Premium Income Corporation Files Preliminary Prospectus for

Premium Income Corporation Files Preliminary Prospectus for Rights
TORONTO, ONTARIO -- (Marketwire) -- 10/19/12 --
(TSX:PIC.A)(TSX:PIC.PR.A) - Premium Income Corporation (the "Fund")
is pleased to announce that it has filed a preliminary short form
prospectus relating to an offering of rights ("Rights") to holders
("Shareholders") of its class A shares ("Class A Shares") and
preferred shares ("Preferred Shares"). Each Shareholder of record on
a date to be established prior to filing the final short form
prospectus will receive one Right for each Class A or Preferred Share
Two Rights will entitle the holder to acquire one Class A Share and
one Preferred Share upon payment of the subscription price. The
record date and the subscription price will be determined at the time
the Fund files its final prospectus for the offering.  
The exercise of Rights by holders will provide the Fund with
additional capital that can be used to take advantage of attractive
investment opportunities and is also expected to increase the trading
liquidity of the Class A Shares and the Preferred Shares as well as
reduce the management expense ratio of the Fund.  
The Fund invests in a portfolio consisting principally of common
shares of Bank of Montreal, The Bank of Nova Scotia, Canadian
Imperial Bank of Commerce, Royal Bank of Canada and The
Toronto-Dominion Bank (the "Banks"). To generate additional returns
above the dividend income earned on the Fund's portfolio, the Fund
may from time to time write covered call options in respect of some
or all of the common shares in the Fund's portfolio. The Fund may
also, from time to time, write cash-covered put options in respect of
securities in which the Fund is permitted to invest. The manager and
investment manager of the Fund is Strathbridge Asset Management Inc.  
For further information, please contact at 416.681.3966, toll free at
1.800.725.7172 or visit 
David Roode, President, Fund Services 
Strathbridge Asset Management Inc.
Investor Relations
416.681.3966; 1.800.725.7172
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