CI Pro-FIT Note Update: December 30th 2005

Underlying Mutual Fund Index
As of December 30th 2005, the underlying mutual fund index was at 1211.23. This represents a 21.11% index increase for Series 1 and 23.25% index increase for Series 2 (both since inception).

Notes' NAV (gross of sales charges)
The NAVs for those two notes are 110.76 (up 10.76%) and 112.54 (up 12.54%) respectively.

Performance difference: how is it explained?
As a result of the principal protection feature they offer, these notes are not direct investments in the underlying mutual funds. A substantial part of the notes is initially invested in instruments providing the protection of capital. The remainder is spent to replicate the return of the mutual funds. This generally implies that the return on the notes will be paid on specific dates. These two notes can pay either at mid-point (if called) or at maturity (if not called).

The difference between the notes' performance and the underlying index performance is derived from the 2 points presented above. An easy way to understand it is to analyze the current index performance in light of when the note is supposed to pay a return. For example, Series 1 has an underlying index performance of 21.11%. Given that performance, the market evaluates today the probability that the note will pay a positive return at year 4 or year 8. Hence, the NAV is a mere reflection of what the market thinks the note will pay at mid-point or at maturity.

In other words, as of today and given current probabilities, the market evaluates that the current value of what it expects the notes to pay is 10.76% above initial capital. Those probabilities can change and are dependent on several factors, including the performance and volatility of the underlying funds and the level of interest rates.

Future performance: how will the notes behave?
The 2 main components of these notes are principal protection and mutual fund exposure. Generally speaking, increasing rates will have a tendency to hurt the value of these notes because they reduce the current value of the protected capital at maturity (the current value of $100 at 4% rates is higher than that at 6% rates). As for the market performance, while it is obvious that increasing mutual fund performance will help this note, the investors must keep in mind that the market will also evaluate the probability of payment at year 4 or year 8, which will influence the tracking distance between the mutual fund and the note.

Laurent L. Ferreira - Nicolas G. Patard - François Rivard - Isabelle Paquet / Tél. : 514-394-8561 - Fax : 514-397-5836
"Unless otherwise agreed in writing, National Bank of Canada and its affiliates act solely in the capacity of an arm's length contractual counterparty and not as an adviser or fiduciary. Accordingly you should not regard transaction proposals or other written or oral communications from us as a recommendation or advice that a transaction is appropriate for you or meets y our financial objectives. Any financial transaction involves a variety of potentially significant risks and issues. Before entering into any financial transaction, you should ensure that you fully understand the terms, have evaluated the risks and have d etermined that the transaction is appropriate for you in all respects. If you believe that you need assistance, you should consult appropriate advisers before entering into the transaction. The attached material does not constitute an offer to enter into any transaction. Such material is believed by us to be reliable, but we make no representation as to its accuracy or completeness. This brief statement does not purport to describe all of the risks associated with financial transactions and should not be construed as advice to you."