BAC Canada Finance Company

Headnote

National Policy 11-203 Process for Exemptive Relief Applications in Multiple Jurisdictions -- relief from eligibility requirements under NI 44-102 for reporting issuer whose credit supporter's equity securities are not listed on a short form eligible exchange -- issuer is a wholly-owned subsidiary -- issuer is a substantial global financial services provider -- parent company provides full and unconditional credit support for the securities being distributed -- equity securities of parent listed on New York Stock Exchange.

Applicable Legislative Provisions

National Instrument 44-102 Shelf Distributions, ss. 2.2, 11.1.

March 7, 2011

IN THE MATTER OF

THE SECURITIES LEGISLATION

OF ONTARIO (THE JURISDICTION)

AND

IN THE MATTER OF

THE PROCESS FOR EXEMPTIVE RELIEF

APPLICATIONS IN MULTIPLE JURISDICTIONS

AND

IN THE MATTER OF

BAC CANADA FINANCE COMPANY

(the Filer)

DECISION

Background

The principal regulator in the Jurisdiction has received an application from the Filer for a decision (the Exemption Sought) under the securities legislation of the Jurisdiction of the principal regulator (the Legislation) for an exemption, pursuant to subsection 11.1(1) of National Instrument 44-102 -- Shelf Distributions (NI 44-102), from the requirements in subsection 2.4(1) and subparagraph 2.4(3)(b)(v) of NI 44-102 which would otherwise require that equity securities of Bank of America Corporation (BAC), as credit supporter, be listed and posted for trading on a short form eligible exchange (as defined in National Instrument 44-101 Short Form Prospectus Distributions (NI 44-101) in order for the Filer to distribute by short form prospectus debt securities (Debt Securities) or cash-settled structured warrants (Structured Warrants).

Under the Process for Exemptive Relief Applications in Multiple Jurisdictions (for a passport application):

(a) the Ontario Securities Commission is the principal regulator for this application, and

(b) the Filer has provided notice that section 4.7(1) of Multilateral Instrument 11-102 -- Passport System (MI 11-102) is intended to be relied upon in all of the provinces of Canada other than Ontario.

Interpretation

Terms defined in National Instrument 14-101 -- Definitions, MI 11-102, NI 44-101 and NI 44-102 have the same meaning if used in this decision, unless otherwise defined.

Representations

This decision is based on the following facts represented by the Filer:

1. The Filer, an indirect wholly-owned subsidiary of BAC, is an unlimited company incorporated under the Companies Act (Nova Scotia) having its registered office at Suite 800, 1959 Upper Water Street, Halifax, Nova Scotia B3J 2X2 and its head office at Brookfield Place, Suite 400, 181 Bay Street, Toronto, Ontario M5J 2V8.

2. BAC is a Delaware corporation, a bank holding company and a financial holding company under the U.S. Gramm-Leach-Bliley Act. Its principal executive offices are located in the Bank of America Corporate Center, 100 North Tryon Street, Charlotte, North Carolina 28255.

3. As of December 31, 2009, BAC was among the largest financial institutions in the world measured by total assets. As of that date, BAC had total assets of US$2,223 billion and total shareholders' equity of US$231 billion.

4. Certain of the Debt Securities will be issued under an indenture dated as of October 1, 2009 between the Filer, BAC and CIBC Mellon Trust Company, as trustee (the Indenture).

5. All amounts payable by the Filer under the Debt Securities and the Structured Warrants will be fully and unconditionally guaranteed by BAC.

6. The principal market on which BAC's common stock is traded is the New York Stock Exchange (NYSE). BAC's common stock is also listed on the London Stock Exchange.

7. The Filer is a reporting issuer in each of the provinces of Canada and is not in default of securities legislation in any province of Canada. BAC is a reporting issuer in each of the provinces and territories of Canada and is not in default of securities legislation in any province or territory of Canada.

8. The Filer filed a short form base shelf prospectus dated September 28, 2009 (the Prospectus). The Filer was qualified to file the Prospectus because it satisfied the alternative qualification criteria for issuers of guaranteed non-convertible debt securities, preferred shares and cash settled derivatives set out in section 2.4 of NI 44-101 and section 2.4 of NI 44-102.

9. The Filer has obtained approved ratings (as defined in NI 44-101) from Standard & Poor's Ratings Services, a Standard & Poor's Financial Services LLC business (S&P), Moody's Investors Service Ltd. (Moody's) and Fitch Inc. (Fitch) for its program (the Program) of issuance of medium-term notes (the Notes) pursuant to the Indenture and a prospectus supplement dated October 1, 2009. These ratings are assigned to the Program and not to a specific issuance of Notes.

10. In June 2009 Moody's announced it would no longer assign new public ratings to bonds, notes, or preferred stock for which the amount of promised principal repayment is dependent on the occurrence of a non-credit event or the performance of an index. S&P announced in December 2009 that it would no longer rate obligations with variable principal payments linked to commodity prices, equity prices, or indices linked to either commodity or equity prices. At the date hereof none of S&P, Moody's and Fitch will provide a rating for a specific issuance of non-principal protected Notes. As a result, absent the granting of the Exemption Sought, the Filer would not be qualified under Part 2 of NI 44-102 to file a renewal preliminary base shelf prospectus and final base shelf prospectus qualifying the distribution of non-principal protected Notes.

11. The Filer satisfies the alternative qualification criteria set forth in section 2.4 of NI 44-101 and section 2.4 of NI 44-102, other than the requirement that BAC, as credit supporter providing full and unconditional credit support for the securities qualified by the Prospectus, has equity securities listed and posted for trading on a short form eligible exchange.

12. The Filer does not plan to seek ratings for the specific issuances of Debt Securities under the Prospectus.

Decision

The principal regulator is satisfied that the decision meets the test set out in the Legislation for the principal regulator to make the decision.

The decision of the principal regulator under the Legislation is that the Exemption Sought is granted so long as:

(i) BAC provides full and unconditional credit support for the securities being distributed under the Prospectus or any renewal short form base shelf prospectus;

(ii) BAC is a U.S. credit supporter (as defined in NI 44-101) and the Filer is incorporated or organized under the laws of Canada or a jurisdiction of Canada;

(iii) BAC is not an issuer:

a. whose operations have ceased; or

b. whose principal asset is cash, cash equivalents, or its exchange listing;

(iv) the shares of BAC common stock are listed and posted for trading on the NYSE or any successor thereof;

(v) each shelf prospectus supplement qualifying non-principal protected Debt Securities distributed under a short form base shelf prospectus of the Filer includes cover page disclosure that:

a. the non-principal protected Debt Securities are not rated;

b. any non issue specific credit rating applicable to Debt Securities only applies to credit-related factors such as the Filer's ability to make any payments it would be obligated to make under the Debt Securities;

c. any non issue specific credit rating applicable to Debt Securities does not apply to non-principal protected Debt Securities and, for so long as S&P, Moody's and Fitch continue not to rate non-principal protected Debt Securities, an explanation to that effect; and

d. an investor's principal is at risk as a result of non credit-related factors such as the performance of the underlying reference asset; and

(vi) the Filer files before or concurrently with any renewal short form base shelf prospectus an undertaking that it will not distribute in any local jurisdiction under such prospectus specified derivatives that, at the time of distribution, are novel without pre-clearing with the regulator the disclosure contained in a shelf prospectus supplement pertaining to the distribution of the novel specified derivatives, in accordance with subsection 4.1(2) of NI 44-102.