1

Meritz Insurance

Non-Deal Roadshow

June 18 ~ 22, 2007

MERITZ

2

DisclaimerMERITZ

「Meritz Insurance」has been prepared based on internally audited figures and final figures may change due to the results of independent auditors’ audit without notice.

This presentation includes forward looking statements regarding the company’s outlook for FY’07 and beyond, including projected premium and net income. These forecasts are subject to unknown risks and uncertainties that may cause actual figures to differ from those stated or implied by such statements. We have no obligation or responsibility to investment made based on such forward looking statements.

3

1. Who we are

2. Investment Focus

3. FY06 Financial Results Summary

4. FY07 Strategies and Outlook

5. Frequently Asked Questions

※ Appendix : FY’06 Financials

AgendaMERITZ

4

1. Who we are

2. Investment Focus

3. FY06 Financial Results Summary

4. FY07 Strategies and Outlook

5. Frequently Asked Questions

※ Appendix : FY’06 Financials

ContentsMERITZ

5

Corporate OverviewMERITZ

▶ 5th largest non-life insurer in premiums with strong bottom line strength

10

9

8

7

6

5

4

3

2

1

1.9%Green

2.6%Daehan

2.7%SsangYong

3.1%Hanwha

3.5%First Fire

8.0%Meritz

LIG

Dongbu

Hyundai

Samsung

14.4%

14.9%

15.5%

30.2%

155.4Dongbu

24.1LIG

76.3Hyundai

-93.8Ssangyong

-48.0Hanwha

5.4Green

9.6Daehan

10.5First Fire

Meritz

Samsung

47.5

379.5

7.3%Daehan

7.7%Green

11.7%First Fire

11.7%Hyundai

-58.4%Ssangyong

-39.0%Hanwha

3.3%LIG

Samsung

Meritz

Dongbu

9.9%

13.7%

18.3%

[ Premium Written Market Share ] [ Adjusted Net Income ]

In KRW billion

[ Adjusted ROE ]

*As of FY06 (Apr. ’06~ Mar. ’07), Market share including mono-line insurers

1

6

0.00

100.00

200.00

300.00

400.00

500.00

600.00

2004-04-01 2004-10-01 2005-04-01 2005-10-01 2006-04-01 2006-10-01 2007-04-01

Meritz KOSPI Insurance sector

Corporate OverviewMERITZ

▶ Market Cap : KRW 801.4 billion (U$ 862 million) as of May ‘07

Adjusted EPS: KRW 554Adjusted BPS: KRW 4,575 52 week high / low : KRW 9,490 / 4,420

▶ Relative stock price performance Outperforming KOSPI by 347%Outperforming Insurance sector index by270%

Launched new corporate identity

Meritz Inv. Bank shares acquired

Meritz Securities shares acquired

▶ Recent ChangesDisaffiliation from Hanjin Group in March ‘05New CEO – Mike Wohn - on board in June ’05, launching “Profit-focused” strategyBrand change in Oct. ’05 : “Oriental F&M” “Meritz Insurance”Financial Group plan initiated with Securities and Investment Bank company

SecurtiesSecurties

Inv.Inv.BankBank

57.2%

28.8%

Insurance

13.0%

1

7

Product MixMERITZ

▶ Our Product Mix

Total

Long-term

Auto

Commercial

7.8

6.8

7.8

11.5

FY03

7.9

7.5

7.8

9.9

FY04

7.9

8.2

7.1

9.3

FY05

8.0

8.6

7.0

8.5

FY06

FY03 FY04 FY05 FY06

Commercial Auto Long-term

19.2% 15.8% 14.6% 12.6%

39.9% 33.1%

52.3%

38.9%

40.9%45.2%

30.8%

56.6%1,544

1,6951,877

2,180

Total

Long-term

Auto

Commercial

0.9

8.3

-0.2

-10.0

FY03

8.2

21.2

7.2

-9.3

FY04

9.5

28.1

-5.8

1.9

FY05

16.2

25.8

8.0

0.1

FY06

[ Growth Rate by Line(%) ] [ Premium Market Share(%) ]

Health, Accident, etc.Multi yearLong-term

CALI1 yearAuto

Fire, Marine, Cargo, Hull, Liability, etc.

1 yearCommercial

ExampleContract Period

Portfolio

*Long-term: Protection-type (Health, Accident, etc.),

Savings-type (maturity refund): similar to bank

term deposits

[ Premium Mix in KRW billion ]

1

8

1,549

2,057

1,252

3,324

2,436

526

899 1,484 1,884

2,475

3,786

4,1294,910

536474 405 349

16319513595

2,080

1,9931,947

FC TC general solicitors general agencies specialized agencies internal employees

Distribution ChannelMERITZ

▶ Distributing our product through solicitors and agentsSolicitors: Tied individual salespersons

- Financial Consultants, Total Consultants, etc.Agents: Tied or independent agencies

- Long-term line specialized agencies, bank (bancassurance), etcInternal employees (primarily commercial lines)

9,266 9,179 10,386 10,252

▶ Solicitors and agents commission is based on their sale

1

[ Number of Sales Force Trend ]

FY03 FY04 FY05 FY06

Total

9

Shareholder StructureMERITZ

▶ Major shareholder’s share: 22.4%Cho Jung-Ho: 22.3%.(19,160,310 shares), Cho Nam-Ho: 0.10% (84,930 shares)

Shareholders (March ’07)

Domestic49.5%

ESOP0.5%

Jung-Ho Cho &Nam-Ho Cho

22.4%

Treasury shares7.6%

Foreigners19.9%

▶ Free Float: 69.5%Foreigners: 19.9%, Domestic: 49.5%

1

10

Dividend Track RecordMERITZ

▶ Dividend history

22.1%1.3%KRW 35.8B KRW 100FY2006

29.6%2.4%KRW 26.4B KRW 100FY2005

36.7%4.9%KRW 21.1BKRW 100FY2004

38.7%5.5%KRW 20.0BKRW 100FY2003

22.7%8.6%KRW 34.0BKRW 100FY2002

17.7%5.4%KRW 43.7BKRW 100FY2001

Payout ratioDividend ratioNet incomeDividend amount

*10:1 stock split in Feb. 23, 2006

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11

1. Who we are

2. Investment Focus

3. FY06 Financial Results Summary

4. FY07 Strategies and Outlook

5. Frequently Asked Questions

※ Appendix : FY’06 Financials

ContentsMERITZ

12

High Long-term Line GrowthMERITZ

21.2%

25.8%28.1%

19.4%15.9%

12.5%

Meritz Top 4 players' avg

LT line growth rate trend

FY04 FY05 FY06

New contract sales growth for protection-type policies

32.0%

27.9% 29.3%

11.4%

13.9%

27.8%

Meritz Top 4 players' avg.

FY04 FY05 FY06

▶ Focusing on long-term line especially in protection-type which generatessuperior returns

Continuously strengthening long-term lines to improve portfolio profitabilitySustaining high growth in protection type policies

- Health, accident, drivers, property damage, etcProtection type profit margin is 4~5% while savings margin linger at 1% level

▶ Persistency ratio pick-up backed by real demand25th month persistency ratio improved to 62.7%, up from 60.9% in ‘05

2

13

Sales Network2MERITZ

▶ Strong and unique sales distributionImplementing unique sales network 1) TC: Total Consultant (Telemarketing + actual visits)

- Salespersons initiate outbound calls to targeted clients using acquired databases with follow-up face-to-face meetings with the prospects

2) Long-term line specialized agents- First mover in the industry- Contributing over 20% of newly written premiums in LT line

Strong presence in the bancassurance channel- Contracts with major banks and other financial institutions

38 commercial / mutual savings bank, securities companies- Channel market share of 13.6% as of March ‘07

[ Total Consultants ]

14.9%

-

Banc-assurance

100.0%

8,195 (100.0%)

Total

17.7%

2,475(30.1%)

General Solicitors

22.0%0.7%15.0%29.7%Premium

contribution

163(2.0%)

Specialized agencies

349(4.3%)

Generalagencies

1,884(23.0%)

TotalConsultants

3,324(40.6%)

Financial Consultants

# of people(%)

[Newly written premium contribution ] Long-term line only

14

Our ManagementMERITZ

▶ Outstanding management with expertise in non-life insurance

- CEO since June 2005

- Chief Operation Officer at PCA Life (Korea)

- Chief Information Officer at Samsung Fire & Marine

- 26 years of experience in US P&C insurers, such as General Accident, Harleysville

Insurance Group

CEO: Myung Soo Wohn, a/k/a Mike Wohn

Chairman: Jung Ho Cho

CFO: Jin Kyu Song

- Experienced management in both Securities and insurance business

- Chairman of Meritz Insurance since 2003

- Chairman & CEO of Meritz Securities (2003)

- Vice chairman & CEO of Hanjin Securities (1999)

- Swiss International Institute for Management Development (MBA)

- CFO of Meritz Insurance since May 2005, Head of strategic planning division

- Current member of Korean Actuarial Association

- More than 20 years in the non-life insurance industry

- Actuary and risk management manager of Samsung Fire & Marine (2005)

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15

1. Who we are

2. Investment Focus

3. FY06 Financial Results Summary

4. FY07 Strategies and Outlook

5. Frequently Asked Questions

※ Appendix : FY’06 Financials

ContentsMERITZ

16

FY’06 Summary

▶ Deployment of “profitability-focus strategy”

3MERITZ

Auto loss ratio to be stabilized around 72% level with per-vehicle rate increase

Maintaining the auto line market share at 7.1% level, which is same as last year

Sustaining high growth rate in the long-term line policies

Initial Forecast

Expansion of 5-day work week, removal of fake speed surveillance cameras on the road have slacked the awareness of safe-driving

Continuous increase in the frequency of accident rates have heighten the auto loss ratio

Fast and active measures taken to improve profitability amid hostile business environment

Focusing on long-term policies and recording double-digit growth

Market share: 8.3%(FY05) 8.6%(FY06)

Product mix:52.3%(FY05) 56.6% (FY06)

6.57.4

10.6

5.1

1st half 2nd half

MS

GR

Auto loss ratio & growth rate (%)

Recorded KRW 35.8B in net income (YoY 36.3%),

Adjusted ROE 13.7%In FY’06

vs.

Top 4 players’ avg. net income: 129.0B

(YoY 11.0%)Adjusted ROE 10.5%

ResultActions Taken

Actual Environment

17

Accomplishments of FY’06 (1)▶ Despite the high auto loss ratio and additional long-term IBNR reserving burden,

we have sustained high net income growth

MERITZ

Net Income Trend Adjusted ROE Trend

8.0B

76.6%

75.1%(-15.2B)

FY’05

15.8B

78.8%

78.5%( -31.5B)

FY’06

Industry (e)

Meritz(Total Loss)

4.6B△Long-term IBNR

72.8%

76.2%(-24.2B)

FY’04

Auto L/R

(KRW)

*Total loss are in terms of expected loss ratio

L/R (loss ratio), IBNR (Incurred but not reported reserve)

10.5%

12.0%

13.7%

11.0%

11.7%

12.9%

Meritz Top 4 players' avgerage

FY'04 FY'05 FY'06

21 2636

126116

129

FY04 FY05 FY06

36.3%

25.1%Meritz

Top 4 player’s averageMeritz’s YoY

(KRW Billion)

3

18

76.6%72.0%

70.6%

85.0%91.9%

89.4%

Accomplishments of FY’06 (2)▶ Sustaining both qualitative and quantitative growth in LT line

MERITZ

FY'04 FY'05 FY'06Total L/R Risk loss ratio (exclusive of IBNR)

Premium Mix

FY'04 FY'05 FY'06

15.8% 14.6% 12.6%

38.9%

45.2% 52.3% 56.6%

33.1% 30.8%

CommercialAutoLT

25.8%

21.2%

28.1%

32.0%

27.9%29.3%

FY'04 FY'05 FY'06

Total LT

New contracts for protection type

New Premium Growth for Protection-type Policies

62.7%

54.9%60.9%

75.8%73.9% 75.7%

FY'04 FY'05 FY'06

25th month

13th month

* 6th month valuation period

LT Loss Ratio LT Persistency Ratio

3

19

Accomplishments of FY’06 (3)MERITZ

▶ Leveling up bottom line strength via increase in investment assets

FY'04 FY'05 FY'06

2,260.32,554.6

3,000.4

17.4%

13.0%

Investment Asset

5.9%

5.1%

125.6(6.0%)

FY’04

5.3%

19.0%

149.5(6.4%)

FY’05

5.6%

6.5%

159.2(5.9%)

FY’06

YoY

Top 4’s Inv. Yield

Inv. Income (Inv. Yield)

(KRW Billion)

(KRW Billion)

3

20

0

50

100

150

200

250

300

350

400

450

500

04-03-31 04-09-30 05-03-31 05-09-30 06-03-31 06-09-30

Accomplishments of FY’06(4) : Boosting Shareholder Value MERITZ

07-03-31

Meritz:439.3

Insurance Sector: 242.9

KOSPI: 165.0

▶ Shareholder Return : Total Return is one of the top among peers

42.3%

2.8%

39.5%

FY05

26.2%

1.3%

24.9%

FY06

11.6%Total Return (A+B)

4.9%Dividend Yield (B)

6.7%

FY04

Capital Gain (A)

▶ Stock price: KRW 7,600(end of Mar. ’07, YoY 66.3%), Top among the big 5

Relative Price Trend (FY’04 ~ FY’06)

* Capital Gain: (Year end price – average price) / average price cf) average price: (last year end price + year-end price)/2* Dividend Yield: Dividend per share / average price

3

21MERITZ

Moody’s IFSR A3(stable) on 23, Nov. ‘06

- In line with A- of AM Best, Fitch, S&P’s

Acquired date : Nov. 27, ‘06

- Stakes: 13%

- Number of shares : 7,800,000

Accomplishments of FY’06 (5) : Others

▶ Share Acquisition of Meritz Investment Bank(Formerly known as Korean French Bank)

▶ Insurance Financial Strength Rating of A3 from Moody’s

3

22

1. Who we are

2. Investment Focus

3. FY06 Financial Results Summary

4. FY07 Strategies and Outlook

5. Frequently Asked Questions

※ Appendix : FY’06 Financials

ContentsMERITZ

23

FY’07 Business Targets4MERITZ

Continuously focusing on

transparency & Creating Customer

Value

Nurturing bestEmployees &

Pursuing dynamic

Corporate identity

Placing Efficiency & Profitability

First

Strategic Differentiation to

fully settle profit-oriented

corporate culture

Scientific & Systematic Corporate

management

24FY’07 Strategy Driven ManagementMERITZ

• Diversification of the sales channel• Boosting efficiencies of solicitors • Strengthening the expertise of the solicitors• Developing strategic sales channels

Maximizing sales channel strength

• Developing new market focused on SMEs• Be prepared for the needs of the aging society• Persisting focus on protection policies

Penetrating new P&C market

• Loss ratio stabilization via strict underwriting• Strengthening underwriting skills and tools

• Building Risk-Value management

Differentiating under-writing strategies

Strategic Differentiation to fully settle profit-oriented corporate culture

4

25

21.0

27.4

20.7

25.4

FY06

FY07

9.7

8.09.1

3.3

FY06

FY07

8.8

0.1

3.5

17.3

FY06

FY07

FY’07 Market OutlookMERITZ

Commercial Line Outlook

Industry Meritz

▶ Industry: Premium cut due to loss ratio stabilization and heightened competition in the market low growth (near zero)

▶ Meritz: Focusing on penetrating new markets such as SMM (Small Medium Market)

Auto Line Outlook Long-tern Line Outlook

▶ Industry: Hike in the premium level and growing number of registered vehicles, boost in sales of high-end vehicles will bring up the premium income per vehicles

expecting average growth

▶ Meritz: Marketing based on through profit study

▶ Industry: Boost interest in the aging agenda as well as individual health will heighten the needs in the A&H insurances high growth will be sustained

▶ Meritz: Restructuring the portfolio to bring up profitability & sustain the sales focus on protection-related policies

%

%

*Excluding one-time payment

Meritz MeritzIndustry Industry

4

26Financials Guideline for FY’07

24.4%3,747.84,662.3Total Assets

6.6%p13.7%20.3%Adjusted ROE

66.9%47.579.3Adjusted Income

17.1%11.713.7Inc. in Catastrophe Reserve

83.0%35.865.5Net Income

19.6%(-0.1%p)

159.2(5.9%)

190.3(5.8%)

Investment Income(Investment Yield)

Long-Term

Auto

Commercial

n.a.-116.0-99.0Underwriting Income

0.9%p24.3%25.2%Expense Ratio

-1.8%p84.9%83.1%

-4.7%p78.5%73.8%

-4.5%p53.0%48.5%

-2.5%p81.1%78.6%Loss Ratio

24.8% (0.3%p)1,234.9 (8.6%)1,541.3 (8.9%)Long-Term (M/S)

3.3% (-0.4%p)671.5 (7.0%)693.7 (6.6%)Auto (M/S)

17.3% (1.1%p)273.8 (8.5%)321.2 (9.6%)Commercial (M/S)

17.2% (0.2%p)2,180.2 (8.0%)2,556.2 (8.2%)Direct Premium (M/S)

YoYFY’06FY’07(KRW Billion)

MERITZ 4

27

Issues of FY’07 (1)

15.8

15.2%

FY’06

9.8

15.8%

FY’07 (e)

Inc. in IBNR

IBNR reserving %

(KRW Billion)

8.04.6

10%5%

FY’05FY’04

5.68.12.5Realized Equity gains

8.2

FY’06

0.9

FY’07 (e)

Negative goodwillamortization

(KRW Billion)

8.1

FY’05

1. Making up adequate level of long-term IBNR ending

MERITZ

78.5%

FY’06

73.8%

FY’07 (e)

Auto loss ratio 75.1%

FY’05

2. Expecting improvement of auto loss ratio

3. Equity method Gains

4

28

Sales-related cost should increase along with high growth in the long-term line portfolio due to up-front commissioning

MERITZ Issues of FY’07 (2)

0.9%p24.3%25.2%Expense Ratio

18.7%1,895.62,250.6Earned Premium

22.8%461.3566.5Net Expenses

18.3%49.158.1Expense Recovered

10.8%19.421.5Other Expenses

29.4%247.4320.1Sales-related

16.5%111.5129.9Administrative

15.8%132.1153.0Wage & Benefits

22.4%510.4624.5Expenses

YoYFY’06FY’07(KRW Billion)

Expense Ratio Rationale for FY’07

*Sales related expenses: acquisition cost/collecting fees, commission paid out to agencies, acquisition cost , amortization, deferred acquisition cost, etc.*Other expenses: loss adjustment expenses, co-insurance paid, reinsurance commission paid etc.

4

29FY’08 Business OutlookMERITZ

22.7%47.568.2%79.353.7%121.9Adjusted Net Income

YoYYoYYoY

6.6%p

81.9%

24.4%

17.2%

4.7%p

60.3%

37.8%

17.4%

25.0%

105.0

6,422.5

3,000.0

FY’08

1.7%p13.7%20.3%Adjusted ROE

35.5%35.865.5Net Income

20.5%3,747.84,662.3Total Assets

16.2%2,180.22,556.2Direct Premium

Written

FY’06FY’07(KRW Billion)

▶ Adjusted net income target of FY’07 KRW 79.3B FY’08 KRW 121.9B

4

30

1. Who we are

2. Investment Focus

3. FY06 Financial Results Summary

4. FY07 Strategies and Outlook

5. Frequently Asked Questions

※ Appendix : FY’06 Financials

ContentsMERITZ

31

15.76%15.24%10%5%-Reserving %

9.8B15.8B8.0B4.6B-Inc. amount

FY07FY06FY05FY04FY03IBNR

63.6 63.0 65.3 64.0 67.2

7.3 9.311.2

7.18.1

5.06.2

6.93.3

FY03 FY04 FY05 FY06 FY07

minor losses high(heavy) losses IBNR

69.866.766.946.8Total45.2FY06

66.146.4FY0566.867.746.4FY04

69.866.567.652.6FY03

4th Y3rd Y2nd Y1st YMinor loss

Accident L/R

MERITZ

Risk Loss Ratio

▶ Net income level will be sustained via expansion in the size of the premiums, although the loss ratio of each underwriting year is expected to rise

High loss accident L/R : Applied 4 years’ average loss L/R

(%)

70.9

77.3

82.7

78.0 78.6

Comp

2,953552323581883613FY07

100.018.710.919.729.920.8

100.019.510.216.829.723.8Comp

2,292447234385681545FY06

TotalAfter 5th Y4th Y3rd Y2nd Y1st YPremium

(KRW Billion)

Q1. Is L-T LR stabilization sustainable?

32

3.03

3.41

1.98

3.53.793.65

54.2%

86.6% 90.0%

0

1

2

3

4

FY04 FY05 FY060%

20%

40%

60%

80%

100%

Asset Duration Liability Duration Matching Ratio

Q2. Exposure to Interest Rate Risk?MERITZ

Duration Matching

▶ Matching Ratio of FY’06 is 90.0% which is a stabilized level in terms of hedging interest rate risk

Liability Cost & Spread

6.0

5.9

7.1

Investment Yield

6.53

6.87

7.27

Fixed rate

110bp4.924.18FY’06

80bp5.114.23FY’05

160bp5.514.17FY’04

SpreadLiability costFloating rate(%)

(Year)

33MERITZ

Risk segmentation by vehicle typesApr.07

Premium level adjustment6.6%↑Feb.07

Surplus/discount program introducedJan.07

Annual premium adjustment 2.5%↑Nov.06

Special surplus0.6%↑Oct.05

Annual premium adjustment3.6%↑Apr.05

Repair wage hike3.6%↑Nov.05

ReasoningIncreaseDate

(10.2%)(4.3%)Base

599

FY’06

574

FY’05

660

FY’07

Auto loss ratio

improved (-4.7% p)

KRW 30 billion

73.8%

FY’07

78.5%

FY’06

Income effect

Increase in premium

earned per vehicle

▶ As the accident rate lingers at historical highs, we focus on profitability for the accident rate stabilization is uncertain for some time

Focus on above-standard risks and reduce positions in sub-standard risks

- Aggressive underwriting differentiation of risks by geographic

segmentation, coverages selection and other underwriting guidelines and

controls

Q3. Auto LR Outlook & Strategies

*Effect is before income tax

Premium Increase (in KRW thousand)

34MERITZ

Directing capital& resources tocommercial line

Targeting Small-medium sized

markets

Improving re-insurance

scheme+ +

o Expanding and strengthening the capabilities of commercial line sales experts

o Adding new division and scouting experts in the industry

o Training programs to enhance expertise

o Different strategies for different market segments

o Providing tailor-made polices to different clients

o Improving back-operation staff

o Concentration towards SMM markets- Provide specialized policies

for target clients- Provide service packages

o Set-up infra regarding business-related risk consulting

o Nurture SMM consultants- FY07 target: 2,000 people

o Increase premium written via optimizing reinsurance scheme- Higher retention of high-

quality SME policies- Expanding surplus while

decreasing Q/S- Heighten the limit on the overseas reinsurance

o Strengthening risk management function

Strategically focusing on high-margin policies

Focus on Commercial Line

(Targeted share : 9.6%)

Q4. How Will We Expand in Commercial Line?

35MERITZ

Our EV Release PlanOur income driver is long-term line

How will LT line continuously enhance corporate value

in the future?

Embedded Valuewill tell us

○ Development since May ‘07○ Certified by independent

auditor○ Will begin announcement

with FY’07 earnings releases

Enhancing both shareholder and company value

Enhancing both shareholder and company value

Q5. Embedded Value Announcement?

36MERITZ

Financial Group

MeritzMeritzInsuranceInsurance ?

MeritzAsset

Management?

MeritzMeritzInvestmentInvestment

BankBank

MeritzMeritzSecuritiesSecurities

▶ Ultimate Target : To establish a one-stop full-lines financial service group

▶ Currently studying possible scenarios to optimize financial group plan.

We will announce all significant developments immediately

(Specialization, Diversification, Holding company structure are the possible

scenarios)

Q6. Roadmap of Financial Group

37

1. Who we are

2. Investment Focus

3. FY06 Financial Results Summary

4. FY07 Strategies and Outlook

5. Frequently Asked Questions

※ Appendix : FY’06 Financials

MERITZ

38

Appendix: FY’06 Premium Mix

One-time Payment -0.6%p-50.3%1.1%19.90.5%9.9

-16.2%100.0%1,876.9100.0%2,180.2Total

Recurring Premium

New Premium

4.8%p27.5%49.0%918.953.7%1,171.3

0.2%p26.3%2.3%42.52.5%53.7

5.0%p27.4%51.2%961.456.2%1,225.0Long-term

33.1%

14.6%

Comp

8.0%

0.1%

YoY

-2.3%p

-2.0%p

△Comp

622.030.8%671.5Auto

273.612.6%273.8Commercial

Comp

FY’05FY’06(KRW Billion)

▶ Market Share

New Premium 0.68.59.1

0.17.98.0Total

0.48.38.6Long-term

-0.17.17.0Auto

-0.89.38.5Commercial

YoYFY’05FY’06(%, %p)

MERITZ

*New premium does not include one-time lump sum payments

39

Appendix: FY’06 Loss Ratio

18.2%1,604.31,895.5Earned Premium

-4.5%p89.4%84.9%Loss Ratio

3.4%p75.1%78.5%Loss Ratio

3.9%p49.1%53.0%Loss Ratio

-0.8%p81.9%81.1%Loss Ratio

17.1%1,313.71,537.7Losses

Total

26.4%943.51,192.5Earned Premium

20.0%843.91,013.3Losses

Long Term

Auto

Commercial

(KRW Billion)

6.7%559.3596.7Earned Premium

11.6%419.9468.3Losses

4.8%101.5106.4Earned Premium

13.1%49.856.4Losses

YoYFY’05FY’06

MERITZ

40

Appendix: FY’06 Expense Ratio

Other Expenses

Sales-related

Administrative

Wage & Benefits

(KRW Billion)

22.0%1,592.81,943.1Net Premium Written

-5.5%52.349.1Expense Recovered

3.1%108.1111.5

-0.1%p24.4%24.3%Expense Ratio

18.2%1,604.31,895.6Net Premium Earned

18.0%391.0461.3Net Expenses

23.1%15.819.4

20.8%204.7247.4

14.8%114.7132.1

15.0%443.2510.4Expenses

YoYFY’05FY’06

MERITZ

*Sales related expenses: acquisition cost/collecting fees, commission paid out to agencies, acquisition cost ,

amortization, deferred acquisition cost, etc.

*Other expenses: loss adjustment expenses, co-insurance paid, reinsurance commission paid etc.

41Appendix: FY’06 LT Product Portfolio

-25.8%100.0%981.3100.0%1,234.9Total

-1.3%p16.9%18.1%177.816.8%207.8Savings

19.0%

41.3%

40.4%

1.4%

75.2%

13.4%

3.7%

14.6%

84.4%

29.8%

YoY

69.4%

30.6%

-

5.6%

2.1%

18.0%

16.1%

22.5%

17.6%

76.2%

Comp

65.6%

34.4%

-

4.5%

2.9%

16.2%

13.2%

20.5%

25.8%

78.6%

Comp △Comp

Bundle

Disease

Property

Drivers

Accident

-1.1%p55.256.0Personal Annuities

2.4%p748.1970.8Protection-Type

-2.8%p157.5163.4

(KRW Billion)

-3.8%p680.7810.1Savings Premium

-1.8%p176.7200.3

3.8%p300.6424.8Risk + Loading Premium

-0.30.4Corporate Pension

0.8%p20.235.4

-2.0%p220.9253.1

8.2%p172.8318.6

FY’05FY’06

*Including one-time payments

MERITZ

42

Appendix: FY’06 LT Coverage Portfolio

Accident

Drivers

Property Damage

Disease

Daily allowance

Medical treatment

--6.0%p100.076.6100.070.6Total

0.8%p11.4%p3.283.14.094.5

1.8%p

0.1%p

-2.7%p

-33.6%p

-11.9%p

-0.3%p

-6.5%p

-16.9%p

-10.3%p

-0.4%p

L/R

YoY

11.1

12.3

26.6

10.5

10.1

23.6

44.2

29.2

Comp

11.3

9.4

24.7

10.4

11.2

26.5

48.2

27.2

Comp △CompL/RL/R

-2.9%p89.155.5

-2.0%p40.940.5Death Coverage

1.1%p101.795.2

Others

(%)

60.9%62.7%25th month

-0.1%p88.888.5

75.7%75.8%13th moth

0.2%p38.040.7

-1.9%p67.055.1

2.9%p115.498.5

4.0%p105.995.6Life Benefit

FY’05FY’06

[Persistency Ratio]

MERITZ

*Valuation period: 6 month

43

Appendix: FY’06 Asset Portfolio

6.4%

2,554.6

370.0

400.6

37.2

93.3

53.7

219.0

971.5

58.4

59.4

0

59.4

291.6

FY’05

Available for sale

Trading

-

-

-2.0%p

0.6%p

-0.8%p

5.3%p

1.0%p

0.8%p

-2.5%p

0.4%p

-0.9%p

-

-0.9%p

-2.0%p

△Comp

-0.5%p--5.9%Investment Yield

17.4%100.0%100.0%3,000.4Investment Assets

1.5%14.5%12.5%375.7Real Estates

22.1%15.7%16.3%489.0Loans

Overseas Securities

Structured Securities

Beneficiary Certificates

Equity method stocks

-44.1%1.5%0.7%20.8Others

188.5%3.7%9.0%269.1

75.7%

28.3%

9.6%

36.2%

-28.9%

-

-28.4%

-2.9%

YoY

3.1%

9.4%

35.5%

2.7%

1.4%

-

1.4%

9.4%

Comp Comp

8.6%281.1

11.4%283.1Cash & Equivalent

2.3%42.2

Domestic Bonds

(KRW Billion)

2.3%79.7

2.1%94.3

38.0%1,065.2

-0.3

2.3%42.5Equities

FY’06

MERITZ

44

Appendix: FY’06 Loan Portfolio

Collaterized loan

Credit loan

Policyholder equity loan

Collaterized loan

Credit loan

406.2

149.0

10.6

159.5

149.3

94.8

2.5

246.7

FY’05

Total loan

Corporate

49.6%222.9

6.9%263.6Retail

23.3%184.1

(KRW Billion)

45.7%232.5

22.1%496.1

-9.0%9.6

-18.7%77.1

-5.0%2.4

YoYFY’06

Loan Breakdown

MERITZ

FY’06

FY’05

Credit retail0.5%

Collaterizedretail15.5%

Policyholderloan

37.1%Creditcorporate

1.9%

Collaterizedcorporate

44.9%

Credit retail0.6%

Collaterizedretail23.3%

Policyholderloan

36.8%

Creditcorporate

2.6%

Collaterizedcorporate

36.7%

45

Appendix: FY’06 Profit & Loss SummaryMERITZ

Net Income

Non-operating Income

Investment Income

Inc. in Catastrophe Reserve

Underwriting Income

Inc. in Premium Reserve for LT-savings type products

Net Operating Expenses

35.5%26.435.8

35.0%6.38.4Incurred Tax Expenses

36.4%32.744.2Ordinary Income

n.a.-2.71.0

6.5%149.5159.2

n.a.-114.1-116.0

Net inc. in Policyholder’s dividend Reserve

-4.7%12.311.7

-3.0%8.07.7

32.6%351.7466.3

18.0%391.0461.3

Net Premium Written

Direct Premium Written

18.1%571.9675.6Incurred Losses

1.4%383.5388.8Refund of LT Insurance Polices

22.0%1,592.81,943.1

16.2%1,876.92,180.2

18.2%1,604.31,895.6Net Premium Earned

YoYFY’05FY’06(KRW Billion)

46

Appendix: FY’06 Balance Sheet SummaryMERITZ

20.9%207.2250.5Solvency Guideline amount

6.7%400.2426.9Solvency Amount

-22.7%p193.1%170.4%Solvency Margin Ratio

n.a.-1.6-0.6Capital Adjustment

17.4%160.9188.9Retained Earnings

2.8%28.229.0Capital Surplus

Capital Stock

Total Shareholder’s Equity

Other Liabilities

Catastrophe Reserve

Policy Reserve

-42.942.9

12.9%230.4260.0

13.5%311.4353.5

9.2%120.7132.5

Non-invested Asset

Investment Asset

21.1%2,879.73,487.7Total Liabilities

22.5%2,447.53,001.7

34.6%555.4747.4

17.4%2,554.63,000.4

20.5%3,110.03,747.8Total Asset

YoYFY’05FY’06(KRW Billion)