(25/08/2005) Fortis first half 2005 net profit before results on divestments up 34% to EUR 2.1 billion

Brussels / Utrecht, 25 August 2005 Continued strong performance of banking and insurance in the second quarter First half 2005 net profit before results on divestments: Total net profit before results on divestments up 34% from EUR 1,571 million to EUR 2,100 million; up 33% per share to EUR 1.64 Banking net profit before results on divestments up 37%, from EUR 1,082 million to EUR 1,482 million - Total revenues up 9% - Costs remained flat - Lower impairments on loans Insurance net profit before results on divestments up 21% from EUR 564 million to EUR 684 million - Total gross inflow Life +34% to EUR 5,359 million - Gross written premiums Non-life (excluding Assurant) up 2% to EUR 2,688 million - Non-life combined ratio improved substantially, from 98% to 94% First half 2005 net profit up 18% to EUR 2,543 million compared with the very strong first half of 2004; earnings per share up 17% to EUR 1.98 Second quarter net profit before results on divestments amounted to EUR 1,056 million, up 1% compared to the exceptionally strong first quarter Interim dividend per share amounts to EUR 0.52 in cash

Key figures Fortis (in EUR million)	H1 2005	H1 2004	Change
		Pro-forma (1)
Net profit before results on divestments	2,1	1,571	34%
Banking	1,482	1,082	37%
Insurance	684	564	21%
General	(66)	(75)	(13%)
Results on divestments	443	585	-24%
Assurant (General)	443	422	5%
Seguros Bilbao (Insurance)		145	*
Fortis Bank Asia (Banking)		18	*
Net profit	2,543	2,156	18%
EPS (in EUR)	1.98	1.69	17%
Before results on divestments	1.64	1.23	33%
Net equity per share (in EUR)	14.31	12.05 2)	19%
Return on equity (in %)	21.4 3)	21.5 4)

1) Fortis is publishing its first half 2004 and 2005 results under the new International Financial Reporting Standards (IFRS). Under IFRS, hedge accounting may not be applied retroactively to the 2004 accounts. However, to facilitate comparison, Fortis has published pro-forma net profit for 2004 taking the existing hedging strategies into account. The analysis in this press release refers to movements in the results versus the pro-forma results for first half of 2004, which include hedge accounting. 2) Year-end. 3) Rolling average of the latest four quarters. 4) Full-year 2004. CEO Jean-Paul Votron comments: "With net profit before results on divestments up 34% to EUR 2.1 billion in the first half of this year, it is clear that Fortis is determined to achieve the ambitious targets set out in its strategic plan. At EUR 1.1 billion, net profit before results on divestments in the second quarter of this year is even slightly up on the very strong first quarter results. This was due to a sound commercial performance, which was underpinned by sustained benign market conditions. More volatile elements, such as trading and capital gains, also contributed to these solid results. We have continued to pursue sound cost management, and the number of FTEs has remained stable. Operating expenses remained flat, as investments in client-facing staff and the distribution network were offset by lower other expenses. We are on track to deliver the ambitious cost savings of EUR 100 million in support functions by mid-2006. At the same time, we will continue to make investments to improve our services so we can achieve our goal of getting closer to our customers and being stronger in Europe. To pursue our growth strategy, we need the right people in the right place. As part of Fortis's new performance culture, we are developing targeted initiatives at management and senior management level, including leadership training and a more rigorous performance evaluation process. In the first six months of 2005, we made great strides in achieving our goal of generating 30% of net profit outside the Benelux countries by 2009. We acquired Di bank in Turkey and our bancassurance activities in Portugal took off. The recently announced acquisition of Dryden will strengthen our footprint in private banking in the United Kingdom, Asia and other important markets, adding EUR 9 billion in funds under management. The accelerated rollout of our international Commercial & Private Banking network continued with the opening of three new business centres in three new countries in the second quarter, and we are also further investing in our global niche activities, such as Shipping and Commodities. In Banking, higher revenues, lower impairments on loans and flat costs resulted in a 37% increase in net profit before results on divestments to EUR 1.5 billion and a decline in the cost/income ratio to 56%. Trading results, which are traditionally high in the first half of the year, were very good. Important trends seen in the first quarter continued in the second, e.g. the credit environment is still benign. The low interest rate environment remains very challenging, though. We responded to lower interest rates and the flattening yield curve by adjusting the pricing on deposits, thereby protecting our margins. In Belgium, mortgage and life insurance sales were record high, and the Netherlands saw a further increase in the sale of insurance policies through the banking channel. These are excellent examples of the success of our bancassurance model. In Insurance, net profit before results on divestments went up 21% to EUR 0.7 billion, driven by better technical results. Our Non-life business in particular benefited from very favourable operating conditions. In both Life and Non-life insurance our aim is to offer innovative solutions to our customers while protecting the underlying margins. In this respect, we have lowered the guaranteed rate on single-premium individual Life insurance in Belgium to 2.5%. Efficient use of capital is key to our strategy. We will therefore pay an interim dividend of EUR 0.52, which is 50% of the previous full-year dividend. This means that by mid-September we will have returned more than EUR 2 billion to shareholders in four months' time. As stated before, our retained earnings will allow us to carry out our organic growth plans while our solvency enables us to consider value-creating add-on acquisitions." Dividend In accordance with Fortis's new dividend policy, the Board of Directors has decided to pay an interim dividend of EUR 0.52. The interim dividend will be paid in cash on 15 September 2005. On 26 August, Fortis shares will be quoted ex-interim dividend. 1. Fortis 1.1. First half 2005 compared with first half 2004 Total net profit before results on divestments went up 34% to EUR 2,100 million, due to strong improvements in results at Banking, Insurance and General. Net profit increased by 18% to EUR 2,543 million compared with the very strong first half of 2004. At Banking, net profit before results on divestments increased sharply from EUR 1,082 million to EUR 1,482 million (+37%). Total revenues went up by 9% to EUR 4,589 million, while total expenses remained stable at EUR 2,568 million. The change in provisions for impairment on loans was lower at EUR 37 million (-66%). At Insurance, net profit before results on divestments increased by 21% to EUR 684 million, driven by better technical results. Non-life further improved its very strong performance of previous quarters, while the Life result rose sharply in the second quarter. Costs remained tightly controlled. The combined ratio improved from 98% to 94%. At General, net profit before results on divestments amounted to a loss of EUR 66 million (2004: a loss of EUR 75 million). Net profit increased by 9% to EUR 377 million. This was affected both in 2004 and in 2005 by the transactions with respect to Assurant, which amounted to EUR 443 million in the first quarter of 2005 versus EUR 422 million in the first quarter of last year. 1.2. Second quarter 2005 compared with first quarter 2005 Total net profit before results on divestments amounted to EUR 1,056 million, up 1% compared with the exceptionally strong first quarter. At Banking, net profit before results on divestments decreased by 9% to EUR 706 million, mainly due to lower capital gains on the bond portfolio. At Insurance, net profit before results on divestments rose by 24% to EUR 379 million. Total net profit ended 29% lower, due entirely to the impact of the transactions with respect to Assurant in the first quarter (EUR 443 million).

Key figures Fortis (in EUR million)	Q2 2005	Q1 2005	Change
Net profit before results on divestments	1,056	1,044	1%
Banking	706	776	(9%)
Insurance	379	305	24%
General	(29)	(37)	(23%)
Divestments		443
Assurant (General)		443
Net profit	1,056	1,487	(29%)
EPS (in EUR)	0.82	1.16	(29%)
Before results on divestments	0.83	0.81	2%
Net equity per share (in EUR)	14.31	13.33	7%

1.3. Solvency

in EUR billion	30 June 2005	31 December 2004
Net core capital	21.6	20.2
Legally required minimum	11.3	10.3
Surplus above legally required minimum	10.3	9.9
Surplus above legally required minimum (as %)	90	96
Fortis's floor	17.9	16.4
Surplus above Fortis's floor	3.7	3.8
Surplus above Fortis's floor (as %)	20	23

Net core capital is calculated conservatively. It excludes any unrealised capital gains on the bond portfolio, goodwill, and any elements of embedded value. At 30 June 2005, net core capital was EUR 21.6 billion, which was EUR 10.3 billion (90%) above the legally required minimum and EUR 3.7 billion (20%) above Fortis's own floor. The Tier 1 ratio and total capital ratio remained high, at 7.4% and 11.0%, respectively. The acquisition of Di bank and the payment of the interim dividend would reduce the surplus above the Fortis floor to 12%. 2. Banking

Key figures ? Banking (in EUR million)	H1 2005	H1 2004	Change	Q2 2005	Q1 2005	Change
		Pro-forma
Total revenues	4,589	4,191	9%	2,192	2,397	(9%)
Total expenses	2,568	2,562	0%	1,283	1,285	(0%)
Profit before income tax	1,984	1,518	31%	897	1,087	(17%)
Net profit before results on divestments	1,482	1,082	37%	706	776	(9%)
Divestments (Fortis Bank Asia)		18
Net profit	1,482	1,1	35%	706	776	(9%)
Cost / Income Ratio	56.0%	61.1%		58.5%	53.6%
Operating leverage	9.3%
- Credit Loss Ratio (basis points) 1)	4	12		3	5
- Tier 1 ratio	7.4%	8.3% 2)
FTEs	35,997	35,805 2)	1%	35,997	35,775	1%

1) Annualised, as a % of average Credit Risk-Weighted Commitments. 2) Year-end 2004. 2.1. First half 2005 compared with first half 2004 Net profit before results on divestments at Banking increased sharply from EUR 1,082 million to EUR 1,482 million (+37%), due to higher total revenues and a lower change in provisions for impairment on loans. Total expenses remained flat. Total revenues went up by 9% to EUR 4,589 million1. Net interest income on interest margin products increased by 2% to EUR 2,113 million as good volume growth compensated for the overall low interest rate environment. Net interest income from Retail Banking and Commercial & Private Banking increased by 3% and 8%, respectively, and net interest income from the corporate segment remained stable. Realised capital gains not linked to financial markets activity amounted to EUR 401 million, down 10% compared with the same period last year. Results of Treasury and financial markets activities doubled to EUR 730 million thanks to exceptionally strong trading results, which typically peak in the second quarter, and positive (realised and unrealised) changes in the fair value of financial markets instruments. Net commissions and fees rose by 2% to EUR 1,054 million, mainly due to higher asset management fees and higher commissions on securities transactions. Dividends, shares in the results of associates and other investment income benefited from the revaluation of participating interests and higher dividends, increasing by 16% to EUR 123 million. Other revenues amounted to EUR 169 million, including a one-off EUR 48 million repayment of the 'deposit protection fund' in Belgium in the first quarter of 2005. The change in provisions for impairment on loans ended up 66% lower at EUR 37 million, compared with EUR 110 million last year, mainly due to lower additions and major releases amid a benign credit environment in the corporate loan segment. The credit loss ratio (calculated as a percentage of average Credit Risk-Weighted Commitments) dropped to 4 basis points from 12 basis points last year. Continued sound cost management has allowed total expenses to remain stable at EUR 2,568 million, despite the 6% increase in staff expenses. Other expenses went down by 7%. The cost/income ratio improved from 61.1% (pro-forma) to 56.0%. FTEs remained virtually stable, at 35,997, compared with year-end 2004. During the first half of the year the operating leverage, calculated as the differential between the growth in revenues and growth in costs, amounted to 9.3%. 1 To better reflect the underlying business trends, the analysis below is based on a different classification of net interest income, realised capital gains (losses) and (un)realised gains (losses). This change in classification has no impact on the net result. Strong inflows of new funds under management both at Private Banking (EUR 1.8 billion) and at Fortis Investments (EUR 6.4 billion) contributed to the 15% increase in funds under management to EUR 143.1 billion compared to year-end 2004. 2.2. Performance per Banking Business 2.2.1. Retail Banking

Key figures - Retail Banking	H1 2005	H1 2004	Change	Q2 2005	Q1 2005	Change
		Pro-forma
Net profit (in EUR million)	537	379	42%	217	320	(32%)
Cost / Income Ratio	61.6%	66.1%		68.2%	56.0%
Operating leverage	7.5%
FTEs	14,506	14,509 (1)	(0%)	14,506	14,651	(1%)

1) Year end 2004. Net profit at Retail Banking increased by 42% from EUR 379 million to EUR 537 million. The 32% drop in net profit in the second quarter compared to the first quarter was caused by the usual seasonal pattern in ALM results. All major revenue components contributed to the 11% increase in total net revenues. Net interest income went up 3% and commissions and fees increased 16% thanks to higher asset management and securities transactions-related fees. The change in provisions for impairment on loans remained low, despite the growth of the credit portfolio in the past years. Total expenses increased by 3% as higher staff expenses could not be fully offset by the lower level of other expenses. This increase is entirely due to the inclusion of a Consumer Finance entity (International Card Services) and to expansion of the activities of Fortis Investments. In Belgium, mortgage and life insurance sales were record high, due in part to several successful commercial campaigns. The online banking user base has grown by 14% since the beginning of the year to 884,000. In the Netherlands, the rollout of the Direct Service concept is on schedule, with 56 branches out of a network of 169 currently equipped. The bancassurance performance has improved as the sale of insurance contracts rose by 30%. The integration of Di bank in Turkey is on track, and Di bank will be rebranded into Fortis by the end of 2005. Total Retail Banking funds under management rose to EUR 101 billion, due to strong net intake (+EUR 6.7 billion) and growth in the equity and bond markets (+EUR 4.3 billion). Fortis Investments accounted for the major part of this increase. Its funds under management grew by 13% to EUR 95.6 billion compared to year-end 2004, largely due to EUR 6.4 billion in new inflows. 2.2.2. Merchant Banking

Key figures - Merchant Banking	H1 2005	H1 2004	Change	Q2 2005	Q1 2005	Change
		Pro-forma
Net profit (in EUR million)	651	440	48%	332	319	4%
Cost / Income Ratio	46.8%	55.5%		45.1%	48.4%
Operating leverage	19.8%
FTEs	3,999	3,908 (1)	2%	3,999	3,946	1%

1) Year-end 2004. Net profit at Merchant Banking went up 48% from EUR 440 million to EUR 651 million. Total net revenues increased by 33%. As is traditionally the case, trading results were very good in the first half of the year. Net interest income on interest margin products in the corporate banking segment remained stable, while net commission income was lower. The decrease in overall net interest income is related to IFRS. Under IFRS results on derivatives are split between net interest income and realised and unrealised gains (losses). In the first half of 2005 this led to lower net interest income and higher realised and unrealised gains. Underlying net interest income remained stable. Total expenses went up 6%, due to higher staff costs related to the increase in provisions for variable compensation. 2.2.3. Commercial & Private Banking

Key figures - Commercial & Private Banking	H1 2005	H1 2004	Change	Q2 2005	Q1 2005	Change
		Pro-forma
Net profit (in EUR million)	289	231	25%	142	147	(3%)
Cost / Income Ratio	56.4%	55.9%		58.7%	54.3%
Operating leverage	(0.9% )
FTEs	5,459	5,419 (1)	1%	5,459	5,394	1%

1) Year-end 2004. Net profit at Commercial & Private Banking advanced 25% from EUR 231 million to EUR 289 million. Total net revenues increased by 11%, mainly due to higher net interest income (+8%) and higher net commission income (+5%). The change in provisions for impairment on loans is historically low, ending up 50% lower than last year. Total expenses increased by 6% in line with the growing activities. Commercial Banking posted higher results, as revenues grew substantially faster than costs and the change in provisions for impairment on loans was lower than last year. Commercial Banking announced the opening of three new business centres in the second quarter (Budapest, Prague and Vienna). At Private Banking, funds under management increased by EUR 4.5 billion to EUR 56.8 billion, due to good net intake (+EUR 1.8 billion) and growth in the equity and bond markets. Late June Private Banking announced the acquisition of Dryden Wealth Management, which will add the UK, Taiwan and Monte Carlo to the countries in which this business line is already active. The acquisition also significantly strengthens Private Banking's position in Asia, Switzerland and the Netherlands. 2.2.4. Other Banking Other Banking includes all shared services entities and the corporate centre functions within the Bank, Asset and Liability Management (ALM), entities sold in 2004 (Fortis Bank Asia and GWK Bank), Fortis Hypotheekbank and, for 2004 only, International Card Services, which is recognised in Retail Banking for 2005. Income from ALM and expenses related to shared services are both allocated to the Banking business lines. Net profit in Other Banking decreased from EUR 50 million to EUR 5 million, due principally to lower capital gains, which are not allocated to the Banking business lines, the reallocation of International Card Services to Retail Banking, the sale of GWK Bank and Fortis Bank Asia and a higher change in provisions for impairment on loans. 3. Insurance

Key figures ? Insurance	H1 2005	H1 2004	Change	Q2 2005	Q1 2005	Change
(in EUR million)		Pro-forma
Net profit before results on divestments	684	564	21%	379	305	24%
Life	415	355	17%	225	190	19%
Non-Life	269	177	52%	154	115	33%
Other		32
Divestments (Seguros Bilbao)		145
Net profit	684	709	(4%)	379	305	24%
Operating leverage	20.0%
FTEs	12,711	12,937( 1)	(2%)
Life
Gross written premiums	3,862	3,412	13%	2,014	1,848	9%
Investment contracts without DPF	1,497	598	*	977	520	88%
Gross inflow	5,359	4,01	34%	2,991	2,368	26%
Technical result	341	270	26%	205	136	51%
Operating margin	493	419	18%	287	206	39%
Non-life
Gross written premiums	2,688	3,124	(14%)	1,05	1,638	(36%)
Excluding Assurant	2,688	2,646	2%	1,05	1,638	(36%)
Technical result	306	214	43%	174	132	32%
Operating margin	329	239	38%	187	142	32%
Combined ratio	94%	98%		93%	95%

1) Year-end 2004. 3.1. First half 2005 compared with first half 2004 Net profit before results on divestments - Seguros Bilbao: EUR 145 million in 2004 - increased by 21% to EUR 684 million. Non-life further improved its very strong performance of previous quarters, while the Life result rose sharply in the second quarter. Costs remained tightly controlled: operating costs dropped 18% (mainly due to Assurant), while FTEs went down 2% compared with the year end to 12,711. 3.1.1. Life Net profit before results on divestments at Life increased 17% to EUR 415 million due to a strong improvement in the technical result. Operating margin went up by 18%, driven by higher investment income and better risk margins. Total gross inflow rose by 34% to EUR 5,359 million, as a result of very strong sales in Portugal and Luxembourg. 3.1.2. Non-life Net profit before results on divestments at Non-life increased 52% to EUR 269 million. Gross written premiums went up 2% to EUR 2,688 million (excluding gross written premiums from Assurant in January 2004). Technical results ended 43% higher at EUR 306 million. The combined ratio improved from 98% to 94%, thanks to a lower expense ratio and to substantial improvements in claims ratios across all product lines. 3.2. Performance per Insurance Business 3.2.1. Insurance Belgium

Key figures - Insurance Belgium	H1 2005	H1 2004	Change	Q2 2005	Q1 2005	Change
(in EUR million)		Pro-forma
Net profit	296	251	18%	156	140	11%
Life	220	190	16%	118	102	16%
Non-Life	76	61	25%	38	38	(3%)
Operating leverage	13.5%
FTEs	4,938	5.172 (1)	(5%)
Life
Gross written premiums	1,867	1,752	7%	1,167	700	67%
Investment contracts without DPF	363	359	1%	228	135	69%
Gross inflow	2,23	2,111	6%	1,395	835	67%
Technical result	213	172	24%	131	82	61%
Operating margin	268	221	21%	144	124	16%
Non-life
Gross written premiums	612	579	6%	276	336	(18%)
Technical result	96	70	38%	49	47	7%
Operating margin	102	85	21%	51	51	0%
Combined ratio	92%	96%		92%	92%

1) Year-end 2004. Net profit rose by 18% to EUR 296 million from EUR 251 million, driven by both Life and Non-Life operations. Operating margin increased by 21% to EUR 370 million as stronger technical results more than offset lower allocated capital gains. Operating costs remained flat at EUR 176 million. At the end of the second quarter the number of FTEs stood at 4,938 (3,546 excluding the employees of Fortis Real Estate), representing a decrease of 5%. In Life, both the bank and broker channels contributed to the 6% increase in gross inflow to EUR 2,230 million. Production in the second quarter was particularly strong thanks to the successful commercial campaigns launched by Fortis Bank, yielding more than EUR 640 million in Individual Life. Gross inflow at Employee Benefits went up 14%, with Fortis Insurance Belgium as market leader aptly responding to market opportunities with a comprehensive product offering. Gross written premiums in Non-life advanced 6% to EUR 612 million, driven by all product lines. The Non-life operating margin climbed 21% to EUR 102 million as lower allocated capital gains were offset by a sharp rise in the technical result. The combined ratio improved to 92% from 96% last year due to a drop in the claims ratio. 3.2.2. Insurance Netherlands

Key figures ? Insurance Netherlands	H1 2005	H1 2004	Change	Q2 2005	Q1 2005	Change
(in EUR million)		Pro-forma
Net profit	276	215	28%	159	117	35%
Life	163	147	11%	90	73	24%
Non-Life	113	68	65%	69	44	52%
Operating leverage	5.8%
FTEs	4,736	4,809 1)	(2%)
Life
Gross written premiums	1,459	1,393	5%	569	890	(36%)
Investment contracts without DPF
Gross inflow	1,459	1,393	5%	569	890	(36%)
Technical result	123	99	25%	78	45	75%
Operating margin	216	199	8%	145	71	*
Non-life
Gross written premiums	1,229	1,281	(4%)	401	828	(52%)
Technical result	118	76	56%	62	56	12%
Operating margin	131	86	52%	71	60	20%
Combined ratio	92%	96%		92%	92%

1) Year-end 2004. Net profit increased by 28% to EUR 276 million, mainly due to a strong improvement in Non-life results driven by favourable claims development. Operating margin increased by 22% to EUR 347 million, due to better technical results in Life and Non-life. At the end of the second quarter, the workforce amounted to 4,736 FTEs, a decrease of 2% compared with year-end 2004. A reduction of 480 FTEs has been made so far, compared with a target of 750 FTEs by 2006. Gross written premiums at Life advanced 5% to EUR 1,459 million, due to an increase in Individual single premiums. Net profit ended 11% higher. The operating margin increased by 8% to EUR 216 million due to better investment results. Gross written premiums at Non-Life decreased by 4% to EUR 1,229 million, largely due to Accident & Health and Motor. At Accident & Health, gross written premiums declined from EUR 698 million to EUR 687 million, due to a change in legislation. Gross written premiums at Motor decreased from EUR 266 million to EUR 235 million, mainly due to stricter acceptance guidelines now being applied. The focus on a healthier portfolio is clearly reflected in the Non-life results. Net profit jumped to EUR 113 million, up 65% from EUR 68 million last year. The operating margin at Non-life went up 52% to EUR 131 million due to significant improvements in the claims ratio of both Accident & Health and Property & Casualty. As a result, the combined ratio further improved from 96% to 92%. 3.2.3. Insurance International

Key figures - Insurance International

H1 2005

H1 2004

Change

Q2 2005