet its investment objectives, the ability of the Corporation to pay quarterly distributions, and the ability of C.A. Bancorp to subscribe for or obtain subscriptions for Class A shares of the Corporation. Due to the many risks and uncertainties, C.A. Bancorp cannot assure that the forward-looking statements contained in this news release will be realized.

A preliminary prospectus dated December 21, 2007 relating to these securities has been filed with the securities regulatory authority in each of the provinces and territories of Canada, but has not yet become final for the purpose of the sale of securities to the public. This news release shall not constitute an offer to sell or the solicitation of an offer to buy nor shall there be any sale or any acceptance of an offer to buy these securities in any province or territory of Canada prior to the time a receipt for the final prospectus is obtained from such securities regulatory authorities. Important information concerning this offering is contained in the prospectus. Obtain a copy from your financial advisor and read the prospectus before investing.

The Exchange Tower
130 King Street West
Suite 2850, P.O. Box 104
Toronto, Ontario M5X 1A4

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