Disposal

Chesnara PLC
01 July 2004




                      Disposal of Key Retirement Solutions

Chesnara announces that yesterday it completed the sale of its specialist equity
release and retirement planning IFA company, Key Retirement Solutions Limited 
('KRS'), to its management for a total consideration, including repayment of
loans, of £2.8m in cash.



KRS is a firm of independent financial advisers, which provides advice primarily
on equity release schemes, but also on other related products such as term
assurance and annuities. The company employs four board directors and a further
team of 70.  Following the disposal Chesnara will employ 195 people.



The Group had previously written down the value of its investment in KRS to nil
and has realised a book profit of £2.6m at both the pre and post tax earnings
level. Therefore the net assets and embedded value of Chesnara, which were
£54.2m and £152.7m respectively at 31 December 2003, will increase by this
amount. As disclosed in Chesnara's Listing Particulars dated 18th March 2004,
KRS made a net profit of £0.2m in the year to 31st December 2003.



The life assurance division of Countrywide Assured Group plc was established in
1988 and on 25th May 2004 Chesnara was listed on the London Stock Exchange as
the new holding company for these activities.



Graham Kettleborough, Chief Executive of Chesnara, commented:

'The sale of KRS is the first step for Chesnara in its pursuit of an independent
strategy to maximise cash flows and shareholder returns through increased
operating efficiency.  We are actively looking at ways of minimising operating
costs, a strategy which is likely to include the outsourcing of certain
operations and which may also include acquiring or managing other closed books
of insurance business in the future.'



ENDS



For further information contact:
Graham Kettleborough, Chief Executive, Chesnara plc      [phone]
Serra Balls, Cubitt Consulting                           [phone]


Notes:



Countrywide Assured plc ('CAplc'), the principal operating subsidiary of
Chesnara plc, was established in 1988 as the life assurance division of
Countrywide Assured Group selling mortgage-related life assurance products
through Countrywide Assured Group's financial services division.  In August
2003, CAplc was substantially closed to new business following the
implementation of a distribution agreement between Countrywide Assured Group's
financial services division and Friends Provident. This agreement was
established in August 2002 following Countrywide Assured Group's decision to
switch new business from CAplc to Friends Provident. In 1995, CAplc acquired
Premium Life, a life assurance company, and integrated it into its existing
operations. Today Chesnara's primary subsidiary CAplc manages an existing book
of life assurance policies, personal pensions and long-term care products; it
continues to service its existing clients and markets Guaranteed Income and
Guaranteed Growth Bonds. Chesnara is based in Preston and it administers
approximately 230,000 policies, most of which are either non-linked term
assurance, unit-linked endowment policies and guaranteed bonds.


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