LOM News

Ø    Butterfield Group ("NTB") reported a net loss for 2010 of $213 million ($2.34 per diluted share) as the result of a $132 million impairment to the Bank's investment book and a $94 million loan loss provision primarily related to the hospitality industry.

Ø    To remove risk from its balance sheet, NTB announced that it will suspend its dividend and raise $550 million in new equity at a price of $1.21 per share. The two major investors include Carlyle Group and CIBC 8($150 million apiece) and a consortium of other institutional investors ($250 million in aggregate.)

Ø Current NTB shareholders will be invited to subscribe on a pro-rata basis to an offering in which they will have the right to invest an additional $130 million in common shares at the same $1.21 per share price as the new institutional investors. Terms of the rights issue will be released soon.

Ø The $1.21 per share purchase price represents a 27% premium over pro-forma (i.e. after future dilution) fiscal 2009 book value per share of $0.95.

Ø    CIBC has provided a commitment letter to NTB for a line of credit up to $500 million.

Ø    Current CFO Bradford Kopp has been promoted to President and CEO, replacing the departed Alan Thompson. In addition, two Carlyle Group and two CIBC nominees will be appointed to the Board.

Ø    NTB's new management provided a detailed breakdown of the Butterfield's investment portfolio, and emphasized the likelihood of a further loss in the range of $150-175 million to be incurred in 1Q2010.