Clarification on media report of Commercial Times (page2) dated Aug 7, 2007

2007-08-07

1.Name of the reporting media:Commercial Times(page2) 2.Date of the report:2007/08/07 3.Content of the report:The CDO investment impact to Taiwan financial institutions. 4.Summary of the information provided by investors:None 5.Company's explanation of the reportage or provided information:Recently the media has run various pieces of news regarding to the impact of US sub-prime mortgage investment on Taiwan insurance industry, particularly focusing on the estimation of potential loss. Cathay Life is not directly exposed to the US sub-prime mortgage market. Of total investment portfolio in Cathay Life, only NT$1.8BN is indirectly linked to the US sub-prime mortgage market. So far, Cathay Life does not suffer any loss on principle. Furthermore, interest collections remain normal. 6.Countermeasures:None 7.Any other matters that need to be specified:None