PHILAMLIFE REGISTERS STRONG PERFORMANCE IN 2002

MAKATI CITY, March 20, 2003 - The Philippine American Life and General Insurance Company (Philamlife), the largest and most diversified insurance company in the Philippines, announced that it had a good year in 2002, with Gross Revenues reaching P16.4 billion, an increase of 16.3% compared to P14.1 billion in 2001. Net Income grew 19.5% to P3.0 billion from P2.5 billion reported in 2001. Total Assets reached P72.5 billion, an increase of 12.2% over the previous year.

Commenting on the company's 2002 performance, Philamlife President and CEO Jose L. Cuisia, Jr. said: "Despite the tough business environment we faced throughout the year, Philamlife responded remarkably, setting record amounts in business generated. In 2002, we generated a record P9 billion in Total Premium Income, a remarkable feat unsurpassed in the life insurance industry. This represents a 14.3% increase compared to the P7.8 billion posted a year earlier. New business grew a strong 24.3% to P2.2 billion, while our Renewal Premium Income remained solid at P6.8 billion. We also set a new monthly sales record for the third straight year, achieving P249 million Ordinary First Year Premium Income in August 2002. I attribute our good sales performance to our continued innovation in terms of new products and services, as well as the outstanding competence and professionalism demonstrated by the Philamlife agency and employee force.

"We have also maintained our commitment to nation-building through the provision of long-term funds. Our Invested Assets reached P68.7 billion in 2002. We made significant long-term investments in Philippine government securities, with net placements in Fixed Rate Treasury Notes (FXTNs) and Philippine government-issued dollar bonds amounting to P4.9 billion in 2002. Philamlife's total government bond holdings reached P36.2 billion as of end-2002. Furthermore, I believe our investment strategies have paid off, with our Net Investment Income increasing 21.3% to P6.3 billion in 2002. This is an impressive performance, particularly since it was achieved in an environment with generally low interest rates and a dearth in investment alternatives.

"Finally, I am proud that we have consistently delivered on our promise to our policyholders. We paid over P3.3 billion in benefits to our policyholders in 2002. This represents a significant 13.5% increase over the P3.0 billion we gave out the previous year.

"The new year promises to be another challenge for us, particularly with the continuing low interest rate environment, but I believe we are well equipped to exceed last year's performance. Philamlife is among the most stable and financially strong companies in the country and we are backed by our parent company, American International Group, Inc. (AIG), the world's leading U.S.-based international insurance and financial services organization. We continue to benefit from our strong reputation for top quality service and commitment to our policyholders.

" In its recent Annual Stockholders Meeting, Philamlife declared a cash dividend of P12 per share amounting to P2.07 billion, payable to shareholders. The company also re-elected the following as members of the Board of Directors: Maurice R. Greenberg, Chairman and Chief Executive Officer, American International Group (AIG) and Chairman of the Board, Philamlife; Edmund S.W. Tse, Senior Vice Chairman and co-Chief Operating Officer, AIG, and Vice Chairman, Philamlife; Edward E. Matthews, Senior Vice Chairman for Investments and Financial Services, AIG; Jose L. Cuisia, Jr., President and CEO, Philamlife; Cesar C. Zalamea, President & Managing Director, AIG Investment Corp. (Asia), Ltd.; Washington Z. Sycip, Founder, SGV Group; Ricardo J. Romulo, Senior Partner, Romulo, Mabanta, Buenaventura, Sayoc & de los Angeles Law Offices; Cesar A. Buenaventura, Managing Partner, Buenaventura, Echauz & Partners; and Ramon L. Jocson, General Manager, IBM Global Services ASEAN/South Asia.

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The Philippine American Life and General Insurance Company is the largest and most diversified insurance company in the Philippines and the undisputed market leader for over half a century. It offers the most comprehensive range of life and general insurance products that provide protection, savings and investments, education, accident and health, property and casualty coverage. Philamlife has more than a million individual and corporate policyholders, and maintains the most extensive network of offices and sales agencies nationwide.

Philamlife's affiliate business includes a wide range of diversified financial services in health care, pre-need plans, mutual funds, credit cards, banking, property and casualty, and property development.

Philamlife is a member company of American International Group, Inc. (AIG). AIG is the world's leading U.S.-based international insurance and financial services organization, the largest underwriter of commercial and industrial insurance in the United States, and among the top-ranked US life insurers.

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