MEDIA RELEASE
For Immediate Release

Great Eastern’s Net Profit in Q1 drops to $45.0 million
Drop is due to marked-to-market losses caused by debt and equity volatility for investments in Singapore Non-Par Fund

Singapore, 6 May 2008: Great Eastern Holdings Limited announces Profit Attributable to Shareholders of $45.0 million for 1st quarter of 2008, a decrease of 67% over the $134.5 million for 1st quarter of 2007.

Insurance Operations
The underlying insurance business remains healthy with gross premium income increase of 27% to $1.6 billion in Q1-08, new business premium increase of 51% to $857 million and new business embedded value increase of 18% to $60.4 million.

Profit from insurance operations (both life and general) totalled $14.4 million for Q1-08, a decrease of 87% year-on-year. Profit from all insurance funds in Singapore and from the general insurance fund in Malaysia is reported net of tax in the Group profit and loss statement.

Non-participating Fund registered a loss of $29.7 million in Q1-08 compared with a profit of $53.4 million in Q1-07, due primarily to a post-tax loss of $59.0 million incurred by the Singapore segment. Two main factors for the loss were (a) debt and equity market volatility which resulted in marked-to-market losses for investments and (b) an increase in the long-term insurance contract liabilities following a decline in the applicable interest rate used to discount these liabilities. The Malaysian segment reported a post-tax profit of $21.7 million (Q1-07: $23.6 million).

General insurance operations showed a profit of $7.5 million, a drop of 32% year-on-year due to weaker investment performance.

Profit from Investments
Profit from investments in the Shareholders’ Fund totalled $61.8 million, an increase of 61% over $38.3 million for Q1-07, mainly attributable to the gain on the sale of shares in the Straits Trading Co Ltd.

Fees and Other Income
Fees and other income declined 27% in Q1-08 to $22.3 million, due mainly to lower unit trust income, lower fund management fees received on reduced marked-to-market valuation for the assets under management and lower performance incentive fees.

Total Assets
The Group’s total assets as at 31 Mar 2008 amounted to $46.4 billion, a slight decrease over the $46.5 billion at 31 Dec 2007. The net asset value per share was $6.85, about 1.3% lower than $6.94 at 31 Dec 2007.

Market Share
The Group has retained its Number One position in the life insurance business in Singapore, with a market share of 25.9%, including DPS and ElderShield. Although the Malaysian figures are not finalised, we are also expected to retain our leadership position in Malaysia.

Comments from Director & Group CEO
Mr Tan Beng Lee, Director & Group CEO, said, “All segments of our insurance business reported profits amidst recent market uncertainties, except for the Singapore non-participating funds which have been affected by the accounting marked-to-market requirements for our investments and liabilities. We have been actively monitoring our exposure on the asset-liability management and will continue to ensure that our investments, in particular our bond portfolio, are of high credit quality. Part of the marked-to-market losses during the first quarter reversed as marked-to-market gains in the month of April.

“What is more important is that our underlying insurance business remains very strong, as shown in the year-on-year increases of 27%, 51% and 18% reported for gross premiums, new business premiums and new business embedded value respectively.”

Outlook for the Year
The Group’s overall performance will continue to be affected by local, regional and global economic conditions and growth. The volatility in interest rates/credit spreads and equity markets is expected to impact earnings from the non-participating funds in Singapore.

The Group continues to expand its operations in Singapore, Malaysia, China, Indonesia and Vietnam. The acceleration of activities in the regional markets will increase management expenses. It is projected that it would take a few years for operations in China, Indonesia and Vietnam to break even.

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About Great Eastern

Founded on 26 August 1908, Great Eastern Life Assurance Co Ltd has the distinction of being the oldest and most established life insurance company in Singapore and Malaysia. In November 1999, Great Eastern Holdings Ltd was incorporated and became the holding company of Great Eastern Life. Overseas Assurance Corporation Ltd, incorporated in 1920 as the first composite insurer in Singapore, merged with Great Eastern Holdings in December 2000.

Today, Great Eastern is the largest insurance group and the market leader in Singapore and Malaysia, with $46.4 billion in assets and 3 million policyholders, with two successful distribution channels - the tied agency force and bancassurance. The Company also operates in China, Indonesia and Brunei and will be starting operations in Vietnam by the middle of the year.

Great Eastern is a subsidiary of OCBC Bank, Singapore’s longest established bank with assets of $175 billion and a network of over 460 branches and representative offices in 15 countries and territories. Great Eastern’s subsidiary, Lion Capital Management, is one of the largest asset management companies in Southeast Asia.

For more information, please contact:

Loh Sook Mee
MD, Finance & Corporate Affairs
Great Eastern Life Assurance Co Ltd
Tel: 6248 2711
email: LohSookMee@lifeisgreat.com.sg

OR

Boon-Gek Mudeliar
Head, Corporate Communications
Great Eastern Life Assurance Co Ltd
Tel: 6248 2215
Email: Boon-GekMudeliar@lifeisgreat.com.sg