MEDIA RELEASE
For Immediate Release

Great Eastern Holdings posts Profits of $188.6 million
in 1st Half 2006

Singapore, 10 August 2006: Great Eastern Holdings Limited announces Profit Attributable to Shareholders of $188.6 million for the first half-year ended 30 June 2006, a drop of 1% over $190.9 million for the first half of 2005.

Insurance Operations
Group gross premiums totalled $2,494.3 million in the first half of 2006, an increase of 15% from $2,175.1 million in the first half of last year, with the increase coming mainly from the Singapore sector.

Profits from all insurance funds in Singapore and from the general insurance fund in Malaysia are reported net of tax in the profit and loss statement, with effect from 2005. The comparative figures for the first half of 2005, which were previously reported on a pre-tax basis, have therefore been re-stated to take into account the income tax of $18.3 million borne by the insurance funds.

Profit from insurance operations (both life and general) decreased by 12% to $154.1 million, with 40.9% coming from Singapore, 58.7% from Malaysia, and the rest from the other Asian countries.

For life insurance operations, profit decreased by 6% from $153.9 million to $144.6 million. Profit from the Participating Fund increased by 32% to $53.1 million due to higher maturity payouts where the 90/10 bonus distribution rule applies. The Non-Participating Fund showed a 36% drop in profit to $63.2 million, due primarily to the weaker investment performance of the Singapore fund. Profit from the Investment-Linked Fund increased 81% to $28.3 million, in line with the Group’s strategy to grow the investment-linked segment in Singapore and Malaysia.

For general insurance operations, profit dropped by 57% from last year’s $22.2 million to $9.5 million. Last year’s profit had included the release of a fund solvency margin of $17.6 million, after the transfer of GEL’s general insurance business to its Non-Participating Fund. Excluding the release of $17.6 million, profit from general insurance operations for the first half of 2006 would have been double that of the corresponding half-year in 2005, contributed mainly by the sale of the shares of Robinson and Company, Limited in June 2006.

Profit from Investments
Pre-tax profit from investments of the Shareholders’ Fund totalled $67.2 million, more than double that in the first half of last year. The increase is contributed mainly by the June 2006 sale of the shares of Robinson and Company, Limited held by Shareholders’ Fund and partly by the better management of foreign currency exposures in the fixed income portfolio.

Total Assets
The Group’s total assets as at 30 June 2006 amounted to $39,041 million, compared to $39,229 million as at 31 December 2005. The net asset value per share was $5.61, 1% higher than the $5.56 half a year earlier.

Market Share
In Singapore, the Group continued to be the leader in the life insurance business with a market share of 25.7% for the first half of this year in terms of weighted premium. It is also the bancassurance distribution leader, with a market share of 41.8% in the bancassurance sector.

In Malaysia, Great Eastern continued to lead with a market share of 19.1% (based on the latest available statistics as at 31 March 2006).

Outlook for the Year
Mr Tan Beng Lee, Director & Group CEO said, “Overall, the economic outlook remains positive. In the face of higher oil and commodity prices which are expected to impact interest rate and equity markets, earnings from the Group’s insurance operations and investments will continue to be sensitive to these developments.”

The Group has intensified efforts to expand its regional footprint, stepping up recruitment of key personnel recruitment and other business activities which could result in higher management expenses. Mr Tan added, “Our joint-venture company has received the final approval from the China Insurance Regulatory Commission and has commenced life insurance business operations in Chongqing.

“In June 2006, we set up our second Representative Office in Vietnam - in Ho Chi Minh City- to explore the market environment and insurance business opportunities in South Vietnam. This Office will complement the work done by our existing Hanoi Representative Office in implementing initiatives to contribute to the development of Vietnam's life insurance industry.”

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About Great Eastern Holdings Ltd
Great Eastern Holdings is the largest insurance group in Singapore and Malaysia, with nearly S$40 billion in assets and 2.6 million policyholders. With two successful distribution channels – the tied agency force and bancassurance – it is the market leader in both Singapore and Malaysia. It is a subsidiary of OCBC Bank, Singapore’s longest established local bank which has assets of S$136 billion and a network of over 310 branches and representative offices in 15 countries and territories.

For more information, please contact

Loh Sook Mee
MD, Finance & Corporate Affairs
Tel: 6248 2711
or Email: LohSookMee@lifeisgreat.com.sg
or
Khoo Kah Siang
Head, Group Corporate Finance
Tel: 6248 2297
or Email: KhooKahSiang@lifeisgreat.com.sg
or
Boon-Gek Mudeliar
Head (Corporate Communications)
Tel: 6248 2215
or Email: Boon-GekMudeliar@lifeisgreat.com.sg

Financial Highlights