MEDIA RELEASE
For Immediate Release

Great Eastern posts Profit of $301.0 million in 9 Months of 2006

Singapore, 9 November 2006: Great Eastern Holdings Limited announces Profit Attributable to Shareholders of $301.0 million for the first 9 months of 2006, an increase of 7% over $280.9 million for the corresponding period in 2005.

Insurance Operations
Group gross premiums totalled $3,849 million in the period Jan-Sep 2006, an increase of 8% from $3,552 million in the corresponding period last year.

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 2005, which were previously reported on a pre-tax basis, have therefore been re-stated to take into account the income tax of $33.2 million borne by the insurance funds for the 9 months last year.

Profit from insurance operations (both life and general) totalled $262.8 million, with 48.7% coming from Singapore, 51.1% from Malaysia, and the rest from the other Asian countries. 

For life insurance operations, profit increased by 8% from $233.0 million to $250.6 million. Profit from the Participating Fund increased by 24% to $75.9 million, mainly due to higher maturity payouts where the 90/10 bonus distribution rule applies. The Non-Participating Fund showed a small drop of 3% in profit to $135.3 million, although the 3rd quarter in 2006 itself showed a 76% increase due to the improved investment performance in the quarter compared to the preceding two quarters and the 3rd quarter in 2005. Profit from the Investment-Linked Fund increased 20% to $39.4 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 60% from last year’s $30.6 million to $12.2 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.

Profit from Investments
Pre-tax profit from investments of the Shareholders’ Fund totalled $85.9 million, an increase of 82% over the corresponding period last year. The increase is contributed mainly by the June 2006 sale of the shares of Robinson and Company, Limited held by Shareholders’ Fund.

Fees and Other Income
Pre-tax fees and other income for the 9 months totalled $50.7 million, 22% higher than the $41.5 million last year.  The increase in fee income was contributed by the asset management subsidiaries, Lion Capital Management Ltd and Lion Fairfield Capital Management Ltd, and the financial advisory subsidiary, Alpha Financial Advisers Pte Ltd. 

Total Assets
The Group’s total assets as at 30 Sep 2006 amounted to $40,188 million, compared to $39,229 million as at 31 Dec 2005.  The net asset value per share was $5.82, about 5% higher than the $5.56 at year-end 2005.

Market Share
In Singapore, the Group is expected to retain its leadership position in the life insurance business with an estimated market share of about 25% in terms of weighted premium for the first nine months of this year.  It is also expected to be the bancassurance distribution leader, with a market share of about 37% in the bancassurance sector.

In Malaysia, Great Eastern is also expected to lead with a market share of about 21% in terms of weighted premiums for the first nine months of this year.

Outlook for the Year
Mr Tan Beng Lee, Director & Group CEO said, “We are pleased with the 3rd quarter’s performance. The profit of $112.4 million is the best quarterly performance to-date, if we exclude the 2nd quarter of 2004 when we realised profits from the disposal of the investment in OCBC shares.

Overall, the economic outlook remains largely positive. However, earnings from the Group’s insurance operations and investments will continue to be sensitive to changes in interest rates and in the commodity and equity markets.”

The Group has intensified its efforts to expand its regional footprint, particularly in the area of key personnel recruitment and other business activities which would result in higher management expenses. The regional focus includes Malaysia, China, Indonesia and Vietnam. 

About Great Eastern Holdings Ltd
Great Eastern Holdings is the largest insurance group in Singapore and Malaysia, with over 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$134 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