21 July 1998

Press Release

Munich Re and ERGO plan joint asset management company

Munich Re and ERGO Versicherungsgruppe intend to set up a joint asset management company. The new company will manage investments with a market value of well over DM 200bn and will thus be one of the biggest asset management companies in Germany.

The profitability of investments is assuming increasing importance in the insurance industry. The idea behind "MEAG MUNICH ERGO ASSET Management GmbH" - the provisional working title for the company - is to further enhance the profitability of the insurers and reinsurers investments and enable them to take advantage of the potential for synergies in their investment operations. With this move, the companies are preparing for the introduction of the euro, the single currency market and the related capital market expansion. They are doing so by combining the know-how of the world's leading reinsurer in international investments with the competence acquired over many years in this field by Victoria, Hamburg-Mannheimer, DKV and D.A.S. This will further improve the competitive positions of the companies involved.

The plan is for MEAG to have its registered seat in Munich. It is envisaged that the management of the company will be assigned to ERGO Versicherungsgruppe AG, as the bulk of the investments will be from the ERGO Group.

The requisite detailed plans are now being drawn up in consultation with the relevant bodies.