CNP Assurances : First-half 2008 Results

Further Growth in Technical Reserves

PARIS, August 27 /PRNewswire-FirstCall/ -- CNP Assurances, France's
leading personal insurer with operations in Europe and in South America, has
announced its first-half 2008 results which confirm its robust fundamentals.
Highlights

- Reported net profit rose 1.1% despite the effects of the financial
crisis.

- Attributable recurring profit totalled EUR756 million, up 9.1%
excluding the effects of falling stock markets.

- Average insurance and financial liabilities rose by a strong 6.3% and
continued to represent the main driver of earnings growth.

- Robust growth in personal risk and pensions business only partly offset
lower savings revenue. Gross new money was down 16.8% on first-half
2007 but net new money remained positive.

- Solvency capital at 30 June 2008 represented 1.85 times the regulatory
minimum in total and 1.20 times excluding unrealised gains (based on
Solvency I)

- Embedded value at 30 June 2008 stood at an estimated EUR75.1 per share,
up 0.2% on 31 December 2007. In-force business amounted to EUR16.7 per
share and adjusted net assets came to EUR58.4 per share.

Gilles Benoist, Chief Executive Officer, said:
"Our first-half results attest to CNP's resilience in a turbulent market.
Reported profit for the period was up 1.1% over first-half 2007. Our
international subsidiaries contributed a substantial 24% of EBIT. Our
solvency ratios provide evidence of our very robust financial position,
particularly as our ABS portfolio has virtually no exposure to the market
segments that are currently in crisis."
I. Revenue
As announced in the 1 August press release, premium income under French
GAAP for first-half 2008 totalled EUR14,750 million, down 16.8% on the
year-earlier period. Premium income under IFRS came to EUR14,063 million. The
strong momentum enjoyed by the pensions and personal risk businesses and
growth in Brazil only partly offset the sharp drop in savings revenue in
France and Italy. Net new money nevertheless remained positive, representing
EUR3.5 billion for the French savings and pensions business alone.
II. Results
To offset the effects of the first-half 2008 financial crisis
(particularly the sinking stock markets), certain technical reserves were
reduced and additions to other reserves were scaled back compared with
first-half 2007. Fair value adjustments to the trading portfolio trimmed
EUR182 million from first-half 2008 profit, after adding EUR162 million in
the year-earlier period. At the same time, falling stock market prices led to
the recognition of EUR91 million in impairment losses on equities.
Non-recurring reversals for the period totalled EUR307 million versus
additions of EUR194 million in first-half 2007.
In the following discussion, period-on-period changes are presented on a
reported basis and also after restating these adjustments, in order to
highlight the Group's underlying performance.
EBIT totalled EUR1,264 million on a reported basis and EUR956 million
excluding the effects of managing the stock market crisis (up 6.9%). The
savings business contributed EUR536 million to this latter amount (up 1.0%),
pensions business EUR83 million (up 13.7%) and personal risk business (health
insurance, personal risk, loan insurance and property & casualty insurance)
EUR302 million (up 12.3%).
For pensions, the increase was largely attributable to Caixa Seguros
(Brazil) and, for personal risk, to growth in loan insurance business across
the Group.
The international subsidiaries continued to make a significant
contribution, accounting for 24% of total EBIT. Caixa Seguros's contribution
rose by a strong 15.6% compared with first-half 2007.
Attributable recurring profit (including net capital gains on equities
and investment property) amounted to EUR756 million on a reported basis and
EUR633 million excluding the effects of managing the stock market crisis (up
9.1%).
As announced on 1 August, reported attributable profit rose 1.1% to
EUR574 million.
Average insurance and financial liabilities were up 6.3% on first-half
2007. At 30 June 2008, they totalled EUR240.1 billion excluding deferred
participation.
III. Embedded value
CNP Assurances publishes its embedded value according to the principles
recommended by the CFO Forum, of which it is a member. At 30 June 2008,
European embedded value (EEV) was estimated at EUR75.1 per share (before
dividends and after the cost of solvency capital and non-financial risks), an
increase of 0.2% over 31 December 2007. ANAV came to EUR58.4 per share before
dividends. In-force business amounted to EUR16.7 per share. This represented
a decline of EUR2.4 from the 31 December 2007 level, which was mainly due to
the effects of changing economic conditions (EUR2.35) led by lower stock
market prices and increased volatility.
The value of new business came to an estimated EUR147 million or EUR1.0
per share, down 28% from 30 June 2007. The decline was mainly attributable to
the fall-off in business. New business margin stood at 10.7% in first-half
2008 versus 11.5% for the 2007 financial year, reflecting changes in product
mix in France and Italy, particularly the decline in unit-linked sales caused
by falling stock market prices.
IV. Solvency capital
As announced in the 1 August press release, the post-dividend solvency
capital requirement under Solvency I was covered 1.85 times at 30 June 2008,
including 1.20 times by equity and quasi-equity.
V. Targets and outlook for 2008
The Group's 2008 recurring profit target is maintained. CNP confirms that
unless the financial crisis worsens considerably, it expects to report
double-digit growth in attributable recurring profit for 2008, despite the
unfavourable trading conditions in France.
This financial press release, the interim consolidated financial
statements and the interim narrative report(1) in French and English can be
downloaded from the CNP Assurances web site, http://www.cnp-finances.fr.
____________________________
(1) Currently undergoing a limited review by the Statutory Auditors.

Glossary
Embedded value (EV)
Adjusted NAV + value of in-force business. Starting in 2006, CNP
Assurances calculates embedded value in accordance with CFO Forum principles
(European embedded value).
In-force business
Discounted present value of the future earnings stream from in-force
business less the cost of the capital needed to comply with solvency margin
requirements.
New business (value of)
Discounted present value of future earnings streams from business written
during the year less the cost of the capital needed to comply with solvency
margin requirements.
First-Half Premium Income

IFRS French GAAP
Premium income H1 2008 H1 2007 % change H1 2008 % change
(EURm)
Savings 10,445.1 14,153.9 - 26.2 11,131.6 - 22.7
Pensions 1,176.4 968.3 + 21.5 1,176.8 + 10.1
Personal risk 818.2 782.0 + 4.6 818.2 + 4.6
Loan insurance 1,274.4 1,162.1 + 9.7 1,274.4 + 9.7
Health insurance 170.1 160.8 + 5.8 170.1 + 5.8
Property & Casualty 179.3 170.4 + 5.2 179.3 + 5.2

TOTAL 14,063.5 17,397.5 - 19.2 14,750.3 - 16.8

Premium income in Spain includes CNP Vida only since the second quarter
of 2007.

IFRS French GAAP
EURm H1 2008 % change H1 2008 % change
France 12,319.3 -17.7 12,325.1 -18.3
Italy(1) 761.9 -55.8 1,296.7 -28.7
Brazil 765.2 +39.0 900.4 +33.4
Spain(2) 95.2 +120.8 95.2 +120.8
Other 121.9 - 133.0 -
TOTAL 14,063.5 -19.2 14,750.3 -16.8
(1) Italian branches, Cofidis business in Italy and CNP Vita.
(2) Spanish branches, Cofidis Spain and, since 5 April 2007, CNP Vida.

Income Statement

IFRS (in EURm) Reported Restated(2)
H1 2008 H1 2007 Reported H1 2008 H1 2007 Restated
change change

EBIT(1) 1,264 700 +80.5% 956 895 +6.9%
- Finance costs and (38) (29) - (38) (29) -
share of profit of
associates
- Income tax expense (366) (193) - (273) (251) -
- Minority interests (74) (86) - (74) (86) -
Attributable recurring 785 392 +100.1% 571 529 +8.0%
profit before capital
gains
Net realised gains on (29)(3) 14 - 62 51 -
equities and investment
property
Attributable recurring 756 406 +86.1% 633 580 +9.1%
profit after capital
gains
Fair value adjustments (182) 162 - -
to trading securities
Profit attributable to 574 568 +1.1% 633 580 +9.2%
equity holders of the
parent

(1) EBIT corresponds to net insurance revenue less expenses, i.e.
operating profit before fair value adjustments, capital gains on equities and
investment property held in proprietary portfolios and non-recurring items.
(2) Restated for non-recurring adjustments to technical reserves as
follows: EUR307 million in non-recurring reversals included in EBIT in
first-half 2008 and EUR194 million in non-recurring additions deducted from
EBIT in first-half 2007 (3) Net of EUR91 million in impairment losses

Embedded Value

In EUR per share 30/06/2008 31/12/2007 % change

ANAV before dividends 58.4 58.7 - 0.5%
(before dividends)

55.8 + 4.7%
(after dividends)

European embedded value (EEV)
per share before dividends,
cost of share before dividends,
cost of solvency margin and
non-financial risks 75.1 77.8 - 3.5%
(before dividends)

74.9 + 0.2%
(after dividends)

Embedded value per share at 30 June 2008 was calculated on the basis of
148,537,823 shares.

Financial Calendar

Third-quarter 2008 report 6 November 2008

Disclaimer Some of the statements contained in this press release may be
forward-looking statements referring to projections, future events, trends or
objectives which, by their very nature, involve inherent risks and
uncertainties. Actual results could differ materially from those currently
anticipated in such statements by reason of factors such as changes in
general economic conditions and conditions in the financial markets, legal or
regulatory decisions or changes, changes in the frequency and amount of
insured claims, particularly as a result of changes in mortality and
morbidity rates, changes in surrender rates, interest rates, foreign exchange
rates, the competitive environment, the policies of foreign central banks or
governments, legal proceedings, the effects of acquisitions and the
integration of newly-acquired businesses, and general factors affecting
competition.
Further information regarding factors which may cause results to differ
materially from those projected in forward looking statements is included in
CNP Assurances' filings with the Autorite des Marches Financiers. CNP
Assurances does not undertake to update any forward-looking statements
presented herein to take into account any new information, future event or
other factors.
SOURCE CNP Assurances

Press Relations: Sophie Messager, Tel: +33(0)1-42-18-86-51, E-mail:
servicepresse@cnp.fr; Investor and Analyst Relations: Brigitte Molkhou, Tel:
+33(0)1-42-18-77-27; Jean-Yves Icole, Tel: +33(0)1-42-18-94-93, E-mail:
infofi@cnp.fr