Scotiabank launches Citadel Hill 2000 debt fund

NEW YORK, December 20, 2000 – Scotiabank today announced that it has launched Citadel Hill 2000, a $500 million Collateralized Debt Obligation (CDO) managed by Citadel Hill Advisors, the Bank's new portfolio management company. The fund will provide institutional investors with the opportunity to benefit from the expertise of Scotiabank Group and Citadel Hill Advisors.

"As the leading Canadian player in the U.S. syndicated loan market, we are pleased to enter the fund management business," said Barry Luter, Co-Chairman and CEO of Scotiabank's corporate and investment banking arm, Scotia Capital. "Strategically, establishing Citadel Hill 2000 will provide a foundation for launching a series of managed debt funds. By launching Citadel Hill 2000, we are ensuring that our clients are able to access a broader range of products."

The portfolio will consist primarily of senior secured bank loans. A Board of Directors consisting of executive managers from Scotiabank oversees Citadel Hill Advisors, and senior personnel from Citadel Hill will oversee Citadel Hill 2000's performance. An Investment Committee comprised of some of Scotiabank's most experienced lending officers in the U.S. plus Citadel Hills' two most senior officers will decide all investments to be included in the CDO. The Bank will earn management fees in addition to its equity returns.

"We are pleased with Scotiabank's investment in the Citadel Hill 2000 debt fund," said Stephen Lockhart, President of Citadel Hill Advisors. "Scotiabank brings long-term expertise in leveraged financing including industry, obligor and sponsor knowledge as well as asset sourcing capabilities. It is a very logical extension of Scotiabank's and Scotia Capital's existing business lines in the U.S."

Citadel Hill Advisors is a wholly-owned subsidiary of Scotiabank dedicated to focusing on U.S. debt fund management with the objective of managing a series of CDO funds. Citadel Hill is located in New York.

Scotia Capital is a leader in the corporate and investment banking industry, with a presence in both major and regional financial centres around the world. Scotia Capital is a member of the Scotiabank Group. Scotiabank is one of North America's premier financial institutions, with more than $253 billion in assets and approximately 41,000 employees worldwide. It is also Canada's most international bank, with 1,700 branches and offices in over 50 countries. For more information visit www.scotiacapital.com or www.scotiabank.ca.

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For further information:
Stephen Lockhart, Citadel Hill Advisors, (212) 225-5025 or slockhart@citadel-hill.com
Nicholas Karsiotis, Citadel Hill Advisors, (212) 225-5052 or nkarsiotis@citadel-hill.com
Jane Shannon, Scotiabank Public Affairs, (416) 933-1795 or jane_shannon@scotiacapital.com