2007 Financial Results - Desjardins Financial Security

Accelerated and sustained growth

Net premium growth of 5.6%
Group insurance premiums up 14.9%
Net income of $216.7M, up 43.2%
Operating income growth of $288.3M, up 42.2%
Return on shareholder equity of 27.5%
Profitability in all business lines

Lévis (Québec), March 18, 2008 – At year-end, December 31, 2007, Desjardins Financial Security's net income totalled $216.7 million, crossing the $200-million mark for the first time. This excellent performance represents a $65.4 million or 43.2% increase over 2006, when net income totalled $151.3 million. Operating income amounted to $288.3 million for a 42.2% increase.

Business growth across the country, coupled with investment performance and improved productivity, was one of the key factors behind the Company's success.

With respect to overall business growth, insurance and annuity premium income increased 5.6% to stand at $2.6 billion. Insurance sales rose 14.0% to total $415.7 million. Assets under management and administration stood at $22.6 billion compared to $19.9 billion at the end of 2006, representing a 13.2% increase.

The Company's profitability in 2007 was affected by the subprime mortgage credit crisis worldwide, which led to liquidity problems on the non-bank-sponsored asset-backed commercial paper (ABCP) market. At December 31, 2007, Desjardins Financial Security had ABCP holdings of $161.2M after recognition of a $34.2M decrease in value. This depreciation reduced the Company's net income for 2007 by $17.8 million.

The portion of the Company's net income attributable to the shareholder totalled $211.1 million, for an increase of $65.3 million over 2006. Return on shareholder equity was 27.5%. With results like these, the Company continues to contribute to the profitability of Desjardins Group, the largest integrated cooperative financial group in Canada, with declared combined surplus earnings before member dividends of $1.1 billion at the end of 2007.

Fourth Quarter Results

For the period of October 1 to December 31, 2007, net income stood at $50.4 million, for an 18.0% improvement over Q4 2006 ($42.7 million). Insurance premium income for the period totalled $611.2 million, for a 12.9% increase.

Mr. Alban D'Amours, President and Chief Executive Officer of Desjardins Group and also Chief Executive Officer of Desjardins Financial Security, was very pleased with the life and health insurance subsidiary's strong growth across the country. "These exceptional results are a tribute to the quality of our Company's service offer and the hard work of our teams, which enabled us to reach our ambitious objectives. Desjardins Financial Security is asserting itself more and more on the Canadian market, where it is consolidating its position and making major gains, notably in the group insurance market, and contributing in a very tangible way to the success of Desjardins Group across Canada."

Mr. Richard Fortier, President and Chief Operating Officer of Desjardins Financial Security, was also extremely happy with the Company's performance last year. "On the basis of these results, we plan to forge ahead and strengthen our position as the fourth largest life and health insurer in Canada and reinforce our leadership position in the Quebec market. We will continue to focus our efforts on growing organically in all our activity sectors and will pay special attention to the development of our integrated service offer in the Desjardins caisse network."

Sector Performances

Strong growth in group and business insurance sales and premiums - Group and business insurance sales and administered premiums passed the $235-million and $2-billion mark respectively. Overall sales have grown significantly, from $195.6 million in 2006 to $237.3 million in 2007. Sales outside Quebec alone reached $180 million, in contrast to $154.8 million in 2006. These results are due to major group sales recorded outside Quebec, mainly in the public and parapublic sector. Since signing a $70-million contract with the Government of Newfoundland and Labrador in 2006, the Company has continued to expand its business portfolio by adding an $85-million insurance partnership with the Ontario Hospital Association and a $21.4-million agreement with the Newfoundland and Labrador Teachers' Association.

Individual insurance posts improved results - In 2007, individual insurance sales grew by $3.5 million to total $41.9 million. Premiums stood at $392.6 million, up $18.4 million from 2006. Sales and premiums from the network of caisse-dedicated financial security advisors rose by 6.5% and 21.1% respectively over last year.

Segregated funds records 32.4% growth - The savings sector has recorded good results once again. Sales totalled $1.1 billion, an improvement of $48.2 million over 2006. This excellent growth of 4.5% is due mainly to a combination of Helios and Millennia segregated fund sales, mutual fund sales, and group retirement savings sales.

In individual savings, sales totalled $255.8 million in 2007. Group retirement savings sales stood at $218.5 million, with accumulation products accounting for $96.7 million, for a 14.9% improvement over 2006, and payout annuities accounting for $121.8 million. With respect to segregated fund sales, combined sales of Helios and Millennia products reached $151.7 million, for a 32.4% increase over 2006.

About Desjardins Financial Security
Desjardins Financial Security, a subsidiary of Desjardins Group, the largest integrated cooperative financial group in Canada, specializes in providing life insurance, health insurance and retirement savings products and services to individuals and groups. Every day, over 5 million Canadians rely on Desjardins Financial Security to ensure their financial security. Desjardins Financial Security employs over 3,900 people and administers over $22.0 billion in assets from offices in several cities across the country including Vancouver, Calgary, Winnipeg, Toronto, Ottawa, Montréal, Québec, Lévis, Halifax and St. John's.

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Source: Sarah Twomey
Communications Advisor
Tel.: 416-926-2700, extension 2015
Toll free: 1-877-906-5551, extension 2015