Equitable Group Inc. completes $70 million preferred share offering

/NOT FOR DISTRIBUTION TO UNITED STATES NEWSWIRE SERVICES OR FOR DISSEMINATION IN THE UNITED STATES/

TORONTO, Aug. 8, 2014 /CNW/ - Equitable Group Inc. (TSX: EQB, EQB.PR.A and EQB.PR.C) (the "Company") today announced that it has successfully raised total proceeds of $70 million by way of a bought deal prospectus offering.

A total of 2,800,000 Non-Cumulative 5-Year Rate Reset Preferred Shares, Series 3 of the Company (the "Series 3 Preferred Shares") were sold at a price of $25.00 per share. The shares were placed on a bought deal basis to a syndicate of underwriters led by TD Securities Inc. and Scotiabank. The offering raised gross proceeds of $70 million.

The Company used the proceeds from the offering to acquire Non-Cumulative 5-Year Rate Reset Preferred Shares, Series 3 (the "Bank Series 3 Preferred Shares") from its wholly-owned subsidiary, Equitable Bank, which qualify as Tier 1 capital for Equitable Bank, with terms and conditions similar to the Series 3 Preferred Shares issued by Equitable Group.

The Series 3 Preferred Shares yield 6.35% annually, payable quarterly, as and when declared by the Board of Directors of the Company for an initial period ending September 30, 2019. Thereafter, the dividend rate will reset every five years at a level of 4.78% over the then five-year Government of Canada bond yield. Holders of Series 3 Preferred Shares will, subject to certain conditions, have the option to convert their shares to Non-Cumulative Floating Rate Preferred Shares, Series 4 (the "Series 4 Preferred Shares") on September 30, 2019 and on September 30 every five years thereafter. Holders of the Series 4 Preferred Shares will be entitled to a floating quarterly dividend rate equal to the 90-day Canadian Treasury Bill Rate plus 4.78%, as and when declared by the Board of Directors of the Company.

The Series 3 Preferred Shares and Series 4 Preferred Shares of the Company were not registered under the U.S. Securities Act of 1933, as amended, and may not be offered or sold in the United States absent registration or an applicable exemption from the registration requirements. This news release shall not constitute an offer to sell or the solicitation of an offer to buy, nor shall there be any sale of the securities in any State in which such offer, solicitation or sale would be unlawful.

About Equitable Group Inc.

Equitable Group Inc. is a growing Canadian financial services business that operates through its wholly-owned subsidiary, Equitable Bank.  Equitable Bank is a Schedule I Bank regulated by the Office of the Superintendent of Financial Institutions Canada with total assets of approximately $12 billion, with more than 300 employees and proven capabilities in lending and deposit-taking.  The Company's integrated operations are organized according to specialty.  We serve retail and commercial customers across Canada with a range of savings solutions and mortgage lending products.  Within Equitable Bank's Core Lending business, Single Family Lending Services funds mortgages for owner-occupied and investment properties across Canada while Commercial Lending Services provides mortgages on a variety of commercial properties on a national basis.  Equitable's Securitization Financing business originates and securitizes insured residential mortgages under the Canada Mortgage and Housing Corporation administered National Housing Act.  Measured by assets, Equitable Bank was the ninth largest independent Schedule I Bank in Canada at March 31, 2014.  For more information, visit the Company's website at www.equitablebank.ca and click on Investor Relations.

Forward-Looking Statements

This press release contains "forward-looking statements" within the meaning of applicable Canadian securities legislation. Generally, forward-looking statements can be identified by the use of forward- looking terminology such as "plans", "expects" or "does not expect", "is expected", "budget", "scheduled", "planned", "estimates", "forecasts", "intends", "anticipates" or "does not anticipate", or "believes", or variations of such words and phrases or state that certain actions, events or results "may" ,"could", "would", "might" or "will be taken", "occur" or "be achieved". Forward-looking statements are subject to known and unknown risks, uncertainties and other factors that may cause the actual results, level of activity, closing of transactions, performance or achievements of the Company to be materially different from those expressed or implied by such forward-looking statements, including but not limited to: risks related to capital markets and additional funding requirements, fluctuating interest rates and general economic conditions, legislative and regulatory developments, the nature of our customers and rates of default, and competition as well as those factors discussed in the Company's documents filed on SEDAR (www.sedar.com).

Although the Company has attempted to identify important factors that could cause actual results to differ materially from those contained in forward-looking statements, there may be other factors that cause results not to be as anticipated, estimated or intended. There can be no assurance that such statements will prove to be accurate, as actual results and future events could differ materially from those anticipated in such statements. Accordingly, readers should not place undue reliance on forward-looking statements. The Company does not undertake to update any forward-looking statements that are contained herein, except in accordance with applicable securities laws. Further information on the Company is available at www.sedar.com.

This news release and the information contained herein does not constitute an offer of securities for sale in the United States and securities may not be offered or sold in the United States absent registration or exemption from registration.

SOURCE Equitable Group Inc.

For further information: Andrew Moor, President and Chief Executive Officer, 416-515-7000; Tim Wilson, Vice-President and Chief Financial Officer, 416-515-7000