Poland: CU Life Fund performance - 2006 excellent for equity and mixed funds

In spite of the fairly cautious forecasts for 2006, the 12 months just past proved to be among the best periods for Warsaw Stock Exchange investors. The fifth consecutive year of equities market growth translated into especially high profits for those CU Life clients who chose equity and mixed funds as part of their individual and group insurance and employee pension programmes (PPEs).

Commercial Union Poland Life Insurance Company offers over a dozen capital funds linked to individual and group insurance programmes and PPEs. The funds represent a wide range of investment strategies.

"Last year was one of the five best years in the 16-year history of the Warsaw Stock Exchange. This favourable equity market trend resulted chiefly from record inflows into unit trusts, especially equity and mixed funds, as well as from the excellent performance of Polish companies and the economy as a whole. The generally favourable climate on international equity markets, and especially on the 'emerging' markets among which Poland continues to be included was also of considerable importance," says Rafał Janczyk, investment director of CU Investment Management, the company managing assets of CU Life funds.

A feature of 2006 on the Warsaw exchange was the unusually large rise of the share prices of small and medium size enterprises (the Midwig index rose by 69%, while the WIRR rose by 132%) by comparison with the blue chips (the WIG20 rose by 24%).

In 2006, CU Life equity-oriented funds produced rates of return of 36-37%, while the price of units in the Balanced Fund rose by approximately 19%. The international fund did slightly less well, due to the significant strengthening of the value of the Polish zloty against the US dollar.

"Reviewing the results achieved during the past five years, it is worth noting the record increase of nearly 350% in the value of Dynamic Fund units. During the same period, two other funds achieved equally impressive three-figure rates of return: the CU Equity Fund and the Balanced Fund," stresses Rafał Janczyk.

CU is among the few Polish life insurers which can boast a ten-year investment history for its capital fund. This is its guaranteed fund, which in spite of its very safe investment profile, increased its unit value by 175% during the past 10 years, as compared with the inflation rate of 66% for the same period.

The assets of the CU Life capital insurance funds are managed by the specialist company Commercial Union Investment Management (Poland) SA. It holds a licence from the Polish regulator to manage securities portfolios and offer investment advice. It is third among Poland’s asset management companies in terms of the value of assets under management (a total of 13.6 billon PLN at the end of the fourth quarter of 2006).

Rates of return on Commercial Union Poland Life Insurance Company capital insurance funds as at the end of IVQ 2006 (%)

-ends-

Information:
Bohdan Bialorucki
Telephone: +48 22 557 43 41
E-mail: bohdan_bialorucki@cu.com.pl
For further information, see www.cu.pl

Notes to editors:
Commercial Union Poland group is part of the international Aviva group, the world’s fifth-largest insurance organisation and the largest in the United Kingdom by revenue. Aviva group operates in 25 countries. It occupies a strong position in the European Union, including the United Kingdom, Ireland, France, the Netherlands, Spain, Italy and Poland. It also has a large presence in the USA, Canada, Australia and Asia. Worldwide, Aviva Group serves approximately 35 million clients and manages assets valued at over Ł330 billion. Additional information: www.aviva.com