BK Canadian Banc Corp

Canadian Banc Recovery Corp. ("Canadian Banc") announces a Class A share
subdivision for all Class A shareholders of record on January 17, 2012 that will
increase the number of shares held by each shareholder. The purpose of the share
subdivision is to maintain an equal number of Class A shares and Preferred
shares outstanding.


As a result of the successful vote to extend the termination date of Canadian
Banc to December 1, 2018 at the recent Special Meeting of Shareholders held on
November 3, 2011, both Class A shareholders and Preferred shareholders were
given a special retraction right. This special retraction right allowed both
classes of shareholders to tender one or both classes of shares and receive a
retraction price based on the December 30, 2011 net asset value per Unit ($10
per Preferred Share, $10.68 per Class A Share and $20.68 per Unit, as
applicable). In aggregate, there were more Class A shares tendered for
retraction than Preferred shares. Since Canadian Banc is required to maintain an
equal number of shares outstanding for each Class as per the prospectus, the
Company must increase the Class A shares to match the number of Preferred
shares.


Immediately after the special retraction payment on January 16, 2012, there will
be 6,772,453 Preferred shares and 5,737,131 Class A shares outstanding. In order
to restore an equal amount of shares outstanding for each Class, Class A
shareholders on record as at January 17, 2012 will receive approximately
1.180459885 Class A shares for each Class A share outstanding. The increase in
shares (subdivision) is a non taxable event.


In addition, the monthly Class A share dividend target formula will be adjusted
in order to approximately maintain the same pre subdivision dividend formula.
This will result in shareholders maintaining their current level of dividend
income per month. The new formula will be adjusted to provide Class A shares
with regular floating rate monthly distributions targeted to be at a rate per
annum equal to the prime rate plus 1.25% with a minimum targeted annual rate of
return of 4.25% and a maximum annual rate of return of 8.50% based on the
original issue price of $15 per Class A share. The current Class A share
dividend yield based on the January 11, 2012 closing market price was 7.14%.


The intrinsic value of each investor's holdings in Class A shares will be the
same after the adjustment. The increase in the number of shares would be
proportionate to the reduction in the net assets attributable to the Class A
shares.


The table below is an illustrative example of the effects of the subdivision
with all numbers rounded.




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                                                 Before          After     
                                               Subdivision    Subdivision  
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Class A shares owned                          (A)    1,000  (A)       1,180
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Net asset value per Unit as at December 31,                                
 2011                                              $ 20.68         $  19.05
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Par value of Preferred share                       $ 10.00         $  10.00
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Net asset value per Unit attributable to                                   
 Class A share                                (B)  $ 10.68  (B)    $   9.05
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Total net asset value attributable to Class                                
 A shareholder (A x B)                             $10,680         $ 10,680
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Class A share current dividend rate per                                    
 floating rate formula                             $  0.75         $ 0.6375
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Class A share annual dividend payment              $   750         $    752
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(all numbers rounded)                                                      
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The impact of the Class A share subdivision will be reflected in the next
reported net asset value per unit as at January 31, 2012. Net assets of Canadian
Banc after the retractions payments will be approximately $135 million.

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