Connor, Clark & Lunn Capital Markets Inc.

Connor, Clark & Lunn Capital Markets Inc.

January 23, 2007 08:00 ET

CC&L Tax-Efficient Notes 'TEN' Make Their Debut

TORONTO, ONTARIO--(CCNMatthews - Jan. 23, 2007) - Connor, Clark & Lunn Capital Markets Inc. (CC&L Capital Markets) is pleased to announce the launch of CC&L Tax-Efficient Notes(TEN). Designed for non-registered income portfolios, the R.O.C. Yield Class™. Notes use Return of Capital (R.O.C.™) to create tax-efficient potential distributions compared to traditional fixed income investments, while the Total Return Class Notes provide the power of compounding by reinvesting potential distributions for additional capital appreciation.

The BMO CC&L Bond Deposit Notes Series 1 (the Notes) are the first offering of CC&L Tax-Efficient Notes(TEN) and are linked to the top-performing CC&L Core Plus Bond Fund (the Fund). Connor, Clark & Lunn Investment Management Ltd., provides investment management for the Fund. The Fund has been a consistent top quartile performer over the last five years, based on its strong record of generating superior returns on both an absolute and relative basis (past performance of the Fund is not a guarantee of return, if any, on the Notes).

Issued by Bank of Montreal, the Notes are available in two classes:

R.O.C. Yield Class: Designed for investors seeking monthly cash flow, distributions will be calculated at a rate equal to 75% of the net distribution rate of the Fund, and paid monthly as a return of capital. There is no tax on return of capital distributions - instead, the adjusted cost base of the Notes will be reduced. The average annualized monthly net distribution rate of the Fund for the 12 months ending November 30, 2006 of 5.15% would have resulted in average annualized R.O.C. Yield Class distributions of 3.87% (past performance of the Fund is not a guarantee of return, if any, on the Notes). Excess returns remain invested for growth.

Total Return Class: Designed for investors seeking to maximize growth in a tax-efficient manner from an income investment. Returns remain invested to further enhance growth potential, and should not trigger a current-year tax liability.

"Exposure to high performing fixed income assets is prudent for any well diversified portfolio," says Neil Murdoch, Chief Executive Officer of CC&L Capital Markets. "Unfortunately, high tax rates on traditional fixed income securities can reduce their effectiveness for taxable portfolios. We're excited to offer a solution that has the potential to leave more after-tax money in the hands of investors."

According to Peter Loach, VP and Managing Director of Fund Research at BMO Nesbitt Burns, "For taxable investors, the CC&L Bond Deposit Note is an effective alternative to traditional bond funds or for the 4-5 year portion of a fixed income bond ladder."

The BMO CC&L Bond Deposit Notes Series 1 are available for sale until February 2, 2007 and will mature on April 13, 2012.

To learn more and to obtain a copy of the Information Statement, contact your financial advisor or visit www.cclcapitalmarkets.com.

Connor, Clark & Lunn Capital Markets Inc. is a leading Canadian structured financial products investment firm. Formed in 2001, they manage approximately $1.2 billion in publicly traded investment vehicles. CC&L Capital Markets is part of the Connor, Clark & Lunn Financial Group of companies, an affiliation of some of Canada's most respected investment management firms with over $30 billion in assets for institutional and individual investors.

Bank of Montreal makes no assurances, representations or warranties with respect to the accuracy, reliability or completeness of information contained herein. Furthermore, Bank of Montreal makes no recommendations concerning the Private Client Bond Portfolio (also known as Core Plus Bond Fund) or the suitability of investing in funds or securities generally or the Deposit Notes in particular. No person has been authorized to give any information or to make any representation not contained in the Information Statements relating the Deposit Notes and Bank of Montreal does not accept any responsibility for any information not contained in the respective Information Statements.

The Deposit Notes are issued by and constitute direct, unconditional obligations of Bank of Montreal. Details of certain risks of investing in the Deposit Notes, as well as complete disclosure of how variable return (if any) on the Deposit Notes is calculated, are contained in the related Information Statements, which can be obtained through your financial advisor or on www.cclcapitalmarkets.com. This summary is issued for information purposes only and does not constitute investment advice or an offer to sell or a solicitation to purchase. An investment in Bank of Montreal Connor, Clark & Lunn Bond Deposit Notes is subject to certain risks, which investors should consider. Investors should read the related Information Statements carefully before investing and discuss their suitability with their investment advisor. The Deposit Notes may not be suitable for all types of investors; the prices, and value of the Deposit Notes may fluctuate and/or be adversely affected by a number of factors. The fluctuation of the value of a Fund Portfolio will directly impact the return, if any, on the applicable Deposit Notes at maturity. In addition, for the R.O.C. Yield Class, the principal repayment at maturity will be reduced by an amount up to the total amount of principal repaid to the Holder prior to maturity, and the return payable at maturity, if any, will be reduced by an amount up to the total amount of principal repaid to the Holder prior to maturity, as set out in the Information Statement. It is possible that no return will be paid on the Deposit Notes. Sales prior to maturity may be subject to an early sales charge.

The "Connor, Clark & Lunn Capital Markets" name and logo, "Connor, Clark & Lunn Financial Group" and "Connor, Clark & Lunn Investment Management" have been licensed for use by BMO Nesbitt Burns Corporation Limited and its affiliates. "R.O.C. Yield Class" and R.O.C. are trademarks of BMO Nesbitt Burns Corporation Limited used under license. Commissions, trailing commissions, management fees and expenses all may be associated with fund investments. Unit values change frequently and past performance may not be repeated.

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