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Industrial Alliance Announces a $150 Million Issue of Innovative Tier 1 Capital

Quebec City,

News Release

Final Prospectus (Innovative Tier 1 Capital)

Industrial Alliance Insurance and Financial Services Inc. ("Industrial Alliance") announced today that Industrial Alliance Capital Trust has filed a final prospectus with the securities commissions of all provinces of Canada with respect to a $150 million offering of Industrial Alliance Trust Securities - Series A ("IATS"). These securities will have an expected term of 10 years and will carry an annual yield of 5.714%, payable semi-annually. The offering is expected to close on July 4, 2003.

"We are pleased with the enthusiastic response that this offering has received on the market," states Yvon Charest, President and Chief Executive Officer of Industrial Alliance. "The issue of IATS will provide Industrial Alliance with increased financial flexibility to pursue its growth strategy. This source of financing will also allow us to optimize our capital structure, while further improving the financial solidity that characterizes the Company."

Subject to receipt of final approval from the regulatory authorities, the IATS will constitute Tier 1 capital of Industrial Alliance. The IATS will be offered by a syndicate of underwriters composed of Scotia Capital Inc., acting as lead underwriter, and Merrill Lynch Canada Inc., National Bank Financial Inc., RBC Capital Markets, Griffiths McBurney & Partners and Industrial Alliance Securities Inc.

The IATS have not been and will not be registered under the United States Securities Act of 1933, as amended, and may not be offered or sold within the United States.

About the Industrial Alliance Group
The Industrial Alliance Group is among the most solid financial institutions in the country, where it is an industry leader in insurance and financial services. The Group has operations across Canada, through Industrial Alliance (Quebec City), National Life (Toronto) and Industrial Alliance Pacific (Vancouver). The seventh largest life and health organization in Canada, the Industrial Alliance Group insures over 1.5 million Canadians, employs more than 2,150 people and administers $17.1 billion in assets. Industrial Alliance stock is listed on the Toronto Stock Exchange, under the ticker symbol IAG. Industrial Alliance is among the 100 largest public companies in Canada.

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Jacques Carrière
Vice-President, Investor Relations
Office: (418) 684-5275
Cellular: (418) 576-3624