Great-West Lifeco statement on Lehman and AIG Investment Exposures



    
    Readers are referred to the cautionary note regarding Forward-Looking
    Information and Non-GAAP Financial Measures at the end of this release.

    TSX:GWO
    

    WINNIPEG, Sept. 18, 2008 /CNW/ - In response to recent events in the
financial markets, Great-West Lifeco Inc. (Lifeco) today confirmed that it
holds C$101 million par value of fixed income securities of Lehman Brothers
Holdings Inc.
    In addition, Lifeco has exposures to American International Group Inc.
("AIG") as follows:

    
    -   American International Group Inc. fixed income securities with a par
        value of C$149 million;
    -   Sun America Life Insurance Company fixed income securities with a par
        value of C$66 million;
    -   American General Corp. fixed income securities with a par value of
        C$16 million;
    -   American General Finance fixed income securities with a par value of
        C$19 million;
    -   International Lease Finance Co. fixed income securities with a par
        value of C$15 million; and
    -   AIG Financial Products Corp. derivatives "in-the-money" position of
        C$82 million.
    

    The aggregate value of these exposures represents approximately
three-tenths of one percent of Lifeco's consolidated general account assets,
which were more than C$131 billion at June 30, 2008.
    Lifeco expects to record a charge to its third quarter 2008 net income as
a result of a decline in value of these investments. Under Canadian accounting
and actuarial rules, the amount of this charge will take into account an
assessment of expected future cash flows from these investments and the
related impacts on actuarial liabilities that are supported by these cash
flows.

    GREAT-WEST LIFECO

    Great-West Lifeco Inc. (TSX:GWO) is a financial services holding company
with interests in the life insurance, health insurance, retirement savings,
investment management and reinsurance businesses. The Company has operations
in Canada, the United States, Europe and Asia through The Great-West Life
Assurance Company, London Life Insurance Company, The Canada Life Assurance
Company, Great-West Life & Annuity Insurance Company and Putnam Investments,
LLC. Lifeco and its companies have more than $392 billion in assets under
administration and are members of the Power Financial Corporation group of
companies.

    Cautionary note regarding Forward-Looking Information

    This release contains some forward-looking statements about the Company,
including its business operations, strategy and expected financial performance
and condition. Forward-looking statements include statements that are
predictive in nature, depend upon or refer to future events or conditions, or
include words such as "expects," "anticipates," "intends," "plans,"
"believes," "estimates" or negative versions thereof and similar expressions.
In addition, any statement that may be made concerning future financial
performance (including revenues, earnings or growth rates), ongoing business
strategies or prospects, and possible future Company action is also a
forward-looking statement. Forward-looking statements are based on current
expectations and projections about future events and are inherently subject
to, among other things, risks, uncertainties and assumptions about the
Company, economic factors and the financial services industry generally,
including the insurance and mutual fund industries. They are not guarantees of
future performance, and actual events and results could differ materially from
those expressed or implied by forward-looking statements made by the Company
due to, but not limited to, important factors such as sales levels, premium
income, fee income, expense levels, mortality experience, morbidity
experience, policy lapse rates and taxes, as well as general economic,
political and market factors in North America and internationally, interest
and foreign exchange rates, global equity and capital markets, business
competition, technological change, changes in government regulations,
unexpected judicial or regulatory proceedings, catastrophic events, and the
Company's ability to complete strategic transactions and integrate
acquisitions. The reader is cautioned that the foregoing list of important
factors is not exhaustive, and there may be other factors listed in other
filings with securities regulators, including factors set out under "Risk
Management and Control Practices" in the Company's 2007 Annual Management's
Discussion and Analysis, which, along with other filings, is available for
review at www.sedar.com. The reader is also cautioned to consider these and
other factors carefully and to not place undue reliance on forward-looking
statements. Other than as specifically required by applicable law, the Company
has no intention to update any forward-looking statements whether as a result
of new information, future events or otherwise.

    Cautionary note regarding Non-GAAP Financial Measures

    This release contains some non-GAAP financial measures. Terms by which
non-GAAP financial measures are identified include but are not limited to
"earnings before restructuring charges", "adjusted net income", "earnings
before adjustments", "net income on a constant currency basis", "premiums and
deposits", "sales", and other similar expressions. Non-GAAP financial measures
are used to provide management and investors with additional measures of
performance. However, non-GAAP financial measures do not have standard
meanings prescribed by GAAP and are not directly comparable to similar
measures used by other companies. Please refer to the appropriate
reconciliations of these non-GAAP financial measures to measures prescribed by
GAAP.





For further information:

For further information: Marlene Klassen, APR, Assistant Vice-President,
Communication Services, (204) 946-7705


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