CGNU and DBS Partnership

CGNU PLC
23 July 2001



CGNU AND DBS BANCASSURANCE PARTNERSHIP IN SINGAPORE

CGNU plc (CGNU) announces today that it has entered into a bancassurance 
partnership with DBS Group Holdings Ltd (DBS), the largest bank in 
South East Asia.  As part of this transaction CGNU will acquire 100 per cent 
of The Insurance Corporation of Singapore (ICS), DBS's life and general 
insurance subsidiary.

The bancassurance partnership is for ten years and will give CGNU exclusive 
access to DBS's Singapore customer base of approximately four million 
customers for the distribution of life and general insurance products.  DBS 
has the highest penetration in the retail banking sector in Singapore with 
over 90% of Singaporeans and permanent residents among its customer base. It 
also has the largest network of branches.

The transaction marks CGNU's entry into the growing Singapore long-term 
savings market.  In 2000, total market new business single premiums grew 87% 
to S$3.3 billion (£1.3 billion) and regular premiums by 28% to S$667 million
(£257 million), as published on a local market basis.  CGNU will also improve 
its general insurance market position in Singapore from fifth to the market 
leader.  The transaction is in line with CGNU's strategy of growing its 
long-term savings business, having a focused approach to general insurance 
and building top five positions in its chosen markets.

The products will be distributed through DBS branches, ATMs, direct marketing 
and telesales channels.  A specialist financial adviser sales force will also 
be built as part of the bancassurance partnership for the distribution of 
life products.

CGNU will generate estimated annualised cost savings of approximately 30% of 
current ICS costs by merging the ICS general insurance business with its 
existing operations.

Under the agreements announced today, the consideration for the acquisition 
of ICS is S$324 million (£125 million). In addition, CGNU will pay 
S$71 million (£27 million) to DBS in respect of the bancassurance 
partnership, with further potential amounts payable over the term of the 
agreement if DBS meets certain performance criteria. The total consideration 
of S$395 million (£152 million) is payable in cash. DBS will also receive a 
dividend of S$51 million (£20 million) from ICS prior to completion.

The acquisition of ICS has received approval in principle from the regulators 
and completion is expected within the next month.

Philip Twyman, group executive director of CGNU said:
'This transaction will serve as our springboard into the long-term savings 
market of South East Asia.  It marks our entry into this growing market in 
Singapore and DBS is a strong partner with an excellent distribution network. 

It gives us the opportunity to leverage our European bancassurance experience 
into new markets and to achieve consolidation benefits in our existing 
Singapore general insurance business.'

Jackson Tai, president and chief operating officer of DBS said: 
'This partnership is a big win for DBS and for CGNU as we will become the 
leading bancassurer in Asia.  But the real winners will be our customers, who 
will have access to the leading bancassurance products in the world and to an 
integrated suite of wealth management products.'

Contact details :

Analysts/Investors
Steve Riley, Investor Relations Director          [phone]

Press
Hayley Stimpson, Director of External Affairs     [phone]
Stuart Blackmore, Financial Dynamics              [phone]


NOTES TO EDITORS :

Exchange rate: £1 = S$2.60

CGNU
CGNU plc is the world's sixth-largest insurance group, the largest insurer in 
the UK and one of the top five life companies in Europe. Its main activities 
are long-term savings, fund management and general insurance. It has worldwide
premium and investment sales of £27 billion from ongoing businesses and more 
than £210 billion in assets under management at 31 March 2001. The Group has
70,000 employees and more than 15 million customers.  

Website address is www.cgnu-group.com

CGNU in Asia
CGNU has a long-established presence in Asia with top five market positions 
in general insurance in Singapore, Hong Kong, Malaysia, and Thailand and a 
joint venture life operation in Thailand (established 1998).  In addition 
CGNU has general insurance operations in Brunei, Indonesia, Macau, Marianas, 
Philippines and Taiwan. CGNU also has representative offices in China and 
India.

Pro forma premium income for year 2000 is as follows:

                                                                (in £m)
                                       Life          General             
                                    Insurance       Insurance
       Company                    Gross Premium   Gross Premium             
                                     Written         Written           

       CGNU Asia (before                  1            182           
       acquisition)
       ICS                              152             40           
       CGNU Asia (after                 153            222           
       acquisition)

DBS
DBS Group Holdings is the holding company for the largest banking group in 
South East Asia. It is the dominant bank in Singapore and the fourth largest 
in Hong Kong.  It is a recognised leader in internet banking and e-commerce
and the market leader in Singapore-dollar loans and deposits.

Beyond Singapore, the DBS Group serves corporate, institutional and retail 
customers through subsidiaries in Hong Kong, The Philippines, Indonesia and 
Thailand, and international banking services through a network of overseas 
branches and offices.

Website address is www.dbs.com

ICS
Established in 1969, ICS offers a comprehensive range of life, health and 
general insurance products to meet the needs of corporate as well as 
individual customers.  Since then, ICS has grown to become Singapore's largest
group life and health insurer, and a leading general insurer, with a staff of 
400.

In January 2000, ICS became a wholly owned subsidiary of DBS Group Holdings 
through a scheme of arrangement to privatise the company.

Agents, brokers, bancassurance and the internet form integral parts of the 
distribution channels for its products and services.

In 2000 new business single premiums and new business regular premiums 
reported on a CGNU basis were S$315 million (£121 million) and S$7 million 
(£3 million) respectively.

Website address is www.icsinsurance.com.sg

Singapore insurance market
Singapore has a population of over four million enjoys the highest standard of
living among ASEAN countries and provides a favourable environment for foreign
and domestic businesses.

It has a strong regulatory framework and a strong savings ethic. The average 
per capita income is £16,000. The life market in Singapore is the most 
developed in South East Asia and offers attractive growth opportunities. The
option of investing Central Provident Fund (CPF) funds, the local mandatory 
pension scheme, in life assurance products accounts for the substantial bias 
towards single premiums.

The further liberalisation of the CPF regulations has created further 
investment in life products, which are an approved investment vehicle.