Cervus Financial Group Inc.
TSX : CFG

Cervus Financial Group Inc.

November 03, 2005 08:30 ET

Cervus Launches The Wealth Index for the Mortgage Broker Industry

TORONTO, ONTARIO--(CCNMatthews - Nov. 3, 2005) -

The Wealth Index is currently increasing at $1.00/2 seconds for the participating mortgage professionals

Cervus Financial Group Inc. ("Cervus"), (TSX:CFG), is a financial services company dedicated to providing mortgages through select mortgage brokers. Cervus is pleased to announce the launch of the Wealth Index providing an illustrative tool for mortgage brokers to gauge the wealth creation power of Cervus's unique "Customer for Life" business model. Cervus compensates the broker with a one time origination fee, a trailer fee for each year the mortgage remains with Cervus and a renewal fee upon the renewal of the mortgage for another term. The wealth index represents the present value of the trailer and renewal fees, acting as an indicator for the participating mortgage professionals of the value of the asset and ownership of the customer.

"The traditional mortgage compensation pays a one time fee to the mortgage professional with the borrower relationship reverting to the traditional mortgage lender and this model creates limited wealth for the mortgage professional", states Gary Bartholomew, CEO of Cervus. "With the Cervus 'Customer for Life' model, the mortgage professional retains an interest in and ownership of the borrower and continually generates financial compensation in the form of trailer and renewal fees throughout the life of the mortgage. The Cervus Wealth Index provides a real time indication of the value being created acting potentially as the mortgage professional's retirement fund."

The Wealth Index will be unveiled at the Canadian Institute of Mortgage Brokers and Lenders annual mortgage conference and expo taking place November 6 - November 8, 2005 at the Metro Toronto Convention Centre. The index is calculated based upon a number of assumptions including daily volume, average mortgage loan amount and the average life of the mortgage with Cervus. The index demonstrates the wealth creation potential of the company's trailer fee and renewal fee model for mortgage brokers. As of at September 30, 2005, the index was calculated at $6,100,000 and was rising at $1.00 per every 2 seconds.

About "Customer for Life"

The Cervus "Customer for Life" model enables the mortgage professional to retain the relationship with the borrower as a customer throughout the life of the mortgage. The compensation model also creates a continued revenue stream in the form of trailer fees, a one time origination fee and a renewal fee every time the customer renews with Cervus. This creates income security for the mortgage professional allowing a long-term relationship to be developed with the borrower. This long-term relationship subsequently gets passed along to the institutional investor of the mortgage security, creating a higher yield long-term investment cash flow stream. The Cervus "Customer for Life" model creates profitable relationships for the borrowers, mortgage professionals, institutional investors and for Cervus.

About Cervus

Cervus Financial Group Inc. is a Canadian financial services company created as an industry initiative with leading mortgage broker companies and fixed income investment banks to become a high-yield residential mortgage producer and the largest mortgage broker lender of conventional insured and insurable mortgages in Canada. Our new and innovative business model demonstrates contracted asset accumulation of $22.5 billion in mortgages over five to seven years by fusing industry ownership, technology, service delivery and long term recurring revenue for the mortgage brokers.

Cervus works on the basis of a "Customer for Life" model, where the borrower is the client of the mortgage broker and Cervus is effectively the "Back Office - Servicer" between borrowers and investors. Cervus has assembled an experienced management team and board of directors who are knowledgeable in banking, financial services and related businesses. Cervus is focused on funding and servicing insurable conventional and high ratio insured residential mortgages originated through mortgage brokers. Cervus is currently licensed under Ontario, Quebec, British Columbia and Alberta mortgage broker/lender legislation and is seeking similar regulatory approvals in other Canadian Provinces as required. Cervus's head office and Ontario operations centre is located in Toronto, with additional sales offices in Vancouver, Calgary and in Montreal. Cervus Financial Group Inc. conducts all lending operations through its wholly-owned subsidiary, Cervus Financial Corp.

Forward-looking (safe harbour) statement

Statements made in this news release that relate to future plans, events or performances are forward-looking statements. Any statement containing words such as "believes," plans," "expects" or "intends" and other statements which are not historical facts contained in this release are forward-looking, and these statements involve risks and uncertainties and are based on current expectations. Consequently, actual results could differ materially from the expectations expressed in these forward-looking statements.

Additional information about Cervus is available on SEDAR (www.sedar.com).

The TSX does not accept responsibility for the adequacy or accuracy of this release.

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