ageas SA/NV — Earnings Release 2007

Feb 28, 2008

Press release

Brussels / Utrecht, 28 februari 2008

Fortis-acquired ABN AMRO activities deliver strong performance in 2007 Pro forma 2007 results

• Underlying net profit of acquired businesses up 17% to EUR 1,355 million
• Strong commercial performance delivers resilient net interest income and growth in net commissions and fees

ABN AMRO today reports its results for full-year 2007. Fortis has decided to inform the market of the pro forma non-consolidated financial results of the ABN AMRO activities it has acquired.

On 7 March 2008, when Fortis discloses its full-year 2007 results, it will publish the net contribution of the acquired ABN AMRO activities after the impact of purchase accounting. Fortis will also publish the total impact of the acquisition on its results, including financing costs and integration costs.

Excluding the impact of the sale of Bouwfonds in 2006 and 2007, the EUR 83 million in realised capital gains on the sale of the Asset Management activities in 2006, and the integration costs taken at Asset Management activities (EUR 39 million after tax), total underlying net profit of the acquired businesses (Retail and Commercial/Corporate activities Netherlands, Private Client activities, Asset Management activities) increased 17% from EUR 1,158 million to EUR 1,355 million.

The 2007 net profit of the acquired ABN AMRO activities amounted to EUR 1,400 million. This is 29% lower than the comparable figure for 2006, which included the results from and the realised gains on the sale of Bouwfonds and the realised gains on the sale of Asset Management activities.

"Despite the volatile market conditions at the end of 2007 and uncertainty during the period of the bidding process itself, our ABN AMRO colleagues delivered an extremely robust financial performance in 2007," commented Jean-Paul Votron, CEO of Fortis. "ABN AMRO maintained strong customer momentum during this period, with minimal client attrition and higher customer satisfaction levels reported. This performance validates our strong conviction that the combination of Fortis and ABN AMRO represents a compelling proposition for both our employees and our clients, and it is clear from these results that we have a strong base from which to grow in the future. We are fully on track with the integration of ABN AMRO's activities and expect the asset management integration process to be completed over the coming weeks, followed by private banking by the end of the year and retail banking and commercial/corporate activities by the end of 2009."

The strong underlying commercial performance led to resilient net interest income and net commissions and fees. Net interest income was flat year-on-year at EUR 3,328 million, but showed robust growth in the fourth quarter. The increase was fuelled in part by the growth of market share in deposits achieved at Retail and Commercial/Corporate activities Netherlands in the fourth quarter, as corporate uncertainty around ABN AMRO subsided. Net commissions and fees advanced 9% to EUR 2,339 million in 2007. All acquired businesses contributed to this growth.

Total expenses increased 3% to EUR 4,188 million from EUR 4,077 million. Staff expenses grew 11% year-onyear driven mainly by one-off share-based payments related to the acquisition. The number of FTEs increased 0.5% from 25,118 to 25,234.

Key underlying figures
in EUR million
PRO FORMA	FY 2007	FY 2006	Change
Underlying net profit acquired ABN AMRO activities (pro forma)	1.355	1.158	17%
- Retail and Commercial/Corporate activities Netherlands	854	753	13%
- Private Clients activities	307	253	21%
- Asset Management activities	194	152	28%

in EUR million
PRO FORMA	FY 2007	FY 2006	Change
Net interest income on interest-margin products	3.328	3.360	(1%)
Net commissions and fees	2.339	2.138	9%
Capital gains on investment portfolio	85	162	(48%)
Treasury and financial markets	314	218	44%
Dividend and other investment income	64	55	16%
Other income (1)	297	498	(40%)
Total income	6,427	6,431	$0\%$
Change in impairments	(379)	(382)	(1%)
Net revenues	6.047	6,049	0%
Staff expenses	(1,927)	(1,735)	11%
Other operating and administrative expenses	(2,260)	(2.342)	(3%)
Total expenses	(4, 188)	(4,077)	3%
Profit before taxation	1,860	1.972	(6%)
Income tax expenses	(482)	(478)	1%
Net profit for the period	1,378	1,494	(8%)
Net profit attributable to minority interests	30	20	55%
Results on discontinued operations	52	505	(90%
Net profit acquired ABN AMRO activities (pro forma)	1,400	1,980	(29%)
- Retail and Commercial/Corporate activities Netherlands	906	1,258	(28%)
- Private Clients activities	307	253	21%
- Asset Management activities	155	235	(34%)
- Shared Assets	32	233	(86%)
(1) Includes net profit of Shared Assets

.
PRO FORMA	FY 2007	FY 2006	Change
Net profit acquired ABN AMRO activities (pro forma)	1.400	1.980	(29%)
- Shared Assets	(32)	(233)
- Results on discontinued operations (Bouwfonds)	(52)	(505)
- Capital gains on divestments (Asset Management activities)		(83)	۰
- Integration costs (Asset Management activities)	39
Underlying net profit acquired ABN AMRO activities (pro forma)	1.355	1.158	17%
- Retail and Commercial/Corporate activities Netherlands	854	753	13%
- Private Clients activities	307	253	21%
- Asset Management activities	194	152	28%

Retail and Commercial/Corporate activities Netherlands

There are three main differences between the scope of BU Netherlands at ABN AMRO and that of the Retail and Commercial/Corporate activities acquired by Fortis. Fortis excludes the following activities:

• Global Clients and former Wholesale Clients Netherlands activities
• Global Markets businesses that formed part of BU Netherlands
• Interbank/DMC

Analysis

• Underlying net profit up 13% to EUR 854 million in 2007, reflecting a resilient commercial performance driving income and commissions
• Savings volumes grow in the fourth quarter, as ABN AMRO recovered market share lost earlier due to corporate uncertainty during the bidding period
• Retail customer satisfaction rates improve in the fourth quarter

Full-year net profit amounted to EUR 906 million in 2007, 28% lower than in 2006. The 2006 figure included results on discontinued operations of EUR 505 million related to the sale of Bouwfonds. For 2007, discontinued operations include a release of provisions related to the 2006 sale of Bouwfonds. Excluding these effects, underlying net profit for the period increased by 13% from an adjusted EUR 753 million in 2006 to EUR 854 million in 2007. A strong underlying commercial performance delivered resilient income despite the flattening of the yield curve, supported by tight cost control and a decrease in the corporate tax rate.

Net interest income on interest-margin products remained stable in 2007 at EUR 2,841 million and showed robust growth in the fourth quarter. Resilient volumes in deposits and in loans to customers sustained net interest income. Savings volumes, together with market share, recovered well in the latter part of the year from the downward pressure exerted by corporate uncertainty during the bidding period. Margins on consumer and commercial savings products also improved year-on-year. There was a shift from savings accounts to time deposits, especially in the fourth quarter.

Solid economic expansion helped drive healthy loan growth, with loan volumes for the consumer and commercial client business advancing 4%. Margins were under pressure, however, in an increasingly competitive market.

The mortgage portfolio increased by 6% to EUR 84 billion. The overall mortgage market in the Netherlands is contracting as a result of the stagnation in the number of residential building permits as well as rising mortgage interest rates. The impact of the lower number of housing transactions is partly offset by the size of the average mortgage amount, which reflects the increase in average house prices of between 5% and 6% year-on-year. Rising mortgage rates led to a decline in refinancings. ABN AMRO's market share in new mortgage production grew from 10.9% to 12.4%. The market share of the ABN AMRO label remained constant while the Florius label, which is aimed at the independent broker channel, improved following its successful introduction in March 2006. Margins on the mortgage portfolio remained under pressure.

Net commissions and fees grew 4% to EUR 756 million in 2007. In addition to the growth at transaction banking, a rise in insurance commissions as well as higher volumes in investment transactions for retail clients contributed to this increase.

Treasury and financial markets posted a 62% increase to EUR 199 million, due to higher income on deals executed for Commercial Banking clients and the higher sales of interest hedging products to SME clients.

The change in provisions for impairments increased 10% at EUR 375 million, mainly due to exceptionally high additions within Commercial Banking, which were partly offset by improvements in the SME and consumer portfolios.

Total expenses remained stable at EUR 2,609 million, as an increase in staff expenses was offset by a decrease in other operating and administrative expenses.

Income tax expenses decreased in 2007, mainly as a result of the lowered corporate tax rate in the Netherlands in 2007.

Distribution channels and customer satisfaction

ABN AMRO launched a completely redesigned Internet site for consumer banking in the fourth quarter of 2007. Retail customer satisfaction improved in the fourth quarter of 2007.

Income Statement - Activity-based
in EUR million
PRO FORMA	FY 2007	FY 2006	Change
Net interest income on interest-margin products	2.841	2.832	0%
Net commissions and fees	756	729	4%
Capital gains on investment portfolio	63	70	(10%
Treasury and financial markets	199	123	62%
Dividend and other investment income	55	49	12%
Other income	181	193	(6%)
Total income	4,094	3.997	2%
Change in impairments	(375)	(341)	10%
Net revenues	3,720	3,656	2%
Staff expenses	(1, 158)	(1, 106)	5%
Other operating and administrative expenses	(1.450)	(1.505)	(4% )
Total expenses	(2,609)	(2,610)	0%
Profit before taxation	1,111	1,046	6%
Income tax expenses	(257)	(292)	(12%)
Net profit for the period	854	754	13%
Net profit attributable to minority interests	1	$\mathbf{0}$	45%
Results on discontinued operations	52	505	(90%
Net profit attributable to shareholders	906	1,258	(28%)

Private Client activities

There are two main differences between the scope of BU Private Clients at ABN AMRO and that of the Private Clients activities acquired by Fortis. At Fortis:

• International Diamonds & Jewellery Group (ID&JG) is included
• The proceeds of the sale of the Latin American Private Banking operations in Miami (net EUR 72 million) are booked in Shared Assets.

Analysis

• Net profit rose 21% despite smaller scope resulting from strategic divestments
• Net commissions and fees up 11%, driven by resilient commercial activity
• Funds under management down 3% to EUR 138 billion, as net inflow of EUR 2.3 billion in 2007 was offset by financial markets developments and strategic divestments. Private Clients managed to retain and grow its client base despite corporate uncertainty during the bidding period

Full-year net profit amounted to EUR 307 million, 21% higher than in 2006. A steep rise in the profit contribution from ID&JG (from EUR 3 million in 2006 to EUR 28 million in 2007) contributed to the increase in net profit.

Notwithstanding difficult market conditions and the corporate uncertainty during the bidding period, the client base of Private Clients (excluding divestments) was maintained and, in fact, increased in 2007 by 1.5% compared to 2006.

Total income came in at EUR 1,366 million in 2007, up 5% on 2006 due to higher net commissions and fees.

Net interest income on interest-margin products came to EUR 505 million in 2007, down 7% compared with 2006, due to strong pressure on margins resulting from the flattening yield curve in 2007. This primarily impacted savings accounts.

Net commissions and fees increased 11% year-on-year, driven by higher volumes in non-interest-related products such as stocks, investment funds and structured products.

Funds under management decreased from EUR 142 billion at year-end 2006 to EUR 138 billion at the end of 2007. Net inflow of EUR 2.3 billion in 2007 was more than offset by the decrease in funds under management following the divestments of Vermogensgroep and the Private Client business in the UK, and by financial market conditions.

Capital gains on investment portfolio included the gain of EUR 7 million net on the sale of the Private Client business in the UK in 2007.

Treasury and financial markets increased 27% to EUR 78 million as Private Clients was successful in introducing new private investment products to the market.

Other income grew 15% to EUR 82 million, partly due to increased insurance results from Neuflize Vie in France.

The change in provisions for impairments came in 90% lower at EUR 4 million in 2007. Provisioning decreased mainly at ID&JG, from EUR 34 million in 2006 to EUR 4 million in 2007.

Total expenses reached EUR 927 million in 2007, 4% higher than in 2006. The 2006 figures include a restructuring cost release (EUR 27 million gross). Adjusting for this release, total operating expenses were virtually flat (+0.7%), reflecting better cost management across all regions.

The number of FTEs at Private Clients decreased 5% to 3,096, due to the scope changes described above. Staff attrition remained low throughout the year. Staff expenses were up 10% compared with 2006, mainly driven by one-off release of restructuring costs in 2006 and share-based payments in the fourth quarter related of 2007 to the acquisition.

in EUR million
PRO FORMA	FY 2007	FY 2006	Change
Net interest income on interest-margin products	505	543	(7%)
Net commissions and fees	689	618	11%
Capital gains on investment portfolio	11	4	$\star$
Treasury and financial markets	78	61	27%
Dividend and other investment income	$\mathbf{0}$	3	(97%)
Other income	82	71	15%
Total income	1,366	1,300	5%
Change in impairments	(4)	(41)	(90%
Net revenues	1.362	1,259	8%
Staff expenses	(354)	(323)	10%
Other operating and administrative expenses	(573)	(569)	1%
Total expenses	(927)	(892)	4%
Profit before taxation	434	367	18%
Income tax expenses	(124)	(113)	10%
Net profit for the period	310	255	22%
Net profit attributable to minority interests	3	1	$\star$
Results on discontinued operations	$\overline{\phantom{a}}$	ä,	$\star$
Net profit attributable to shareholders	307	253	21%

Asset Management activities

There are only minor differences between the scope of BU Asset Management at ABN AMRO and that of the Asset Management activities acquired by Fortis.

Analysis

• Underlying net profit up 28% to EUR 194 million, as 2007 is impacted by restructuring costs related to the merger with Fortis Investments, and 2006 results included gains on divestments
• Assets under management increased slightly as market appreciation offset outflow due to corporate uncertainty during the bidding period and focus on profitability
• DNB grants permission for demerger of ABN AMRO Asset Management. Management and investment teams of combined entity have been selected
• Fortis to sell ABN AMRO's asset management activities in Brazil to Santander

Full-year net profit amounted to EUR 155 million, 34% lower than the EUR 235 million recorded in 2006. The 2006 results included tax-exempt gains on the sale of the Asset Management operations in Curacao (EUR 28 million), the sale of the domestic asset management operations in Taiwan (EUR 38 million) and the sale of the United States mutual fund business (EUR 17 million). These sales explain the higher capital gains on the investment portfolio in 2006 compared with 2007. The 2007 result was impacted by the integration provision booked at the Asset Management activities. Excluding these factors, underlying net profit went up 28% to EUR 194 million.

Net commissions and fees advanced 13% to EUR 894 million, reflecting higher fee levels on existing products and the focus on high-margin products.

Assets under management amounted to EUR 194 billion compared with EUR 192 billion at the end of 2006. In spite of uncertain conditions, Asset Management activities was able to limit the outflow of assets under management. Some reduction can also be explained by a focus on more profitable mandates. Market appreciation more than offset these two factors.

Total expenses increased 13% to EUR 652 million in 2007. This can be explained by the EUR 50 million in costs related to the integration of Asset Management activities into Fortis Investments. Staff expenses were also impacted by higher bonus accruals following improved performance, and by one-off share-based payments in the fourth quarter related to the acquisition. The number of FTEs increased 9% to 1,784 in 2007.

Income tax expenses were 38% higher in 2007, as 2006 included one-off tax exempt gains and 2007 a write-off of a deferred tax asset.

At the end of January 2008, Fortis received permission from the Dutch central bank (DNB) concerning the proposed demerger of ABN AMRO Asset Management (AAAM) from ABN AMRO bank. This demerger should be completed by 1 April 2008. Fortis has already started the seamless integration of AAAM with Fortis Investments.

The combination of the two asset managers creates a top tier asset manager with a global geographic footprint, i.e. present in more than 30 countries worldwide, with upwards of 40 investment centres and more than 2,000 employees. The combined entity will provide an enhanced offering to institutional clients and third-party distributors alike.

On 27 February 2008 Fortis and Santander announced that they have reached an agreement by which Santander will purchase from Fortis the Brazilian asset management activities of ABN AMRO, which Fortis acquired as part of the Consortium's (RBS, Fortis and Santander) purchase of ABN AMRO. Fortis will retain the Latin American (ex-Brazil) institutional sales and some equity investment teams related to funds distributed through ABN/Fortis channels. This transaction, which amounts to approximately EUR 209 million, should be finalised in the second quarter of 2008, subject to customary closing conditions and regulatory approvals.

in EUR million
PRO FORMA	FY 2007	FY 2006	Change
Net interest income on interest-margin products	(18)	(15)	17%
Net commissions and fees	894	790	13%
Capital gains on investment portfolio	11	88	(88%)
Treasury and financial markets	37	34	8%
Dividend and other investment income	9	3	$\star$
Other income	3	1	$\star$
Total income	935	901	4%
Change in impairments	(1)	0	$\star$
Net revenues	934	901	4%
Staff expenses	(415)	(306)	36%
Other operating and administrative expenses	(236)	(268)	(12%)
Total expenses	(652)	(574)	13%
Profit before taxation	283	326	(13%)
Income tax expenses	(101)	(73)	38%
Net profit for the period	182	253	(28%)
Net profit attributable to minority interests	27	18	48%
Results on discontinued operations	0	0	×
Net profit attributable to shareholders	155	235	(34%)

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 32.8 billion (31/01/2008), Fortis ranks among the 15 largest financial institutions in Europe. Our sound solvency position, our presence in more than 50 countries and our dedicated, professional workforce of 60,000 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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