Headnote

National Policy 11-203 Process for Exemptive relief Applications in Multiple Jurisdictions –Exemptive relief granted to an exchange traded mutual fund from certain mutual fund requirements and restrictions on: borrowing, investments, organizational costs, calculation and payment of redemptions, preparation of compliance reports, and record date for payment of distributions – Since investors will generally buy and sell shares through the TSX, requirements intended principally for conventional mutual funds in continuous distribution are largely not applicable –requested relief would not be prejudicial to investors – National Instrument 81-102 – Mutual Funds.

Applicable Legislative Provisions

National Instrument 81-102 Mutual Funds, sections 2.1(1), 2.6(a), 3.3, 10.3, 10.4(1), 12.1(1), 14.1 and 19.1.

November 10, 2008

In the Matter of

the Securities Legislation of

Ontario

(the Jurisdiction)

and

In the Matter of

the Process for Exemptive Relief Applications in Multiple Jurisdictions

and

In the Matter of

First Asset CanBanc Split Corp.

(the Filer)

DECISION

Background

The principal regulator in the Jurisdiction has received an application from the Filer for a decision under the securities legislation of the Jurisdiction of the principal regulator (the Legislation) that the following provisions of National Instrument 81-102 Mutual Funds (NI 81-102) will not apply to the Filer with respect to the Offering of the Preferred Shares and the Class A Shares (each as defined below) (the Exemption Sought):

1. section 2.1(1), which prohibits a mutual fund from investing more than 10% of its net assets in any one issuer;

2. section 2.6(a), which restricts a mutual fund in borrowing cash or providing a security interest over its portfolio assets;

3. section 3.3, which prohibits the costs of incorporation, formation or initial organization of a mutual fund or of the preparation and filing of any prospectus and annual information form from being borne by a mutual fund or its securityholders;

4. section 10.3, which requires the redemption price of a security of a mutual fund to which a redemption order pertains to be the net asset value (NAV) next determined after the receipt by the mutual fund of the redemption order;

5. section 10.4(1), which requires a mutual fund to pay the redemption price for securities that are the subject of a redemption order within three business days after the date of calculation of the NAV per security used in establishing the redemption price;

6. section 12.1(1), which requires a mutual fund that does not have a principal distributor to complete and file a compliance report, and accompanying letter of the auditor, in the form and within the time period mandated by section 12.1(1); and

7. section 14.1, which requires the record date for determining the right of securityholders of a mutual fund to receive a dividend or distribution by the mutual fund to be calculated in accordance with section 14.1.

Under the Process for Exemptive Relief Applications in Multiple Jurisdictions (for a passport application):

(a) the Ontario Securities Commission is the principal regulator for this application, and

(b) the Filer has provided notice that Section 4.7(1) of Multilateral Instrument 11-102 Passport System (MI 11-102) is intended to be relied upon in Alberta, British Columbia, Quebec, Nova Scotia, New Brunswick, Saskatchewan, Newfoundland and Labrador, Manitoba and Prince Edward Island.

Interpretation

Terms defined in National Instrument 14-101 Definitions and MI 11-102 have the same meaning if used in this decision, unless otherwise defined.

Representations

This decision is based on the following facts represented by the Filer:

The Filer

1. The Filer is a mutual fund corporation incorporated under the laws of Ontario on September 5, 2008 with its head office in Toronto, Ontario. First Asset Investment Management Inc. (Manager) is the manager of the Filer with its head office in Toronto, Ontario.

2. The Filer and any other relevant party is not in default of securities legislation in any jurisdiction.

The Offering

3. The Filer will make an offering (Offering) to the public of preferred shares (Preferred Shares) and class A shares (Class A Shares) of the Filer (collectively, the Shares). A Unit will consist of one Preferred Share and one Class A share (a Unit).

4. The Filer has filed a long form final prospectus dated October 31, 2008 (Prospectus) in respect of the Offering and the Shares with the securities regulatory authorities in each of the provinces of Canada.

5. The Offering is a one-time offering and the Filer will not continuously distribute the Shares.

6. The proceeds of the Offering will be invested, on an approximately equally weighted basis, in a diversified portfolio consisting of common shares of the six largest Canadian banks (Bank Shares). The Bank Shares and any cash and cash equivalents held by the Filer will be the only assets of the Filer (Portfolio).

7. The Filer is authorized to borrow money required for working capital purposes and will pledge its assets for this money. The Filer will limit this borrowing to a maximum of 5% of the Filer’s NAV. This borrowing is disclosed in the Prospectus.

8. The estimated costs of launching the Filer are disclosed in the Prospectus. The Manager has agreed to reimburse the Filer for expenses of the Offering in quarterly instalments equal to one quarter of 1% of the Filer’s NAV per annum over a period of seven years. This obligation will be evidenced by a note issued at the closing of the Offering that will bear interest at the prime rate of interest reported by the Filer’s primary lender from time to time.

9. All of the Shares will be redeemed by the Filer on or about January 15, 2016.

The Shares

10. The Filer’s investment objectives with respect to the Preferred Shares are:

(a) to provide holders of Preferred Shares (Preferred Shareholders) with fixed cumulative preferential quarterly cash distributions in the amount of $0.1625 per Preferred Share ($0.65 per annum representing an annual yield of 6.5% based on the original issue price of a Preferred Share); and

(b) to return the original issue price to Preferred Shareholders at the time of redemption of such shares on or about January 15, 2016.

11. The Filer’s investment objectives with respect to the Class A Shares are to provide holders of Class A Shares (Class A Shareholders, together with the Preferred Shareholders, the Shareholders) with the opportunity to participate in the performance of the Portfolio on a leveraged basis and to benefit from any increase in the dividends from the securities in the Portfolio.

12. The Shares are expected to be listed and posted for trading on the Toronto Stock Exchange (TSX).

13. The Shares will be redeemable at the option of the Shareholder on a monthly basis at a price computed with reference to the value of a proportionate interest in the net assets of the Filer. As a result, the Filer will qualify as a “mutual fund” under applicable securities legislation.

14. Shares may be surrendered at any time for retraction by the Filer and will be retracted on a monthly basis on the second last business day of a month at a retraction price determined on such date (the Valuation Date) provided they are surrendered at least 10 business days prior to the Valuation Date.

15. Shareholders may also concurrently surrender for retraction by the Filer an equal number of Preferred Shares and Class A Shares at a retraction price determined on the January Valuation Date of each year commencing in January 2010 provided the Shares are surrendered at least 10 business days prior to the January Valuation Date.

16. As retraction requests may be made at any time during the month and are subject to a cut-off date (10 business days prior to the Valuation Date), and as the NAV per Unit of the Filer will be calculated each business day, retractions may not be implemented at a price equal to the NAV per Unit next determined after receipt of the retraction request.

17. Book entry only certificates representing Shares will be issued in registered form to CDS Clearing and Depository Services Inc. (CDS). The mechanics of retraction of the Shares will follow the following process. Upon receipt of a retraction request from a Shareholder, the Shareholder’s investment adviser must send a retraction request to CDS. CDS aggregates all retraction requests received during the month and must ensure the information is submitted to the registrar and transfer agent for the Filer (the Registrar and Transfer Agent). The Registrar and Transfer Agent then informs the Manager of the amount owing under these retraction requests and this information is submitted to the Filer’s custodian. The custodian then provides the appropriate funds to the Registrar and Transfer Agent (requiring a sale of a portion of the securities in the Portfolio) who provides it to CDS for distribution to CDS participants, who in turn distribute the retraction proceeds to their clients.

18. As described in the Prospectus, the Preferred Shareholders and the Class A Shareholders will receive payment pursuant to a retraction request on or before the 15th business day of the month that follows the Valuation Date (Retraction Payment Date).

19. The record date for Preferred Shareholders’ quarterly distributions will be established in accordance with the requirements of the TSX from time to time.

Decision

The principal regulator is satisfied that the decision meets the test set out in the Legislation for the principal regulator to make the decision.

The decision of the principal regulator under the Legislation is that the Exemption Sought is granted on the following basis:

(a) section 2.1(1) - to enable the Filer to invest its assets in the Portfolio as described in paragraph 6 above;

(b) section 2.6(a) - to enable the Filer to borrow money for working capital purposes and provide a security interest over its assets, as described in paragraph 7 above, so long as the outstanding amount of any such borrowing by the Filer does not exceed 5% of the net assets of the Filer taken at market value at the time of the borrowing;

(c) section 3.3 - to permit the Filer to bear the expenses of its launch as described in paragraph 8 above;

(d) section 10.3 - to permit the Filer to calculate the retraction price for the Shares in the manner described in the Prospectus and on the applicable Valuation Date;

(e) section 10.4(1) - to permit the Filer to pay the retraction price for the Shares on the Retraction Payment Date;

(f) section 12.1(1) - to relieve the Filer from the requirement to file the prescribed compliance reports; and

(g) section 14.1 - to relieve the Filer from the requirement relating to the record date for payment of dividends or other distributions, provided that it complies with the applicable requirements of the TSX.

Darren McKall

Name: Darren McKall Title: Assistant Manager, Investment Funds Branch Ontario Securities Commission

Headnote

National Policy 11-203 Process for Exemptive relief Applications in Multiple Jurisdictions –Exemptive relief granted to an exchange traded mutual fund from certain mutual fund requirements and restrictions on: borrowing, investments, organizational costs, calculation and payment of redemptions, preparation of compliance reports, and record date for payment of distributions – Since investors will generally buy and sell shares through the TSX, requirements intended principally for conventional mutual funds in continuous distribution are largely not applicable –requested relief would not be prejudicial to investors – National Instrument 81-102 – Mutual Funds.

Applicable Legislative Provisions

National Instrument 81-102 Mutual Funds, sections 2.1(1), 2.6(a), 3.3, 10.3, 10.4(1), 12.1(1), 14.1 and 19.1.