2007 Second Quarter Financial Results - Desjardins Financial Security reports strong growth across Canada



    
    Net earnings up 70.8%
    Return on shareholder equity of 25.7%
    Insurance sales growth of 22.9%
    Gross insurance premiums up 12.0%
    Profitability across the business lines
    

    LEVIS, QC, Aug. 27 /CNW Telbec/ - Desjardins Financial Security continues
to have a very strong year. At the end of the first half of 2007, the net
earnings of the life and health insurance and retirement services provider had
risen from $69.2 million in 2006 to $118.2 million on June 30, 2007, for an
increase of 70.8%.
    After six months, the Company's income from insurance and annuity
premiums and investment and other income stood at $1,386.4 million. Gross
insurance premiums alone accounted for $1,178.5 million, up 12.0%, or
$126.2 million. The Company recorded growth of 7.2% in Quebec and 25.1% in the
other provinces. New insurance sales figures were impressive at
$210.0 million, for an increase of $39.1 million over the first half of 2006.
These excellent results are in part attributable to the sale of major group
contracts in Ontario, Newfoundland and Labrador and Quebec. A few weeks ago,
the Ontario Hospital Association signed a $75 million group insurance contract
with Desjardins Financial Security for the benefit of the 70,000 employees of
the Ontario health network's 185 employers. The contract took effect on
August 1.
    The share of Desjardins Financial Security's net earnings attributable to
the Desjardins caisses, the Company's ultimate shareholders, stood at
$111.4 million, up $43.3 million over last year. Return on shareholder equity
was 25.7% versus 19.4% after the first two quarters of 2006, and remains one
of the best in the financial services industry. The Company continues to make
a substantial contribution to the profitability of Desjardins Group, its
parent company and Canada's largest integrated cooperative financial group,
whose net earnings before patronage dividends between January and June 2007
stood at $580 million.
    Assets under management and administration totalled $22.4 billion, for an
increase of $1.6 billion since the beginning of the year.

    Second quarter results
    ----------------------

    For the period of April 1 to June 30, 2007, net earnings stood at
$68.4 million compared to $38.7 million in the second quarter of 2006.
Insurance premium income totalled $598.1 million, for a gain of 12.4%, while
sales totalled $112.0 million.
    Commenting on these results, Mr. Alban D'Amours, President and Chief
Executive Officer of Desjardins Group, and also Chief Executive Officer of
Desjardins Financial Security, said he was very pleased with the remarkable
progress the Company had made in the Canadian market. "Desjardins Financial
Security continues to differentiate itself in the Canadian marketplace, where
it is enjoying a great deal of success, especially in the group and business
insurance market. The quality and added value of Desjardins Financial
Security's product offering is getting more and more recognition in the public
and parapublic sectors and giving the Company an edge over its main
competitors."
    Desjardins Financial Security's President and Chief Operating Officer,
Mr. Richard Fortier, said these results were the outcome of rigorously
applying the Company's 3-year strategic plan. "Without continually striving to
improve our operational efficiency and significantly reduce our unit costs, we
wouldn't be able to develop and market the competitively priced products and
services we are offering not only to groups and businesses, but also to
individuals, including the members of the Desjardins caisses, our financial
centre clients and business partners.

    Sector Results
    --------------

    Strong growth in group insurance sales

    In the first six months of 2007, group and business insurance sales rose
by 24.2% to total $189.6 million. Gross premiums stood at $695.5 million, for
an increase of $107.8 million over the first six months of 2006. These
excellent results stem from the enrolment of groups with 1,000 or more
participants and the natural growth of the groups already in place. Premiums,
and credit insurance premiums in particular, generated by plans offered
through financial institutions, including the Desjardins caisses, totalled
$236.7 million, for an increase of $10.2 million.

    Growth in individual insurance sales and premiums

    In Individual Insurance, new sales realized during the six-month period
ending on June 30 through the SFL financial centre network, Desjardins
Financial Security Independent Network, and the Financial Security Advisors
assigned to Desjardins caisses, grew by 12.1% to total $20.4 million. Gross
premiums amounted to $230.4 million, for an increase of $9.1 million over last
year.

    Increase in mutual fund sales

    In Savings, overall sales totalling $660.5 million exceeded last year's
figures by $18.5. Mutual funds stood at $380.7 million versus $275.9 million a
year ago. The marked growth (27.0%) in Millennia segregated fund sales, which
reached $85.9 million, brings total individual savings sales for the first
half of the year to $143.1 million, down 6.2% over 2006 results. In group
retirement savings, sales totalled $136.7 million on June 30, which represents
a 36.0% decline over the corresponding period in 2006, when major payout
annuity contracts were signed.

    About Desjardins Financial Security

    Desjardins Financial Security is a subsidiary of Desjardins Group, the
largest integrated cooperative financial group in Canada, and specializes in
group and individual life and health insurance, and retirement savings
products and services. Every day, over 5 million Canadians rely on Desjardins
Financial Security to ensure their financial security. With a staff of over
3,700 employees, Desjardins Financial Security manages and administers over
$22 billion in assets from offices in major cities across the country,
including Vancouver, Calgary, Winnipeg, Toronto, Ottawa, Montreal, Québec,
Lévis, Halifax and St. John's.

    Information:
    For more information, visit www.desjardinsfinancialsecurity.com




For further information:

For further information: Shannon Bowness, External Communications
Advisor, (416) 926-2700, toll-free: 1-877-906-5551, ext. 2015,
shannon.bowness@dfs.ca; Virtual pressroom:
http://www.desjardinsfinancialsecurity.com/press

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