Industrial Alliance Becomes a Mutual Funds Manufacturer by Acquiring Co-Operators Mutual Funds Limited

QUEBEC CITY, Aug. 15, 2003 – Industrial Alliance Insurance and Financial Services Inc. (“Industrial Alliance”) and The Co-operators Group Limited (“The Co-operators Group”) announced an agreement today under which Industrial Alliance will acquire all common shares of Co-operators Mutual Funds Limited (“CMFL”) that are held by an indirect wholly-owned subsidiary of The Co-operators Group. This agreement will allow Industrial Alliance to offer its own family of mutual funds under CMFL’s current structure. This agreement is subject to regulatory approval.

CMFL is an indirect subsidiary of The Co-operators Group, the largest Canadian-owned multi-product insurer in the country. Created in 2000, CMFL is the trustee, manager and promoter of eleven mutual funds that are offered under three banners: The Co-operators Heritage Mutual Funds, The Co-operators/Crystal Mutual Funds and The Co-operators/Credit Suisse Mutual Funds. These funds are distributed by over 400 representatives operating out of some 50 mutual fund dealers. The market value of CMFL’s funds under management is almost $90 million.

“This acquisition marks a major step forward in our growth strategy in the wealth management sector,” stated Normand P�pin, Executive Vice-President at Industrial Alliance. “By providing ourselves with the capacity to manufacture and offer our own line of mutual funds, based on the expertise of The Co-operators Group, we are strengthening our position in this market sector, which is one of Industrial Alliance’s strategic objectives. This acquisition will also allow us to further broaden our product range. Our representatives will now be able to offer an extended line of life insurance products as well as wealth management products, such as mutual funds, segregated funds and securities.”

“The purchase of Co-operators Mutual Funds Limited by Industrial Alliance will ensure a smooth transition for our clients and representatives,” commented David Hartman, President of CMFL. “They will be able to rely on the expertise and strength of a Canada-wide organization that has been in the market for over 100 years. The relationship of trust that has developed over the years between clients and representatives will thus continue as before, and with the same level of professionalism. The Co-operators Group now intends to focus its wealth management strategy on its core strengths of pension management and segregated funds, but will continue to sell mutual funds, including those managed by CMFL. In addition, Co-operators Investment Counselling Limited will continue as investment manager for certain of the funds managed by CMFL.”

Although Industrial Alliance has been distributing the mutual funds of various external managers for several years, until now it has never manufactured its own line of mutual funds. Industrial Alliance also has its own line of segregated funds and is among the top designers, manufacturers and distributors of segregated funds in Canada. In 2002, Industrial Alliance ranked third in Canada in terms of net segregated fund sales and fifth in terms of assets under management.

About The Co-operators Group

The Co-operators is a group of wholly owned Canadian companies which specialize in insurance and financial security products, property development and management, and investment counselling. The Co-operators group of companies provides insurance protection to more than two million Canadians and has assets of over $5 billion.

About Industrial Alliance

Industrial Alliance is a life and health insurance company that offers a full line of insurance products and financial services. Created in 1892, Industrial Alliance is now the parent company of a large financial group – the Industrial Alliance Group – which has operations throughout Canada. The Group distributes its products through Industrial Alliance (Quebec City), National Life (Toronto) and Industrial Alliance Pacific (Vancouver). The seventh largest life and health insurance organization in Canada, the Industrial Alliance Group insures more than 1.5 million Canadians, employs over 2,100 people and manages $17.9 billion in assets. Industrial Alliance stock is listed on the Toronto Stock Exchange, under the ticker symbol IAG. Industrial Alliance is one of the 100 largest public companies in Canada.