Assessing Violent Risks: How Terrorism Affects the Bottom Line in

Financial Services

20th May 2005

Impact on Financial Markets

Exclusive Analysis:

Political Environment

Domestic Economic & Corporate

Performance

Global Market Drivers

Impact on Financial Markets

Targets not always victims

Flight of Expertise; Expats

Increased security costs, insurance premium and time

Disruptions to the supply chain

Consumer confidence, spending patterns and costing assumptions

Impact of Violent Risk on Profitability

Can very large losses be avoided or passed on?

What is the role of informed pricing?

Political Risk Forecasting and Insurance/Reinsurance

Strategic intelligence company which forecasts violent and political risk

Make the Future Intelligible, Predictable and Profitable

400 analysts and specialist sources worldwide with a

London based editorial team

Run Global Indexes, including Lloyd’s Cargo Watch List

Proprietary Model for Realistic Disaster Scenario Planning

Introduction to Exclusive Analysis

INDEPENDENT

Privately owned

No broker ties

TRANSPARENT

Full visibility

Audit trail and

disclosure compliance

FOCUSSED

Forecasting is all we do

Revenue builds

existing company

REPUTATION

Total Client Accountability

Encourage

Discourage Neutral

70% of risks

27% of risks

3%of risks

0 claims Claims (all avoided by EA client):•Filipino power stations attacked•Colombia power station occupied•Banking chain: bomb in Nepal and 2 hoaxes disrupting business in India, Dubai•Banks in Turkey: ten bombs in 6-month period•Saudi company assets: attack on refinery killed 9•Argentinian banks: 2 bomb attacks•Iraqi helicopters: one lost and one forced landing

0 claims

Case Study of EA Advice

War

Civil Unrest

Political Risk

Terrorism

Risk Definitions

NPA Communist attack on Globe Telecom in Hermosa, Bataan

NPA are prepared to extend violence to banks and mining properties

Philippines: Globe Telecoms

Terrorism in Bolochistan: Pipelines Saudi succession and evolving target set Pipelines in Colombia Taxation of foreign energy companies in

Bolivia East Timor Equatorial Guinea Sao Tome Ceyhan-Baku pipeline

Energy

Oil from Caspian Sea through Azerbaijan, Georgia, Eastern Turkey to the Mediterranean Sea and then on to Western markets.

Strengthening of undemocratic regimes

Further civil unrest

Ceyhan-Baku Pipeline (BTC Project)

Banking

Banks

Suicide bombings 2003 in Istanbul

Al-Qaeda and a Turkish militant group (Great Eastern Islamic Raiders’ Front)

4 small bombs in Ankara outside HSBC branch 2004

HSBC announced it is to stay despite risk of further attacks

Banks – HSBC Attacks

Rioting in Mbuji Mayi, DR Congo

UDPS has flourished leading to civil unrest

Political mismanagement elevates instability

DR Congo: Mining

World’s main producer of cocoa

May 2005: Operation of Disarmament & Demobilization has been set in motion

Property will remain vulnerable

Ivory Coast: Cocoa Industry

Area with high concentration of tourists

Extensive damage to property

Threat to tourists industry set to increase

Hotels and Hospitality: Kenya Paradise Hotel 2002

Elections: January 2005

Who are the insurgents?

Elections have heightened sectarian and ethnic cleavages

Reintegration of Baathists

Kurdish autonomy

Case Study: Iraq’s Reconstruction

2003 2004 2005

Escalating civil unrest

Hydro carbon Law to destabilize Mesa

Departure of GonzalezAggressive militant protest

Left wing parties increase pressure on governmentEscalating civil unrest

Case Study: Bolivia (Gas)

Assessing Violent Risks: How Terrorism Affects the Bottom Line in

Financial Services

20th May 2005