Foreword of the Chairman of the Board of Directors

2010 will definitely remain an excellent vintage for Komerční pojišťovna, which could not better celebrate its 15th anniversary. 2010 will also be a very good year for the life insurance business in the Czech Republic as a whole.

Year after year, regardless of global economic conditions, it is confirmed that the Czech life insurance market is growing. Again in 2010, it went up by 19% while GDP grew by 2%. It goes on demonstrating that the Czech Republic citizens are fully conscious of the importance to protect themselves or their relatives and to secure their future revenues. Such a trend is observed in most of the developed countries.

In this growing market, why not say that Komerční pojišťovna’s 2010 performance was simply extraordinary. With sales reaching almost CZK 9 billion, the company grew by nearly 86% compared to 2009 – hitherto the year in which the company registered the best performance in its history. On the life insurance market, Komerční pojišťovna moved year on year from the 6th position to the 2nd position with more than 12% market share. Total assets under management amounted to CZK 21.5 billion, +52% compared to last year end.

One of the reasons for this success stems from the bank insurance business model which is steadily proving to be very well adapted to clients needs with an average growth exceeding the total insurance market growth. Additionally, Komerční pojišťovna benefited in 2010 from the strong dynamism and the strong positioning on the market of Komerční banka and its subsidiaries – ESSOX, Modrá pyramida and, newly, KB Pension fund. Across all these distribution channels we see the positive impacts of the Group strategy which puts synergies among its top priorities.

One of the other key drivers of the success is the permanent client-oriented strategy all across the Group and of course in Komerční pojišťovna. In spite of the still unstable financial market situation in 2010, KP is able to provide policyholders with above standard remunerations on their life insurance contracts as they reached 3.1% on average and up to 3.3%.

Such performance is not achieved to the detriment of company stability, far from it. The company is going on building solid financial foundations thanks to regular financial profits, cautious reserving policy, conservative investment strategy and constantly enhanced operational efficiency. The company can also benefit from the soundness of its shareholders, Komerční banka and SogEcap, who both are key players on their markets and who decided to increase the share capital of the company to support its strong development.

Komerční pojišťovna has key trumps to go on developing and offering the products and services clients are entitled to expect. Our company is also well equipped to give satisfaction to all its distribution channels who share the same vision regarding client satisfaction. And after a promising start in 2010, we will do our best to convince many other commercial partners outside the KB Group to join us.

I am also confident because I know the company can count more than ever on the professionalism and the motivation of all its staff members, a key strength that the company intends to go on developing. In this area, many actions are conducted to enable the company to keep and attract talents and to offer all employees self development and interesting careers opportunities within the Group.

With such strengths and successful development and thanks to all the ongoing projects the company has launched, I consider Komerční pojišťovna to be fully in line with the global targets Societe Generale Group has defined in its 5 years program “SG Ambition 2015”, a program that puts clients, employees, and operational efficiency among the top priorities in the global strategy.

Laurent Dunet

Laurent Dunet

Chairman of the Board of Directors and CEO