Northbridge Financial Corporation

Northbridge Financial Corporation

February 28, 2005 16:05 ET

Northbridge Financial Corporation Announces Closing of Sale of Federated Life Insurance Company of Canada


NEWS RELEASE TRANSMITTED BY CCNMatthews

FOR: NORTHBRIDGE FINANCIAL CORPORATION

TSX SYMBOL: NB

FEBRUARY 28, 2005 - 16:05 ET

Northbridge Financial Corporation Announces Closing of
Sale of Federated Life Insurance Company of Canada

TORONTO, ONTARIO--(CCNMatthews - Feb. 28, 2005) - Northbridge Financial
Corporation (TSX:NB) is pleased to announce that it has completed the
sale of its wholly owned subsidiary Federated Life Insurance Company of
Canada to Western Financial Group Inc. previously announced on May 26,
2004.

Federated Life Insurance Company of Canada, which will operate going
forward under the name Western Life Assurance Company, offers life,
disability and health insurance products to small and mid-sized
enterprises as well as to individuals. During the fiscal year ended
December 31, 2004 Federated Life wrote gross premiums of $23.6 million
and recorded total revenues of $20.7 million. Federated Life had total
assets at December 31, 2004 of $54.9 million.

"We are pleased with the manner in which our Federated Life employees
have been welcomed into the Western Financial Group family. Federated
Insurance looks forward to working with Western Financial Group to
continue the success of Western Life Assurance Company in serving our
customers", commented John Paisley, President of Federated Insurance
Company of Canada. Byron Messier, President and Chief Executive Officer
of Northbridge, added, "Western has acquired a well managed business
with an established customer base and a long record of profitability,
and we wish Western Life Assurance Company success."

"The acquisition of Federated Life with its established life and health
insurance business substantially completes the product line of
integrated financial services Western Financial Group has been building
since 1996. We look forward to continuing our very positive relationship
with Federated Insurance as we expand the business of Western Life
Assurance Company," said Scott Tannas, President and Chief Executive
Officer of Western Financial Group Inc.

The purchase price of $20 million represents a pre-tax gain on the sale
for Northbridge of approximately $4 million after accounting for
expenses of the transaction.

Northbridge, which through its subsidiaries provides property and
casualty insurance products primarily in the Canadian market as well as
in selected U.S. and international markets, is one of the largest
commercial property and casualty insurers in Canada based on gross
premiums written. The common shares of Northbridge are listed and traded
under the symbol NB on the Toronto Stock Exchange. Visit Northbridge at
www.northbridgefinancial.com for more information.

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Contact Information

  • FOR FURTHER INFORMATION PLEASE CONTACT:
    Northbridge Financial Corporation
    Greg Taylor
    Chief Financial Officer
    (416) 350-4300
    www.northbridgefinancial.com