Mr. Wade MacBain reports

PACIFIC & WESTERN BANK OF CANADA ANNOUNCES CLOSING OF PREFERRED SHARE OFFERING

Pacific & Western Bank of Canada has completed the offering of non-cumulative five-year rate-reset preferred shares, Series 1, in the capital of the bank at a price of $10 per share.

A total of 1,461,460 Series 1 preferred shares were sold at the offering price, for total gross proceeds of $14,614,600.

The Series 1 preferred shares will commence trading on Oct. 30, 2014, on the Toronto Stock Exchange, under the ticker symbol PWB.PR.A.

"We are pleased with the market's interest in our first preferred share offering," said David Taylor, president and chief executive officer. "This new capital will be utilized to fuel the continued growth of the bank's loan and lease portfolio, particularly in our bulk purchase program, where we are providing much-needed capital to Canadian small businesses."

The offering was made through a syndicate of agents led by Industrial Alliance Securities Inc., and including Dundee Securities Ltd., Haywood Securities Inc., Mackie Research Capital Corp., PI Financial Corp., Burgeonvest Bick Securities Ltd. and Leede Financial Markets Inc. The bank has granted the agents an option, exercisable in whole or in part, to sell, as agents, up to 219,219 Series 1 preferred shares (equal to 15 per cent of the number of Series 1 preferred shares sold pursuant to the offering) on the same terms as set out above, to cover overallotments, if any, and for market stabilization purposes, exercisable at any time within 30 days of closing.

For the initial period ending Oct. 31, 2019, the Series 1 preferred shares will yield 7 per cent annually, payable quarterly, as and when declared by the board of directors of the bank, based on the stated issue price per share. Thereafter, the dividend rate will reset every five years at a level of 543 basis points over the then five-year government of Canada bond yield.

Subject to regulatory approval, the bank has the right to redeem up to all of the then outstanding Series 1 preferred shares on Oct. 31, 2019, and on Oct. 31 every five years thereafter, at a price of $10 per share.

Should the bank choose not to exercise its right to redeem the Series 1 preferred shares, holders of these shares will have the right to convert their shares into an equal number of non-cumulative floating-rate preferred shares, Series 2, subject to certain conditions, on Oct. 31, 2019, and on Oct. 31 every five years thereafter. Holders of the Series 2 preferred shares will be entitled to receive quarterly floating dividends, as and when declared by the board of directors of the bank, equal to the 90-day government of Canada treasury bill rate plus 543 basis points.

The Series 1 preferred shares and the Series 2 preferred shares will qualify as Tier 1 capital of the bank.

We seek Safe Harbor.