Premium Income Corporation Files Final Prospectus for Rights

Premium Income Corporation Files Final Prospectus for Rights Offering 
TORONTO, ONTARIO -- (Marketwire) -- 11/05/12 -- Premium Income
Corporation (TSX:PIC.A)(TSX:PIC.PR.A) (the "Fund") is pleased to
announce that it has filed a final 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 November 13, 2012 will
receive one Right for each Class A Share or Preferred Share held.  
Two Rights will entitle the holder to acquire one Class A Share and
one Preferred Share upon payment of the subscription price of $20.88.
The Toronto Stock Exchange has conditionally approved the listing of
the Rights under the symbol PIC.RT and the Class A Shares and the
Preferred Shares issuable upon the exercise thereof. It is expected
that the Rights will commence trading on November 9, 2012 and will
remain trading until noon (EST) on the expiry date of December 11,
The Fund invests in a portfolio consisting principally of common
shares of Bank of Montreal, 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.  
The exercise of Rights by holders will provide the Fund with
additional capital that can be used to take advantage of attractive
investment opportunities in the Banks and is also expected to
increase the trading liquidity of the Class A Shares and the
Preferred Shares and to reduce the management expense ratio of the
Fund. The Manager believes that current markets offer an excellent
opportunity for Shareholders to increase their exposure to the Fund
and its portfolio of the Banks. For the 4th consecutive year,
Canadian banks were ranked #1 by the Geneva based World Economic
Forum in the "Soundness of Banks" cat
egory. All 5 banks raised their
dividend in the third quarter by 3-7%. Several banks also announced
normal course issuer bids to repurchase shares.  
Consequently, the Fund believes this is an opportune time to issue
Rights to all Shareholders of the Fund to allow Shareholders to
acquire additional Shares of the Fund.  
For further information, please contact Investor Relations at
416.681.3966, toll free at 1.800.725.7172 or visit
Strathbridge Asset Management Inc.
David Roode
President, Fund Services
416.681.3966 or 1.800.725.7172 
Strathbridge Asset Management Inc.
121 King Street West, Suite 2600
Toronto, Ontario, M5H 3T9
416.681.3966 or 1.800.725.7172
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