ageas SA/NV — Earnings Release 2005

Mar 9, 2006

EMBARGO 09/03 7.30 AM CET

Press release

Brussels/Utrecht, 9 March 2006

FORTIS

Fortis realises 45% increase in 2005 net profit before results on divestments to EUR 3.5 billion

Dividend per share up 12% to EUR 1.16

Fortis CEO Jean-Paul Votron comments: ‘The model is delivering strong results. Fortis is achieving sustainable, controlled growth thanks to increased commercial activity and continued professional discipline. These excellent annual results reinforce our belief that we have taken the right strategic decisions. Implementation of these decisions is on track and we remain firmly focused on our long-term objectives.’

Net profit before results on divestments:

• Net profit before results on divestments up 45% to EUR 3,498 million from EUR 2,410 million

• Banking net profit before results on divestments up 53% to EUR 2,434 million from EUR 1,590 million

• Total revenues up 17% due to strong commercial activity and very good trading results

• Tight cost management has resulted in operating leverage of 12%; cost/income ratio has improved to 62.3%

• EUR 18 billion net new inflow of funds under management

• Change in provisions for impairment on loans stable, credit loss ratio down to 10 basis points from 13

• Insurance net profit before results on divestments up 9% to EUR 1,225 million from EUR 1,126 million

• Strong profitable top-line growth, sound cost management and favourable claims

• Gross inflow at Life up 41% to EUR 11,481 million; funds under management up 27%

• Embedded Value up 19%; Value Added by New Business at Life increased by 39%

• Gross written premiums at Non-life (excluding Assurant) up 3% to EUR 4,775 million

• Operating leverage 14%, due to profitable top-line growth and cost containment

• Combined ratio improved to 96% from 99%

• 2005 net profit up 32% on 2004 to EUR 3,941 million; earnings per share up 31% to EUR 3.07

• Fourth-quarter net profit before results on divestments amounted to EUR 461 million, up 24% on the fourth quarter of 2004, mainly due to better results at Banking

• Total proposed dividend is EUR 1.16 per share in cash, up 12% from EUR 1.04 for 2004. As interim dividend of EUR 0.52 per share was paid in September 2005, the proposed final dividend amounts to EUR 0.64 per share

| Key figures Fortis (in EUR million)^{1)} | FY 2005 | | FY 2004 Pro forma^{2)} | | Change | | | --- | --- | --- | --- | --- | --- | --- | | Net profit before results on divestments | 3,498 | | 2,410 | | 45% | | | - Banking | | 2,434 | | 1,590 | | 53% | | - Insurance | | 1,225 | | 1,126 | | 9% | | - General | | (161) | | (306) | | (48%) | | Results on divestments | 443 | | 585 | | (24%) | | | - Assurant (General) | | 443 | | 422 | | 5% | | - Seguros Bilbao (Insurance) | | | | 145 | | | | - Fortis Bank Asia (Banking) | | | | 18 | | | | Net profit | 3,941 | | 2,995 | | 32% | | | EPS (in EUR) | 3.07 | | 2.35 | | 31% | | | Before results on divestments | | 2.73 | | 1.89 | | 44% | | Net equity per share (in EUR) | 14.75 | | 11.97 | | 23% | | | Return on equity (as %) | 23.0% | | 21.6% | | | |

1. Fortis has applied the fair value option to certain items reported under Amounts due from customers, Amounts due to customers, Debt certificates and Subordinated liabilities. As a result, these items have been restated retroactively in the income statements as from 1 January 2004.
2. Fortis is publishing its financial statements for 2004 and 2005 in accordance with the new International Financial Reporting Standards (IFRS). Under IFRS, hedge accounting may not be applied retroactively to the 2004 accounts. However, to facilitate comparison, Fortis has published a pro forma net profit for 2004 taking existing hedging strategies into account. The analysis in this press release refers to movements versus the pro forma figures for 2004, which include hedge accounting.

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2

'The model is delivering strong results' comments Fortis CEO Jean-Paul Votron regarding the 45% increase in net profit before results on divestments. 'Fortis is achieving sustainable, controlled growth thanks to increased commercial activity and continued professional discipline. These strong annual results reinforce our belief that we have taken the right strategic decisions. The implementation of our strategy is on track. The delivery on all our key long-term objectives in 2005 strengthens my confidence in the future of our company.

We have put the customer at the heart of our strategy and I am happy to see intensified commercial activity reflected in top-line growth. At Banking total revenues increased by 17% and net new inflow of funds under management amounted to EUR 18 billion. At Insurance, gross inflow at Life increased by 41%.

'At each of our businesses, we have successfully invested in new customer growth, increased cross-selling and improved customer satisfaction. Major investments have been made in distribution. At Commercial & Private Banking, we have opened nine new Business Centres, of which three in new countries, and added 12 Business Centres in Turkey, bringing in new clients across Europe. At Retail Banking Belgium we have extended our opening hours and at Merchant Banking we have invested further in key growth sectors and in regions such as Asia and the United States. We have expanded our global presence by opening branches in San Francisco and Calgary. At Insurance International, we continue to roll out our insurance model, based on multi-channel distribution and forward distribution integration, including developing affinity group marketing in the United Kingdom, and strengthening our Asian business via add-on acquisitions and joint ventures.

'To serve our clients better we have shifted the mix of the workforce in favour of client-facing roles. Net hiring amounted to 700 people in 2005. The average number of training days per FTE increased by 20% to 4.2 in 2005. We also launched an intensive leadership programme for our top 3,000 managers, which is well underway.

We achieved strong new customer growth in focus areas in 2005. Commercial & Private Banking increased the number of its staff by 6% organically, while the number of new clients at Commercial Banking rose by 8% organically. We saw a 7% rise in personal banking clients at Retail Banking Belgium, where we now also have more than one million online Banking clients. Cross-selling went up too in 2005, with 20% of Private Banking's net new inflows now coming from referrals by Commercial Banking. Sales of insurance products through the banking channel increased substantially in Belgium and in the Netherlands. I am proud of customer satisfaction with our Insurance businesses. Both in Belgium and the Netherlands, broker satisfaction remained high and Fortis UK, which is the third largest car insurer in the United Kingdom, has been voted 'Motor insurer of the year' for four years out of the past five. In Belgium, we enhanced our market leadership position by successfully launching innovative products and in the Netherlands Non-life performed very well.

To complement its efforts to focus on the customer, Fortis has made good progress with consolidating all its services under one single brand. We want to build a strong reputable brand with real value for the customer - as is illustrated by our new international campaign and slogan 'Getting you there'.

'But the model is not just about growth,' Votron stresses. 'It is also about integrity and professional discipline in risk management, cost management and pricing. Our prudent risk management is reflected in low credit losses and a good claims control in Non-life. Good illustrations of our disciplined pricing policy are the adjustment of customer rates in line with the low interest-rate environment and the increase in Value Added by New Business at Life. The centralisation of support functions has resulted in a EUR 81 million cost saving, so we are on track for the EUR 100 million in cost-savings by 2006. A treasury centre will be set up in Belgium, for banking operations, leading to more efficient and transparent use of resources allocated to this activity. The increase in total costs at Fortis is in line with the expansion of several of our activities. Revenue growth and sound cost management have resulted in very strong operating leverage at both Banking and Insurance. We have expanded our activities partly by making selective acquisitions that adhered to rigorous investment criteria. Excluding investments in the quality of management and higher performance-related bonuses, costs remained stable.

'Sustainability is a key issue for Votron: 'These strong annual results show that we are delivering on our promises. We want to grow in a sustainable way. We have therefore taken important steps to enhance sustainability. A Corporate Sustainability Department has been created, we have adopted the Equator Principles and we are resolutely rolling out the Fortis Foundation concept beyond the Benelux countries. In a rapidly changing, more convergent world, innovation, speed and agility are as crucial as scale, track record and reach. To compete effectively Fortis will have to stand out as a leading international brand, known for the quality of its workforce, delivering outstanding products and services and excellent shareholder value. For the latter, I am happy to announce that the Board of Directors proposes a total cash dividend of EUR 1.16, up 12% from the EUR 1.04 for 2004.'

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3

1. Fortis

1.1. Full year 2005 compared with full year 2004

Total net profit before results on divestments went up 45% to EUR 3,498 million. This sharp increase was mainly due to very strong Banking results, while results also improved across Insurance and General.

At Banking, net profit before results on divestments (Fortis Bank Asia: EUR 18 million in 2004) went up 53% to EUR 2,434 million from EUR 1,590 million. Total revenues went up by 17% to EUR 8,991 million, while total expenses increased by 5% to EUR 5,603 million. The change in provisions for impairment on loans remained stable at EUR 209 million.

At Insurance, net profit before results on divestments (Seguros Bilbao: EUR 145 million in 2004), increased by 9% to EUR 1,225 million. The Non-life result rose 40% to EUR 475 million, while the combined ratio improved from 99% to 96%. Life net profit before results on divestments increased by 5% to EUR 748 million.

General registered a negative contribution to net profit of EUR 161 million before results on divestments compared with a loss of EUR 306 million in 2004.

Total net profit increased by 32% to EUR 3,941 million in 2005 from EUR 2,995 million in 2004. Net profit was impacted both in 2004 and in 2005 by the transactions with respect to Assurant, amounting to EUR 443 million in the first quarter of 2005 and EUR 422 million in the same quarter of 2004.

Risk-adjusted return on risk-adjusted capital (RARORAC) is a performance yardstick that indicates the relationship between the risks and returns of Fortis’s various activities. RARORAC improved considerably in 2005, on the back of the strong results: for the whole of Fortis it increased to 22% from 16% last year, The RARORAC of all the businesses was above the 15% long-term hurdle rate. The economic capital increased by 9% to EUR 15.1 billion, mainly as a result of the growing commercial activities and the change in consolidation scope.

1.2. Fourth quarter 2005

At EUR 461 million, fourth-quarter net profit before results on divestments was up 24% compared with the same quarter in 2004. Results improved substantially at Banking, while net profit before results on divestments was lower at Insurance.

As indicated earlier, the fourth-quarter net profit before results on divestments ended lower than the figure for the third quarter. As announced, the most important drivers were lower capital gains and an exceptional charge for investments in upgrading the quality of management. The fourth quarter demonstrated strong underlying commercial trends. At Banking, both net interest income and net commissions and fees went up, while capital gains and treasury and trading results came in lower. Net profit before results on divestments decreased to EUR 311 million.

Compared to the excellent results at Insurance in the third quarter, net profit before results on divestments in the fourth quarter decreased to EUR 182 million because of the investments in upgrading the quality of management and specific provision strengthening in Life and Non-life. Lower capital gains, traditional seasonality in Non-life and accelerated investments in growth also explain the difference. The underlying technical results remain sound. General reported a net loss of EUR 32 million before results on divestments (third quarter: loss of EUR 47 million).

In the fourth quarter a charge of EUR 202 million was made for the previously announced investments in upgrading the quality of management (EUR 135 million at Banking, EUR 61 million at Insurance and EUR 6 million at General). This charge consisted of (1) the cost of an intensive leadership programme for the top 3,000 managers. This programme is similar to the successful management development courses run by other leading international companies. Its objectives are to embed a performance culture and to create opportunities for current talent. It is now up and running and is an excellent way of highlighting and improving top management; (2) costs entailed by the – now completed – evaluation of the top 3,000 managers, as a result of which some people have left the company – in total less than 10% of this group; and (3) other restructuring charges deemed appropriate. The investments, which should accelerate profitable growth and enhance the productivity of senior managers and service-oriented professionals, are expected to be earned back within two years.

Fortis invested a lot in its staff in 2005. To serve customers better, the mix of the workforce has shifted towards customer-facing roles. The average number of training days per FTE increased by 20% in 2005 to 4.2.

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Net hiring amounted to 700 people. Fortis hired more than 3,800 people in 2005, whereas 3,100 people left, mostly due to retirement. The total number of FTEs increased by 11% to more than 54,000, largely because more than 5,000 new employees joined Fortis as a result of acquisitions.

Key figures Fortis (in EUR million)	Q4 2005	Q3 2005	Change
Net profit before results on divestments	461	932	(51%)
- Banking	311	620	(50%)
- Insurance	182	359	(49%)
- General	(32)	(47)	(33%)
Results on divestments	0	0
Net profit	461	932	(51%)
EPS (in EUR)	0.38	0.71	(46%)
Before results on divestments	0.38	0.71	(46%)
Net equity per share (in EUR)	14.75	14.60	1%

1.3. Solvency

in EUR billion	31 December 2005	31 December 2004
Net core capital	23.1	20.1
Legally required minimum	12.2	10.3
Net core capital as a percentage of legally required minimum	189%	196%
Fortis's floor	19.3	16.4
Net core capital as a percentage of Fortis's floor	120%	123%

Net core capital excludes any unrealised capital gains on the bond portfolio, goodwill, and any elements of embedded value.

Net core capital stood at EUR 23.1 billion on 31 December 2005, equal to 120% of Fortis's own floor.

The Tier I ratio at Fortis Bank decreased to 7.4% at the end of 2005 from 8.3% at the end of 2004. The main reasons were the strong increase in risk-weighted commitments linked to the organic growth of the businesses and the acquisition of Dişbank in the third quarter. The Tier 1 ratio has been computed based on Belgian GAAP and according to Belgian regulations. It will be computed based on IFRS as from the first quarter of 2006.

1.4. Dividend

The Board of Directors will propose a total cash dividend of EUR 1.16 per share – an increase of 12% on the EUR 1.04 paid for 2004 – to the Annual General Meeting of Shareholders on 31 May 2006. As an interim dividend of EUR 0.52 per share was paid in September 2005, the proposed final dividend will amount to EUR 0.64 per share. In keeping with the Fortis dividend policy, under normal circumstances Fortis pays an interim dividend amounting to 50% of the full-year dividend for the previous year.

Timetable final dividend for 2005

31 May 2006 Annual General Meetings of Shareholders

2 June 2006 Ex dividend date for Fortis shares

2 June 2006 Dividend election period starts

16 June 2006 Dividend election period ends

22 June 2006 Payment of the 2005 final dividend

Timetable interim dividend 2006

10 August 2006 Publication of financial statements for first half 2006

11 August 2006 Ex dividend date for Fortis shares

11 August 2006 Dividend election period starts

30 August 2006 Dividend election period ends

7 September 2006 Payment of the 2006 interim dividend

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2. Banking

| Key figures – Banking (in EUR million) | FY 2005 | FY 2004 Pro forma | Change | Q4 2005 | Q3 2005 | Change | | --- | --- | --- | --- | --- | --- | --- | | Total revenues | 8,991 | 7,692 | 17% | 2,158 | 2,212 | (2% ) | | Total expenses | 5,603 | 5,344 | 5% | 1,681 | 1,354 | 24% | | Profit before tax | 3,179 | 2,140 | 49% | 402 | 761 | (47% ) | | Net profit before results on divestments | 2,434 | 1,590 | 53% | 311 | 620 | (50% ) | | Divestments (Fortis Bank Asia) | 0 | 18 | | 0 | 0 | | | Net profit | 2,434 | 1,608 | 51% | 311 | 620 | (50% ) | | - Cost / income Ratio | 62.3% | 69.5% | | 77.9% | 61.2% | | | - Operating leverage | 12.0% | | | | | | | - Credit Loss Ratio (basis points) | 10 | 13 | | 11 | 21 | | | - Tier 1 ratio | 7.4% | 8.3% | | 7.4% | 6.8% | | | - FTEs | 41,162 | 35,805 | 15% | 41,162 | 40,476 | 2% |

2.1. 2005 compared with 2004

Net profit before results on divestments at Banking went up 53% to EUR 2,434 million from EUR 1,590 million. A sharp increase in all revenue components, moderate 5% expense growth and stable provisions for impairment on loans drove this rise. Robust growth in revenues combined with the controlled increase in costs resulted in operating leverage of 12%.

Total revenues advanced 17% to EUR 8,991 million¹. This increase derived from buoyant customer activity and strong results linked to capital markets. Net interest income from interest margin products rose by 10% to EUR 4,574 million, driven by higher revenues at all three banking businesses and the EUR 115 million contribution from Fortis Turkey. Capital gains that were not linked to financial markets remained almost stable at EUR 496 million, reflecting capital gains on the bond portfolio – mainly at the start of the year – as well as gains on the private equity portfolio. Strong trading results and the higher market value of financial market instruments drove up the results of treasury and financial markets. The high trading results in the exceptional first half of 2005 explain why these have more than doubled to EUR 1,100 million. Net commissions and fees went up 8% to EUR 2,290 million thanks to a very strong second half at both Retail and Commercial & Private Banking. The main reason for the increase in other revenues was the 15% rise in dividend and other investment income, predominantly at Merchant banking.

The change in provisions for impairment remained flat compared with 2004 at EUR 209 million. The credit loss ratio (calculated as a percentage of average credit risk-weighted commitments) dropped to 10 basis points from 13 basis points in 2004. This is substantially below the 25 to 30 basis points that is the expected average credit loss ratio over the cycle.

Net inflow at Private Banking (EUR 3.3 billion) and Fortis Investments (EUR 11.6 billion), combined with favourable market movements, resulted in a 28% increase in total funds under management to EUR 157 billion.

Total expenses were up 5% to EUR 5,603 million in 2005. Staff expenses rose by 14% to EUR 3,370 million, reflecting new hirings at Commercial & Private Banking and Merchant Banking, higher variable remuneration linked to improved results and EUR 135 million impact of investments in the quality of management, which include costs related to early departures, expenses of the leadership programme and other restructuring charges.

¹ To better reflect the underlying business trends, the analysis below is based on a different classification of net interest income, realised capital gains (losses) and realised and unrealised gains (losses). This change in classification has no impact on net profit.

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It was announced last year that the centralisation of support functions under one entity headed by Chief Operating Officer Herman Verwilst should save EUR 100 million in costs by 2006, and that this saving should grow to EUR 200-250 million per annum by 2009. Cost savings of EUR 81 million have already been achieved in 2005. In line with our policy to centralise support functions, a treasury centre for banking operations will be set up. Following an evaluation of the different options across Europe, Belgium has been chosen as the best location of this treasury centre. This will lead to more efficient and transparent use of resources allocated to this activity.

Total FTEs rose 15% to 41,162, mostly due to the integration of Fortis Turkey, the aforementioned hirings in strategic growth areas and some acquisitions, such as Dryden Wealth Management and Atradius Factoring. Other expenses came down 6%, partly as a result of the initial effects of cost-saving plans. The cost/income ratio consequently improved to 62.3% from 69.5%.

2.2. Performance per Banking Business

2.2.1. Retail Banking

| Key figures - Retail Banking | FY 2005 | FY 2004 Pro forma | Change | Q4 2005 | Q3 2005 | Change | | --- | --- | --- | --- | --- | --- | --- | | Net profit (in EUR million) | 862 | 541 | 59% | 105 | 220 | (52%) | | Cost / income ratio | 65.8% | 72.0% | | 75.5% | 64.5% | | | Operating leverage | 10.2% | | | | | | | FTEs | 14,186 | 14,509 | (2%) | 14,186 | 14,314 | (1%) |

Retail Banking achieved strong customer and sales growth in 2005, which boosted productivity and revenues substantially. Net profit jumped 59% to EUR 862 million from EUR 541 million. As a result of an 18% rise in total revenues and an 8% cost increase, operating leverage amounted to 10.2%. The cost/income ratio fell more than six percentage points to 65.8%.

Net interest income rose 7% to EUR 2,468 million, helped by the very successful ‘Summer Heat Campaign’ in Belgium. Strong volume growth was reflected in the 7% increase -to EUR 85 billion - in deposits by customers. Loans to customers went up 15% to EUR 67 billion. In the Netherlands sales of mortgages were very high, especially at Direktbank, which saw its portfolio increase 42% to EUR 12.7 billion. Net commissions and fees went up 16% to EUR 1,092 million, partly due to the sharp rise in funds under management at Fortis Investments. These went up 20% to EUR 105 billion from EUR 87 billion, lifted by net new inflow of EUR 11.6 billion.

Important steps forward have been made in the rollout of the consumer finance model. The Consumer Finance Group was set up as a separate entity in 2005. In the short term, the focus is on expansion in Germany, Poland and Turkey. In December the acquisition was announced of Von Essen, a German bank specialising in consumer finance. The enlarged scope of consumer finance activities was the main reason for the 7% increase in provisions for impairment to EUR 129 million (inclusion of International Card Services).

The 8% increase in total expenses largely reflects the aforementioned investments in upgrading the quality of management. In line with growing customer activity, the mix of the workforce has shifted towards customer-facing roles. At the end of 2005, the number of FTEs stood at 14,186, a 2% decrease on year-end 2004. While Fortis Investments and Consumer Finance stepped up hiring in order to support their growth ambitions, the total number of FTEs declined.

Retail Banking Belgium increased its share of the personal banking market. The number of personal banking customers (households with over EUR 250,000 in investable assets) rose by 7%. There was a big increase in online banking customers both in Belgium and the Netherlands. In Belgium the increase was 25% on 2004. Fortis's online banking customers in Belgium reached one million in the first quarter of 2006, representing more than 30% of the total. The majority of payment transactions were executed online last year.

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The number of online banking customers in the Netherlands more than doubled to reach 250,000 by the end of the year. The Direct Service concept was very well received by our Dutch customers and the rollout continued on schedule, involving 100 branches by year-end. Banking operations in Turkey and Luxembourg were rebranded Fortis in 2005.

2.2.2. Merchant Banking

Key figures - Merchant Banking	FY 2005	FY 2004 Pro forma	Change	Q4 2005	Q3 2005	Change
Net profit (in EUR million)	1,008	467	*	116	221	(47%)
Cost / income ratio	57.5%	71.7%		89.4%	59.8%
Operating leverage	26.2%
FTEs	4,159	3,908	6%	4,159	4,121	1%

Merchant Banking had an exceptional year in which it managed to build competitive advantage in profitable customer and product niches. Net profit soared to EUR 1,008 million, a 116% increase compared to 2004. Corporate Banking and Specialised Finance posted strong growth in net profit and accounted for 49% of the EUR 541 million increase in Merchant Banking's total net profit.

Total revenues went up 32% to EUR 2,308 million, largely due to excellent trading results, but also to robust organic growth at Corporate Banking and Specialised Finance, Global Securities and Funds Solutions. The change in provisions for impairment on loans was negative due to significant releases, mainly at Corporate & Investment Banking. The exceptional top-line growth was accompanied by tight cost control, resulting in 26.2% operating leverage.

Total expenses increased 6% in 2005, which was in line with the strategic plans and the underlying business development. Staff expenses were higher, mainly due to higher provisions for variable compensation, new hirings, and investments in upgrading the quality of management. At the end of December, the number of FTEs stood at 4,159, a 6% increase on the year.

Cross-selling between different business lines continued to improve. Specialised Finance benefited from sustained organic growth in key growth sectors such as commodities, shipping and intermodal. It expanded its global presence by opening offices focusing on specific customer needs in selected cities, such as San Francisco (intermodal) and Calgary (energy). Global Markets leveraged revenue growth from Fixed Income and Global Equities, while Global Private Equity performed well thanks to well-timed exits and the revaluation of the portfolio.

Merchant Banking invested in growth sectors and regions such as Asia and the United States in 2005. Fortis more than tripled its size and presence in the Chicago market by acquiring, and combining its existing Chicago clearing operations with, the locally based O'Connor & Company.

2.2.3. Commercial & Private Banking

Key figures - Commercial & Private Banking	FY 2005	FY 2004 Pro forma	Change	Q4 2005	Q3 2005	Change
Net profit (in EUR million)	460	491	(6%)	47	123	(62%)
Cost / income ratio	61.7%	60.5%		74.8%	58.2%
Operating leverage	(2.3%)
FTEs	6,119	5,419	13%	6,119	5,646	8%

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Commercial & Private Banking made good progress in 2005 with the implementation of the business model targeting the needs of enterprise and entrepreneur. In line with the high ambitions, substantial investments were made in the network and hiring new commercial staff. Net profit declined 6% to EUR 460 million from EUR 491 million, as substantially higher revenues failed to offset the rise in expenses and the increased change in provisions for impairment on loans.

Total revenues went up 13% to EUR 2,088 million, due to intense activity at both Commercial and Private Banking. Net interest income increased by 10% to EUR 1,030 million and net commissions and fees reached EUR 702 million (+14%). The change in provisions for impairment on loans ended up at EUR 153 million, up from the exceptionally low level of EUR 65 million in 2004. Total expenses rose 16% to EUR 1,289 million, reflecting not only ambitious new investments in the Commercial & Private Banking network and hiring staff, but also non-recurrent charges related to the restructuring of the acquired Dryden Wealth Management and investments in upgrading the quality of management. The 13% rise in total revenues, combined with the 16% increase in costs resulted in negative operating leverage. Commercial & Private Banking's total FTEs reached 6,119 at the end of 2005, up 13% (or 700 FTEs), owing to the hiring of 325 FTEs and the integration of staff from the acquired Dryden Wealth Management and Atradius Factoring.

Funds under management at Private Banking increased 33% to EUR 69.8 billion. The EUR 17.5 billion rise can be broken down into EUR 3.3 billion from net intake, EUR 8.9 billion (mainly from the acquisition of Dryden Wealth Management) and EUR 5.3 billion from market performance.

In 2005, Commercial Banking opened nine Business Centres, three of them in new European countries (Czech Republic, Hungary and Austria) and two in China (Guangzhou and Shanghai). The acquisition of Dísbank added 12 new Business Centres in Turkey, giving a total of 116 by end-2005. Cross-selling improved, with 20% of Private Banking's net new inflows now coming from referrals by Commercial Banking. Private Banking started operations in Turkey and Poland, while the acquisition of Dryden Wealth Management extended its presence to the United Kingdom, Taiwan, and Monaco. Private Banking reinforced its presence in basically all Private Banking countries.

The acquisition of Atradius Factoring has reinforced Fortis Commercial Finance's presence in Denmark, Sweden, France, Italy and Germany. Fortis Lease integrated its acquisitions in Italy and started operations in Switzerland, Portugal and the Czech Republic in 2005. In the first quarter of 2006, Fortis Lease announced the acquisition of Dreieck Industrie Leasing in Switzerland and of two leasing companies in Hungary. Fortis Intertrust set up in Russia, Poland and Dubai and launched new services such as Yacht and Aircraft Solutions jointly with Fortis Lease.

All these strategic and commercial initiatives are aimed at providing the most appropriate solutions to clients' business and wealth management needs, ultimately gaining depth and coverage. Commercial Banking added 11,000 new customers in 2005, bringing its total customer base to 90,000 customers. That amounts to 14% growth, of which 8% (or 6,000 customers) was organic.

2.2.4. Other Banking

Other Banking includes all shared service entities and corporate centre functions at Banking, Asset and Liability Management (ALM), Fortis Turkey (as of the third quarter 2005), entities sold in 2004 (Fortis Bank Asia, GWK), Fortis Hypotheekbank and, for 2004 only, International Card Services, which is recognised under Retail Banking for 2005. Both the net profit of ALM and expenses incurred by shared services are allocated to the Banking business lines.

The net profit of Other Banking increased to EUR 105 million in 2005 from EUR 91 million, as the profit contributed by Fortis Turkey more than offset the adverse effects of the reallocation of International Card Services to Retail Banking, and the fact that GWK and Fortis Bank Asia are no longer included.

Fortis Turkey, consolidated as of the second half of 2005, contributed EUR 38 million to net profit. Its total revenues amounted to EUR 182 million, of which the main components were net interest income of EUR 115 million and commissions of EUR 36 million. Total expenses stood at EUR 142 million. The fourth quarter was dominated by the successful rebranding campaign. Net interest income was lower than in the previous quarter as decreasing Turkish yields impacted the margins on commercial loans. In 2006, Fortis will continue to develop the franchise in Turkey by opening 40 new branches, in line with the aim to have around 300 branches by 2009.

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3. Insurance

| Key figures – Insurance (in EUR million) | FY 2005 | FY 2004 Pro forma | Change | Q4 2005 | Q3 2005 | Change | | --- | --- | --- | --- | --- | --- | --- | | Net profit before results on divestments | 1,225 | 1,127 | 9% | 182 | 359 | (49%) | | - Life | 748 | 711 | 5% | 127 | 206 | (39%) | | - Non-Life | 475 | 339 | 40% | 54 | 153 | (65%) | | - Other | 1 | 77 | (99%) | 1 | 0 | * | | Divestments (Seguros Bilbao) | 0 | 145 | | | | | | Net profit | 1,225 | 1,272 | (4%) | 182 | 359 | (49%) | | Operating leverage | 14.0% | | | | | | | FTEs | 13,083 | 12,931 | 1% | 13,083 | 12,843 | 2% | | Life | | | | | | | | Gross written premiums | 8,256 | 6,668 | 24% | 2,440 | 1,953 | 25% | | Investment contracts without DPF | 3,225 | 1,455 | * | 1,239 | 490 | * | | Gross inflow | 11,481 | 8,123 | 41% | 3,679 | 2,443 | 51% | | Technical result | 691 | 577 | 20% | 121 | 178 | (32%) | | Operating margin | 858 | 705 | 22% | 156 | 209 | (25%) | | Non-life | | | | | | | | Gross written premiums | 4,775 | 4,636 1) | 3% | 1,001 | 1,085 | (8%) | | Technical result | 537 | 412 | 30% | 91 | 140 | (35%) | | Operating margin | 576 | 434 | 33% | 91 | 155 | (41%) | | Combined ratio | 96% | 99% | | 100% | 95% | |

1. Excluding EUR 503 million gross written premiums at Assurant in January 2004.

3.1. 2005 compared with 2004

Net profit before results on divestments (Seguros Bilbao: EUR 145 million in 2004) increased 9% to EUR 1,225 million. The Non-life result increased by 40% to EUR 475 million, while the combined ratio improved to 96% from 99%. Life net profit before results on divestments rose 5% to EUR 748 million. Operating costs dropped 4% to EUR 1,256 million. Excluding Assurant, operating costs were up 13% due to the inclusion of Millenniumbcp Fortis, costs related to the integration of Dutch insurance operations and charges for upgrading the quality of management taken in the fourth quarter (EUR 61 million). As the operating margin increased 26%, operating leverage amounted to 14%. FTEs went up to 13,083, a 1% increase compared with year-end 2004.

3.1.1. Life

Net profit before results on divestments at Life increased to EUR 748 million (+5%) from EUR 711 million. The operating margin improved by 22% to EUR 858 million. Although the increase was across the business, more than half of it was due to better investment and mortality margins in Belgium. Millenniumbcp Fortis and the return to profitability in France were other beneficial factors. Gross inflow at Life increased 41% to EUR 11,481 million, mainly thanks to very strong sales in Belgium and Luxembourg and the performance of Millenniumbcp Fortis as from January 2005. Funds under management were 27% higher than at the end of 2004.

3.1.2. European Embedded Value and Value Added by New Business

The Embedded Value of Life insurance operations provides additional information on the value of contracts in force and of new business. The 2005 figures have been calculated in accordance with European Embedded Value (EEV) principles for the first time.

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The Embedded Value increased by $19%$ , including EUR 0.7 billion due to the move to market consistent valuation and the acquisition of Millenniumbcp Fortis. On a "like-for-like" basis (i.e. excluding Millenniumbcp Fortis and after the impact of the move to market consistent valuation), the growth would still have been $11%$ .

In EUR million
Embedded Value year-end 2004	9,738
Impact European Embedded Value	429
Model changes	(38)
Acquisition Millenniumbcp Fortis	319
European Embedded Value beginning 2005	10,448
Accrual during the year	1,133
Accrued value year-end 2005	11,581
- change year-on-year	11%
Dividend payment to Fortis	(751)
Embedded Value year-end 2005	10,830

Under EEV principles, the volume of new Life business is measured by the Present Value of New Business Premiums (PVNBP). In line with our strategy to focus on profitable growth, Value Added by New Business (VANB) grew substantially faster than new sales, resulting in a 12 basis points increase in the new business margin to $2.94%$ . The main drivers were the higher proportion of sales generated through the Banking channel in Belgium, the contribution of Millenniumbcp Fortis and improved margins at Insurance International.

In EUR million	PVNBP1)			VANB2)			New business margin
	2005	2004	Change	2005	2004	Change	2005	2004
Insurance Belgium	4,837	3,626	33%	164	134	22%	3.39%	3.70%
Insurance Netherlands	2,044	2,207	(7%)	45	55	(17%)	2.22%	2.50%
Insurance International	3,346	1,861	80%	91	28	*	2.72%	1.50%
Fortis Insurance Total	10,227	7,694	33%	300	216	39%	2.94%	2.82%

1. PVNBP = Present Value New Business Premiums.
2. VANB = Value Added by New Business.

3.1.3. Non-life

Net profit before results on divestments at Non-life increased to EUR 475 million (40%) from EUR 339 million. This sharp increase can be largely attributed to Fortis Insurance Netherlands, which benefited from strong underwriting results and higher capital gains on the investment portfolio. Fortis Insurance International also posted very strong results, supported by the continued strong performance of Fortis Corporate Insurance and Fortis UK.

Total gross written premiums at Non-life increased by $3%$ to EUR 4,775 million (excluding gross written premiums of EUR 503 million at Assurant in January 2004). All product lines, except Motor, contributed to the increase. The Non-life operating margin rose $33%$ to EUR 576 million, reflecting sharply higher technical results, particularly at Insurance Netherlands and Insurance International. All product lines contributed to this improvement. The combined ratio improved to $96%$ from $99%$ , thanks to favourable claims and a lower expense ratio at both Property & Casualty and Accident & Health.

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3.2. Performance per Insurance Business

3.2.1. Insurance Belgium

Key figures - Insurance Belgium (in EUR million)	FY 2005	FY 2004 Pro forma	Change	Q4 2005	Q3 2005	Change
Net profit	488	473	3%	76	116	(35%)
- Life	392	360	9%	76	96	(20%)
- Non-life	96	113	(15%)	0	20	*
Operating leverage	7.5%
FTEs	5,003	5,172	(3%)	5,003	4,974	1%
Life
Gross written premiums	4,139	3,670	13%	1,390	882	58%
Investment contracts without DPF	1,141	630	81%	559	219	*
Gross inflow	5,280	4,300	23%	1,949	1,101	77%
Technical result	398	335	19%	91	94	(3%)
Operating margin	478	405	18%	102	107	(5%)
Non-life
Gross written premiums	1,164	1,097	6%	265	287	(8%)
Technical result	139	127	9%	22	21	3%
Operating margin	144	143	1%	20	22	(10%)
Combined ratio	97%	98%		102%	102%

Fortis Insurance Belgium achieved very satisfying results in 2005, benefiting from its market leadership and multi-channel distribution model. Net profit went up 3% to EUR 488 million from EUR 473 million. Excluding investments in upgrading the quality of management, costs remained practically flat. This, combined with a 13% increase in operating margin, generated strong operating leverage (7.5%). The number of FTEs was down 3% to 5,003 (3,781 excluding employees of Fortis Real Estate) at the end of 2005.

Fortis Insurance Belgium managed to enhance its market leadership position. Gross inflow at Life increased 23% to EUR 5,280 million, mainly due to the success of new or recently introduced products (Planning for Pension, Top Invest plan, structured unit-linked products, Ascento, Top Rendement Invest). Both distribution channels performed strongly as regards individual life, benefiting from anticipation of the tax changes in 2006. Gross inflow at individual Life through the banking channel increased by 27% to EUR 3,148 million, partly due to successful marketing campaigns. Inflow through insurance brokers rose 19% to EUR 2,131 million. Funds under management were 14% higher than at the end of 2004. New business – expressed as annualised premium equivalent (APE) – advanced to EUR 494 million in 2005, 18% up on 2004.

Non-life gross written premiums grew 6% to EUR 1,164 million, which is a good result given the mature market. All product lines (Motor, Fire, Accident & Health and Other) contributed to this growth, which was driven mainly by a rise in the number of contracts in force. The combined ratio improved to 97% from 98% for 2004 due to a drop in the claims ratio and the cost ratio.

For the third consecutive year, the insurance broker community rated Fortis Insurance Belgium the company providing the most satisfaction, while end-customer satisfaction was also very high.

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3.2.2. Insurance Netherlands

Key figures – Insurance Netherlands (in EUR million)	FY 2005	FY 2004 Pro forma	Change	Q4 2005	Q3 2005	Change
Net profit	533	449	19%	73	185	(61%)
- Life	304	320	(5%)	48	93	(48%)
- Non-Life	230	129	79%	25	93	(73%)
Operating leverage	6.9%
FTEs	4,652	4,809	(3%)	4,652	4,711	(1%)
Life
Gross written premiums	2,635	2,542	4%	648	529	23%
Investment contracts without DPF	0	0	*	0	0	*
Gross inflow	2,635	2,542	4%	648	529	23%
Technical result	293	263	12%	39	79	(50%)
Operating margin	355	321	11%	50	89	(44%)
Non-life
Gross written premiums	1,969	2,086	(6%)	357	383	(7%)
Technical result	223	165	35%	31	74	(57%)
Operating margin	250	175	43%	31	89	(66%)
Combined ratio	92%	98%		97%	88%

In a challenging market environment, Fortis Insurance Netherlands increased its net profit by $19%$ to EUR 533 million in 2005 (2004: EUR 449 million) on the back of a steep increase in net profit at Non-life, while at the same time it maintained and solidified its market position. The launch of the Fortis ASR insurance label on 1 October 2005 was a major milestone. It created one of the largest insurers in the Netherlands and generated Fortis brand exposure for the first time in the Dutch insurance retail market. To achieve this milestone, most of the focus in 2005 was on internal alignment and streamlining and less on increasing top-line growth as can be inferred from the development of gross written premiums.

Total gross premiums remained stable at EUR 4,604 million, a strong performance given the focus on integration in 2005. Operating costs went up $8%$ to EUR 556 million and total operating margin increased $22%$ (11% Life and $43%$ Non-life), which resulted in operating leverage of $6.9%$ . The cost increase was mainly due to integration costs, the initial marketing costs of the new Fortis ASR label and extra costs in the fourth quarter for investments in upgrading the quality of management. At the end of 2005, the number of FTE's stood at 4,652, a decline of $3%$ compared with the previous year and three quarters of the targeted 750 reduction.

Net profit at Life decreased from EUR 320 million to EUR 304 million. Gross inflow at Life increased $4%$ to EUR 2,635 million. Individual life premiums showed $2%$ growth to EUR 2,212 million. Group Life went up $14%$ to EUR 423 million. The proportion of total insurance production sold through the Fortis Bank channel went up to $37%$ or EUR 16 million (APE). Funds under management were $9%$ higher than at the end of 2004. New production – expressed as annualised premium equivalent (APE) – decreased $9%$ compared with 2004, to EUR 250 million.

Net profit at Non-life rose to EUR 230 million from EUR 129 million due to strong underwriting results and higher capital gains. The combined ratio improved to $92%$ from $98%$ . Gross written premiums reached EUR 1,969 million, down $6%$ on the year. Gross premium income of Accident & Health declined from EUR 1,064 million to EUR 993 million. This decline was caused by the new long-term disability act (WIA), which has made obsolete some insurance products written in 2004 and 2005 obsolete (WAOgat and Pemba).

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3.2.3. Insurance International

Key figures - Insurance International (in EUR million)	FY 2005	FY 2004 Pro forma	Change	Q4 2005	Q3 2005	Change
Net profit	202	129	57%	32	58	(45%)
- Life	52	31	69%	2	18	(87%)
- Non-Life	150	98	53%	30	40	(26%)
Operating leverage	31.7%
FTEs	3,428	2,955	16%	3,428	3,158	9%
Life
Gross written premiums	1,482	398	*	402	543	(26%)
Investment contracts without DPF	2,085	825	*	680	271	*
Gross inflow	3,567	1,222	*	1,082	814	33%
Technical result	0	(21)	*	(9)	5	*
Operating margin	25	(20)	*	4	12	(69%)
Non-life
Gross written premiums	1,642	1,424	15%	379	416	(9%)
Technical result	175	97	80%	38	45	(17%)
Operating margin	181	94	93%	41	45	(8%)
Combined ratio	100%	102%		104%	100%

Fortis Insurance International actively supports the businesses in their goals to realise growth and to improve profitability, while at the same time investing in knowledge and skills. In 2005, it posted an excellent 57% rise in net profit to EUR 202 million from EUR 129 million. The main drivers of this increase were favourable results at Non-life (Fortis Corporate Insurance and Fortis UK), the return to profitability of French operations and the performance of Millenniumbcp Fortis (consolidated as from 1 January 2005). The performance of Millenniumbcp Fortis has substantially increased the top-line growth of Fortis Insurance International, due to its excellent sales performance and well planned and executed marketing campaigns. Operating costs went up 41% to EUR 353 million, but were more than offset by an improvement in overall profitability (demonstrated by the increase in the operating margin to EUR 206 million from EUR 74 million), resulting in operating leverage of 31.7%.

Total gross inflow at Life increased to EUR 3,567 million from EUR 1,222 million. Apart from the boost from Millenniumbcp Fortis, this robust growth was underpinned by sales growth at Fortis Luxembourg Assurances, where gross inflow surpassed EUR 1 billion.

Both technical results and gross written premiums were up at Non-life. Gross written premiums increased 15%, to EUR 1,642 million in 2005 from EUR 1,424 million in 2004, driven mainly by Millenniumbcp Fortis. Net profit at Non-life increased 53%, due to the continued excellent performance of Fortis Corporate Insurance and Fortis UK. Net profit at Fortis UK went up 22% to EUR 64 million. Fortis UK has been voted 'Motor insurer of the year' for four years out of the past five, demonstrating the underwriting and servicing capabilities of our UK franchise.

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For more information on the contents of this press release please see the ‘Financial and Operational Review’, the ‘Quarterly consolidated report’ and the ‘Embedded Value Report’. These documents are available on our website: www.fortis.com

Press conference 9 March 2006 10.30 am CET, Brussels Webcast: www.fortis.com Listen in only: +44 20 7138 0814 (United Kingdom) +31 20 713 2790 (The Netherlands) +32 2 400 3463 (Belgium)

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Fortis is an international financial services provider engaged in banking and insurance. We offer our personal, business and institutional customers a comprehensive package of products and services through our own channels, in collaboration with intermediaries and through other distribution partners. With a market capitalisation of EUR 39 billion (28/02/2006), Fortis ranks among the twenty largest financial institutions in Europe. Our sound solvency position, our presence in 44 countries and our dedicated, professional workforce of 57,000 enable us to combine global strength with local flexibility and provide our clients with optimum support. More information is available on www.fortis.com

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