C.A. Bancorp Inc.
TSX : BKP

C.A. Bancorp Inc.

November 09, 2007 15:27 ET

C.A. Bancorp Inc. (TSX:BKP) Reports Third-Quarter Results; Now Has $300 Million in Assets Invested and Under Management

TORONTO, ONTARIO--(Marketwire - Nov. 9, 2007) - C.A. Bancorp Inc. (the "Company") (TSX:BKP) is pleased to announce continued progress in executing its business plan. The Company believes alternative asset classes such as private equity and real estate provide superior investment opportunities with long-term risk-adjusted rates of return for its shareholders. In the last quarter, the Company:

- Grew its industrials and financial services portfolios with the funding of two private equity investments totalling $12 million.

- Grew its real estate portfolio with the:

i. Establishment of its real estate capital business which includes commercial lending and fee-based commercial mortgage brokering.

ii. Expansion of Charter Real Estate Investment Trust ("Charter REIT"), which completed a $50.8 million treasury offering at price levels accretive to the Company's original cost and closed a real estate acquisition.

- Generated a strong pipeline of investment opportunities across its target sectors (industrials, real estate, infrastructure and financial services), which management believes could yield one to three additional significant investments before the end of the calendar year.

- Brought the total assets it manages for its own balance sheet or for other investors to $300 million.

The Company continues to actively manage its portfolio of direct public investments. There was significant volatility in the credit and equity capital markets during the three months ended September 30th and the volatility continues. This volatility had a negative effect on small cap income trusts in Canada, which constitute a significant portion of the Company's public investments. Management reviews the underlying fundamentals in its investments on an ongoing basis and adjusts its positions based on those reviews.

Aside from its direct public and private investment activities, the Company has been active in evaluating and developing new alternative asset investment funds targeted at institutional and individual investors. Structuring and raising capital for investment funds is a key component of the Company's long-term strategy. Asset management fees generate recurring and predictable revenue streams, creating value for the Company's shareholders. The Company has been actively marketing its Mid-Cap Private Equity Fund ("Mid-Cap Fund") to institutional investors and has received an institutional commitment to date. Marketing to high net worth individual investors has begun.

It is anticipated that real estate loans currently on the Company's balance sheet will be sold to a fund, managed by the Company and available only to accredited investors, providing such investors with the opportunity to receive tax-efficient returns from well-underwritten high yielding mortgages.

Investment highlights

Below are details of the significant achievements of the Company during the third quarter and up to the date of this press release:

- In July, the Company closed its first private equity investment: a $4 million investment in Canadian independent broadcaster High Fidelity HDTV Inc. ("High Fidelity") to support the growth and expansion of High Fidelity's high definition television channels. Of that investment, $2.75 million was funded by the Company and the remaining $1.25 million was funded by Sentry Select Total Strategy Fund ("Total Strategy"). The Company is the Manager of Total Strategy.

- The Company's second private equity investment closed in October. Through a newly created subsidiary, AgriFinancial Canada Corp., the Company completed an $89 million acquisition of the agricultural financial services businesses of Agrifinance and AgriCard. The acquisition will serve as a platform for the Company in the financial services sector. The Company invested $9.5 million, with an additional $1.0 million provided by Total Strategy.

- As of September 30, 2007, the Company had five real estate loans outstanding, totaling $2.9 million. The loans have a weighted average interest rate of 11.14% and an expected weighted average maturity of approximately six months. Since the quarter-end the Company made an additional two loans, bringing total value of the loans outstanding to $4.9 million.

- Charter REIT, which is managed by the Company, completed a treasury offering raising approximately $50.8 million. This capital gives Charter REIT the ability to acquire additional real estate properties which in turn increases the acquisition and management fees paid to the Company by Charter REIT.

Q3 results

The Company's consolidated financial results for the third quarter ending September 30, 2007 are as follows:

- Total revenue (excluding net realized and unrealized gains on direct public investments) comprised of interest and investment income, asset management fees, revenue from rental properties and other fees and commissions for the third quarter of $2,484,000 (2006 - $71,000) and year-to-date of $5,494,000 (2006 - $121,000).

- Realized gains on the sale of investments for the third quarter of $318,000 (2006 - gain of $3,000) and year-to-date of $1,441,000 (2006 - gain of $4,000).

- Unrealized loss on direct public investments for the third quarter of $2,531,000 (2006 - unrealized loss of $161,000) and year-to-date of $2,490,000 (2006 - unrealized loss of $197,000). The unrealized loss was largely a result of the weakness in the small capitalization income trust sector.

- The Company reported a net loss of $1,085,000 for the third quarter (2006 - net loss of $428,000) or $0.04 (2006 - loss of $0.04) per common share on a basic and fully diluted basis and year-to-date net income of $381,000 (2006 - net loss of $818,000) or $0.02 (2006 - net loss of $0.08) per common share on a basic and fully diluted basis.

- As of September 30, 2007, the Company's net book value per share was $2.88 and the closing price on the Toronto Stock Exchange (the "TSX") on September 28, 2007 (the last day of trading for the third quarter) was $2.28 per share. This represented a trading discount to net book value of 20.8%.

The Company instituted a normal course issuer bid on August 10, 2007 and has sought to purchase shares in the open market for cancellation from treasury. Any such purchases will be made by the Company at the prevailing market price at the time of such purchases in accordance with the requirements of the TSX. As of November 7, 2007 the Company had purchased 245,100 shares for cancellation at an average price of $2.48.

Quarterly conference call

A conference call has been scheduled for Tuesday, November 13, 2007 at 4:15 p.m. EST where management will discuss third-quarter results and provide an update on current business activities.

To participate in the call, please dial 416-641-6119 or 1-866-300-4047. A recording of the conference call will be available for replay until Thursday, December 13, 2007, by dialing 416-695-5800 or 1-800-408-3053, pass code: 3240403#.

Q3 financial results

For the complete third quarter of 2007 Management's Discussion and Analysis, and Consolidated Financial Statements, please visit www.SEDAR.com.

C.A. Bancorp Inc.

C.A. Bancorp Inc. 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. The Company 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.

This news release contains forward-looking statements with respect matters concerning the business, operations, and strategy of the Company. These statements relate to anticipated future events, results, circumstances, performance or expectations that are not historical facts but instead represent the Company's beliefs regarding future events. Often, but not always, forward-looking statements can be identified by the use of forward-looking words such as "will", "expect", "intend", "plan", "estimate", "anticipate", "believe" or "continue", similar words or the negative thereof, or variations of such words and phrases that certain actions, events or anticipated outcomes "may", "would" or "might" be taken, occur or be achieved. There can be no assurance that the plans, intentions or expectations upon which these forward-looking statements are based will occur. The future business, operations and performance of the Company discussed herein could differ materially from those expressed or implied by such statements. Such forward-looking statements are qualified in their entirety by the inherent risks and uncertainties surrounding future expectations. Forward-looking statements are based on a number of assumptions which may prove to be incorrect. Additional, important factors that could cause actual results to differ materially from expectations include, among other things, general economic and market factors. The Company cautions that risk factors discussed in applicable continuous disclosure filings required by law that the Company has made and filed on SEDAR should also be considered carefully and that undue reliance not be placed on forward-looking statements as events and results could differ materially from those expressed or implied by forward-looking statements made by the Company. The cautionary statements qualify all forward-looking statements attributable to the Company and persons acting on its behalf. Unless otherwise stated, all forward looking statements speak only as of the date of this press release. The Company does not undertake, and specifically disclaims, any intention or obligation to update or revise any forward-looking statements, whether as a result of new information, future events or otherwise, unless required by applicable law.



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