Malaysia + Asia Pacific Investment Review & Outlook

1. 2Q06 Presentation to MAAKL Malaysia + Asia Pacific Investment Review & Outlook

2. OVERVIEW • A quick recap of 1Q2006 • Current market snapshot • Key issues ahead • Better opportunities outside Malaysia? • Fund performance review • Fund focus for 2Q2006

3. 1Q2006 – Rather eventful • Minor Cabinet reshuffle in mid-Feb • OPR increased by 25 bp to 3.25% • Petrol price raised by 19%-23% • Earnings momentum still weak in the latest results season – 46% below expectations, 42% in line, 12% above * * Source : JP Morgan

4. 1Q 2006 – Rather eventful • A strong January as Ringgit/USD rose from 3.78 at end-2005 to about 3.70 currently, closely tracking the Renminbi • Reversal of foreign flows into net INFLOWS of USD1.7bn in first two months of 2006 from net OUTFLOWS of USD6.6bn in preceding two months

5. 1Q 2006 – The Ringgit push KLCI rose from 899.79 at end-2005 to a high of 929.39 on 6 Feb before consolidating sideways

6. Improved Ringgit outlook

7. 2. Current market snapshot

8. Current market snapshot

9. Dividend returns exceed FD rates

10. Current market snapshot

11. Recapping GLC’s timetable • Up to mid-2005 - mobilisation, diagnosis & planning • Up to 2006 – generate momentum • 2007 onwards – tangible results • 2010 – full national benefits In 2005, only 5 out of 24 Khazanah-owned stocks outperformed the KLCI; About one third of companies were in losses another one-third reported flat to lower profits

12. 3. Key Issues/Events Ahead

13. Key issues ahead • GLC restructuring – Invest Malaysia Conference 22-24 Mar 2006 • The 9th Malaysia Plan - 31 Mar 2006 • The National Automotive Policy – still pending

14. Key issues ahead • Further interest rate hikes ? Watch out for FOMC meetings on 28 Mar/10 May, BNM policy statements on 26 Apr/31 May • The direction of palm oil prices? • Listing of China-based companies?

15. Still awaiting decisive turning point Still a case of downside limited, while sustainable upside hinges on among others, earnings, interest rates, currency and key issues such as politics and GLC progress

16. 4. Better opportunities outside Malaysia???

17. KLSE catching up in performance gap? % chg 2005 2006YTD* KLCI (0.8) 2.5 China-H shares 12.4 20.2 Hong Kong 4.5 6.2 Indonesia 16.2 10.2 Korea 54.0 (3.9) Philippines 15.0 1.9 Singapore 13.6 5.3 Taiwan 6.7 (1.0) Thailand 6.8 2.2 *up to 17 Mar 2006

18. Malaysia – Still Trading At Premium Source: JP Morgan and IBES

19. KLSE – Highest dividend yield in region

20. Better opportunities outside Malaysia? • Except Malaysia and Taiwan, all regional markets have risen by double-digit levels since 2005 • “Sell in May and go away”???

21. 2Q 2006 Outlook – Fairly subdued • Downside limited with support from dividends, domestic liquidity and reduced foreign shareholding • Positive turning point hinges on interest rates, currency, earnings momentum and GLC reforms • Concerns over post-9MP lull – buy on rumours, sell on news • Regional markets may need a breather

22. Still neutral for 2Q2006

23. Fund Focus – Slightly defensive Previous Focus Current Focus Bond/Money MarketBond/Money Market MAAKL As-Saad MAAKL As Saad Equity FundsEquity Funds MAAKL Equity Index MAAKL Al-Fauzan MAAKL E80 MAAKL Dividend MAAKL Syariah Index MAAKL Al-Umran MAAKL Al-Fauzan MAAKL Pacific (?) MAAKL Pacific

24. Fund Performance Review –17 Mar 2006

25. Thank you

26. Disclaimer Please note that the price of shares in, and the income from, any Meridian Asset Management fund may go down as well as up and may be affected by changes in currency exchange rates. Past performance is not indicative of future performance. An investor may not get back the amount invested. Any products mentioned herein are for illustrative purposes only and are not intended as an offer to subscribe for any funds. Meridian Asset Management is owned by MAA Holdings and NTY Enteprises Sdn Bhd.