Mr. Rick Skauge reports

OLYMPIA RECEIVES ADVERSE TAX RULING ON NON-RESIDENT WITHHOLDING TAX ISSUE

Olympia Financial Group Inc. has received an adverse tax ruling from the Tax Court of Canada declaring Olympia Trust Company to be a purchaser for the purposes of Section 116(5) of the Income Tax Act (Canada), whereby OTC is liable for certain withholding tax obligations relating to share sale transactions completed by certain self-directed registered plans to non-residents from 2001 to 2004. Olympia is proceeding to appeal this adverse ruling and will also seek to enforce its contractual right to be indemnified for the tax liabilities from the annuitants that completed these transactions.

The adverse tax ruling relates to certain notices of assessment received in March, 2010. Olympia remitted the assessed amount and had recorded such payment as taxes recoverable -- an asset of $1.27-million based on the probability of success for its appeal of the assessments (as determined by Olympia's adviser). In light of this recent adverse ruling, Olympia will record a charge in the fourth quarter of fiscal 2014 in the amount of approximately $1.27-million, the net after-tax effect of this being $950,000.