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3 May 2007

BNP Buys Into Canadian Hedge Fund Subsidiary

BNP Paribas and the National Bank of Canada announced in a press release today that BNP Paribas has acquired a stake in Innocap Investment Management Inc., a subsidiary of National Bank of Canada, which specializes in hedge fund managed accounts.

They have formed a joint venture offering hedge fund managed accounts, a vehicle of choice for retail and institutional investors who wish to invest in hedge funds while controlling operational and market risks. National Bank of Canada and BNP Paribas intend to make Innocap the leading provider of managed accounts for investors worldwide.

Innocap, which advises on over $2 billion in hedge fund assets, provides active daily monitoring of alternative funds with complete transparency on the underlying positions and on the setting of adequate risk limits and investment guidelines. Additionally, it monitors operational risk, and advises on, along with third party service providers, all the key operations for the hedge funds.

“I'm delighted by the creation of this partnership,” said Yann Gerardin, Global Head of BNP Paribas Equities and Derivatives. “Innocap offers a powerful platform with full-fledged high-tech risk monitoring, control, liquidity and transparency to investors. These capabilities will enable us to create a new generation of structured products, which we expect will have broad appeal to an international client base.”

This joint venture will allow BNP Paribas, recently awarded “Equity Derivatives House of the Year” by Risk Magazine, to strengthen its capabilities in structuring fund derivatives products, while completing its global alternative fund offering.

Martin Gagnon and Denis Parisien, co-CEOs of Innocap added: “BNP Paribas and National Bank of Canada are complementary, well-established institutions sharing the same business vision and ambition. We are confident in this joint venture and look forward to its success.”

Innocap is the end result of 11 years of investments in hedge fund strategies for the National Bank of Canada.

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