Inferencia basada en los m´ etodos MCMC Muestreo de Gibbs

The company wrote premiums for an amount of _68.7 million and closed the year with a pre- tax profit of _11.2 million and 88,097 insured vehicles.

MAPFRE MUTUALIDAD set up this company as an ancillary operation, in order to test the advantages and disadvantages of certain new departures from its traditional practices, such as centralised underwriting, telephone business and personalised tariffs. Having accomplished these objectives, it was considered that it was no longer necessary to maintain it as an independent legal entity; therefore it was taken over by MAPFRE MUTUALIDAD on 1 December 2003.

MAPFRE SEGUROS GERAIS (PORTUGAL)

The Portuguese insurance sector accumulated losses of _358 million between 2000 and 2002 amounted, and indications are that 2003 will also be a year of poor results. In spite of this, MAPFRE SEGUROS GERAIS has had excellent results for the sixth consecutive year, in which it exceeded its budget by a wide margin.

Premiums written were _66.6 million, a 24.4% increase over the previous year. The loss ratio improved in comparison with 2002, to a figure of 54% of premiums written, while operating expenses fell by 3.3%.

This substantial improvement in all the management indicators led to a pre-tax profit of _5.8 million, equal to 8.7% of premiums written and 54% larger than the figure for the previous year.

The number of policies grew by 14% to a total of 182,193, of which: 68% corresponded to Motor insurance; 26% to General Insurance; and the remaining 6% to Accidents at Work.

In July 2003 MAPFRE SEGUROS GERAIS was named Best Non-life Insurance Company in Portugal by a panel composed of Deloitte & Touche, Dun & Bradstreet and the business magazine EXAME, which highlighted its dynamism, profitability and financial stability. A rigorous underwriting policy, a proactive attitude to risk prevention and to the development of cross-border business agreements, cost control and prudent financial investments, have been, together with the employees’ identification with the company’s mission and business vision, the keys to effective management.

CESVIMAP

The Centre for Road Research and Safety (CESVIMAP) has achieved all the targets set for the year, providing MAPFRE MUTUALIDAD with all planned services related to the cost of car repairs. Its most relevant activities have been the training courses for adjusters and the preparation of research reports on repair methods and times to be applied in objective valuations of repairs of bodywork and paintwork.. In all 202 training courses were given to 2,056 persons.

The creation of CESVIMAP’s virtual classroom, as an alternative and a complement to a physical training presence, should also be noted. The introductory "on line" course for vehicle adjusters is the first of those that will make up the future training programme through this medium. Special mention should also be made of the approval by the Generalitat de Catalunya of five textbooks on the specialist subject of bodywork, at the intermediate level of the professional series Maintenance of Self-propelled Vehicles.

This attitude towards extending knowledge by means of courses and publications originates from research activities that can be enumerated as follows: 16 vehicle analyses, with their respective repair manuals and repair costs reference scale; 40 technological tests of equipment, tools and repair materials; 15 research projects on materials and vehicle repair techniques; and 125 reports on reconstructions of traffic accidents.

In 2003 construction of the new building for the Treatment Centre for Withdrawn Vehicles (VFU) was completed. In these new installations covering an area of more than 6,000m2, furnished with the most advanced equipment, vehicles that are total write-offs will be cleaned of contaminants, and any re-usable parts will be stripped and sold. It is expected to be operational in the first quarter of 2004.

CESVIMAP had revenues of _13.9 million during the year.

CLUB MAPFRE DEL AUTOMÓVIL (The Automobile Club)

The purpose of this company is to provide policyholders with services and added exclusive benefits in connection with vehicles, drivers and driving. During its first complete year of operation it attracted 70,017 members and 8,590 participating establishments.

MULTICENTRO MAPFRE DEL AUTOMÓVIL (MAPFRE multi-brand car dealership)

The business of this company focuses on offering to policyholders and the general public vehicles under favourable conditions and with a full guarantee.

The results of the first full year of the Pamplona multicentro were positive: 669 vehicles were sold, procedures for selling insurance and financing were developed and, more importantly, useful experience was gained in this new line of business, which will be beneficial to the next multicentros in Alcalá de Henares, Valencia and Oviedo, for whose construction the initial steps were taken in 2003.

MAPFRE RENTING

The business of this company focuses on offering to policyholders and the general public the opportunity to purchase a vehicle by means of an operating lease system. In 2003 a total of 2,161 contracts were signed and 1,911 vehicles were delivered, which takes the fleet to 2,793 vehicles.

SUBSEQUENT EVENTS

After obtaining the mandatory approvals, on 1 January 2004 the takeover of MAPFRE AGROPECUARIA by MAPFRE MUTUALIDAD was finalised.

OUTLOOK

In 2004, MAPFRE MUTUALIDAD intends to continue along the lines of its present strategy, based on growing business volumes, gradual cost reduction and the improvement of services for, and communications with mutualists.

The budgets approved by the Board of Directors for 2004 estimate net premiums written of _2,065 million, a loss ratio equal to 70% of premiums written and an expense ratio of 20%.

Despite a difficult start due to international geopolitical uncertainty, 2003 ended positively for the financial markets, breaking the negative trend started in 2000. The gradual recovery in confidence by economic agents after the Iraq war, the gradual improvement in the global economic environment, assisted by a background of historically low interest rates, and good company profits were the principal factors which contributed to significant rises in the stock markets. Other distinctive features of the year were the marked depreciation of the US Dollar, high oil prices, accommodating monetary policies implemented by the central banks in order

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GOVERNING BODIES

Board of Directors

Chairman

Mr. Sebastián Homet Duprá Chairman

1st Vice-Chairman

Mrs. Mª Jesús Fernández Antón 2nd Vice-Chairman

Mr. Pedro Unzueta Uzcanga

1st Vice-Chairman

Member Managing Director

Mr. Víctor Bultó Millet

2nd Vice-Chairman Chairman

Directors

Mr. Rafael Fontoira Suris Mr. Santiago Gayarre Bermejo Mr. Luis Hernando de Larramendi Mr. Manuel Jesús Lagares Calvo Mr. Alberto Manzano Martos Mr. Juan Martín Sáinz de la Maza Mrs. Francisca Martín Tabernero Mr. Antonio Miguel-Romero de Olano Mr. Filomeno Mira Candel

Mr. Mariano Pérez Claver Mr. Francisco Ruiz Risueño Mr. Esteban Tejera Montalvo Mr. Enrique de la Torre Martínez (1) Mr. Carlos Vela García-Noreña

Member Member Member Member Member Member Member Member Member

Secretary (not a director)

Mrs. Mª Presentación Ataz Orihuela Secretary Deputy Secretary to the Executive Committee

Mr. Luis María Polo Rodríguez

(1) Representing PARTICIPACIONES Y CARTERA DE INVERSIÓN S.L.