Interim Results - Part 3

Old Mutual PLC
5 September 2000


Part 3
                           OLD MUTUAL PLC
                     Embedded value information

     1  Embedded value
The embedded value of old Mutual plc at 30 June 2000 is set out
below, together with the corresponding position at 31 December 1999.
                                          £m                     Rm
                           At 30      At  31       At 30      At 31
                            June    December        June   December
                            2000        1999        2000       1999
Adjusted net worth       4,450         4,608      45,737    45,791
Equity shareholders'     3,361         3,513       34,540    34,907
funds
Excess of market value   1,108        1,114        11,388    11,069
of listed subsidiaries
over their net asset
value
Adjustment to include    (19)     (19)          (191)     (185)
UK and offshore life
subsidiaries on a
statutory solvency
basis
Value of in-force        764      806           7,846     8,003
business
Value of in-force        840      884           8,628     8,781
business before cost of
solvency capital
Cost of solvency         (76)     (78)          (782)     (778)
capital
                                                          
Embedded value           5,214    5,414         53,583    53,794

An  embedded  value  is an actuarially determined  estimate  of  the
economic value of a life assurance company, excluding any value that
may be attributed to future new business.  Old Mutual plc's embedded
value is the sum of its adjusted net worth and the present value  of
the  projected  stream  of future after-tax profits  from  its  life
assurance business in-force at the valuation date, adjusted for  the
cost  of  holding  solvency  capital  equal  to  the  South  African
Statutory  Capital  Adequacy Requirement  (or  equivalent  for  non-
African operations).

The   adjusted  net  worth  is  equal  to  the  consolidated  equity
shareholders'   funds  adjusted  to  reflect  the   Group's   listed
subsidiaries  at  market value, and UK and offshore  life  assurance
subsidiaries on a statutory solvency basis.

The  embedded  value  does  not include a market  valuation  of  the
Group's non-acquired asset management subsidiaries (including  asset
management  business written through the life assurance  companies),
nor  of any other non-life business of the Group.  The adjusted  net
worth includes goodwill in respect of acquired businesses.

No  account has been taken of the proposed capital gains tax  to  be
introduced in South Africa with effect from 1 April 2001.  The South
African  tax  authorities  have  so far  only  issued  a  discussion
document  setting  out  initial  proposals,  and  it  was  therefore
considered  premature to adjust the embedded value  to  include  the
possible impact of capital gains tax at this stage.

The table below sets out a geographical analysis of the value of in-
force business at 30 June 2000 and 31 December 1999.

                                         £m                        Rm
                          At 30       At 31         At 30       At 31
                           June    December          June    December
                           2000        1999          2000        1999
South Africa                650       687           6,686      6,830
Individual Business         424       448           4,362      4,455
Group business              226       239           2,324      2,375
Rest of World               114       119           1,160      1,173
Value of in-force           764       806           7,846      8,003
business

The assumption used to calculate the embedded value are set out in
section 4.
                            OLD MUTUAL PLC
                  Embedded value information (cont'd)

2.       Embedded value profits
Embedded value profits represent the change in embedded value over the
period, adjusted for any capital raised and dividends proposed.  After-
tax  embedded value profits for the six months to 30 June 2000 are set
out  below, together with the corresponding figures for the six months
to 30 June 1999 and the 12 months to 31 December 1999.
  
                                          £m                         Rm
                         6       6   Year to         6       6  Year to
                    months  months        31    months  months       31
                     to 30   to 30   December     to 30   to 30 December
                      June    June     1999      June    June    1999
                      2000    1999                2000    1999
Embedded value at   5,214   4,692   5,414      53,583  44,600  53,794
end of period
Embedded value at                                              
beginning of        5,414   3,086   3,086      53,794  30,174  30,174
period
Increase in         (200)   1,606   2,328      (211)   14,426  23,620
embedded value
Less capital        -       404     963        -       3,954   9,309
raised
Self-investment     -       404     404        -       3,954   3,954
transaction
Capital raised at   -       -       559        -       -       5,355
listing
Plus dividends      55      -       69         569     -       680
proposed
                                                               
Embedded value      (145)   1,202   1,434      358     10,472  14,991
profits

  The components of the embedded value profits are set out below:
                                          £m                         Rm
                         6       6   Year to         6       6  Year to
                    months  months        31    months  months       31
                     to 30   to 30   December     to 30   to 30  December
                      June    June     1999       June    June    1999
                      2000    1999                2000    1999
Profit from new     26      13      75          272     132     741
business
Point of sale       25      13      69          259     124     678
Expected return to  1       -       6           13      8       63
end of period
Expected return     70      70      160         728     688     1,581
Experience          27      3       13          280     32      129
variances
Profit before       123     86      248         1,280   852     2,451
investment effects
and non-operating
items
Investment          (22)    90      99          (228)   880     972
variances
Investment return   (38)    942     1,331       (388)   9,262   13,118
on adjusted net
worth
Impact of 2000 SA   -       -       (121)       -       -       (1,190)
tax change
Non-operating       -       (52)    (64)        -       (516)   (636)
items
Sale of OMLA        -       -       (12)        -       -       (118)
Additional                                                      
pensions
mis-selling         -       (52)    (52)        -       (516)   (518)
provisions
Exchange rate       (208)   136     (59)        (306)   (6)     276
movements
                                                                
Embedded value      (145)   1,202   1,434       358     10,472  14,991
profits
                                   
                            OLD MUTUAL PLC
                  Embedded value information (cont'd)
Profits  from  new life assurance business comprise the  value  of  new
business  written during the period, determined initially at the  point
of  sale and then accumulated to the end of the period by applying  the
discount  rate to the value of new business at the point  of  sale  and
adding back the expected cost of solvency capital between the point  of
sale  and  the  end of the period.  New business profits  for  the  six
months ended 30 June 1999 and the year ended 31 December 1999 are based
on the South African tax basis that applied up to 31 December 1999, and
are  therefore not directly comparable to the corresponding figures for
the  six  months to 30 June 2000.  New business profits  for  the  year
ended  31  December  1999 restated on the new tax  basis  (effective  1
January 2000) are set out in section 3 below.

Profits  from existing life assurance business consist  of  the
expected return on the in-force business and experience variances.  The
expected  return  is determined by applying the discount  rate  to  the
value  of  in-force business at the beginning of the period and  adding
back the expected cost of solvency capital over the period.  Experience
variances  are  caused by differences between the actual experience  in
the  period and the assumption used to calculate the value at the start
of  the  period,  as  well as changes in assumptions  regarding  future
experience.

Investment variances represent the differences between the actual
returns  in the period and the assumptions used to calculate the  value
at  the start of the period, together with changes in future investment
return and discount rate assumptions.

Investment return on adjusted net worth represents  the  actual
investment  return  earned  on  the shareholder  portfolio  investments
(which  includes  the return on the market value of  the  shareholders'
investments in Nedcor, Mutual & Federal and Nedcor Investment Bank), as
well  as the profits arising from other non-life businesses within  the
group.

The basis of taxation of life assurance companies in South Africa
changed  with  effect  from 1 January 2000,  although  the  impact  was
included  in the value of in-force as at 31 December 1999.  The  result
for  the half year ended 30 June 2000 however do not include the impact
of  the proposed introduction of capital gains tax in South Africa with
effect from 1 April 2001.

3.    Value of new business
The  value of new business (VNB) written in the period  is  the
present  value of the projected stream of after-tax profits  from  that
business, adjusted for the cost of holding solvency capital.

The tables below set out a geographical analysis of the value of
new  business for the six months to 30 June 2000, six months to 30 June
1999 and the 12 months to 31 December 1999.  New business profitability
(as  measured  by  the  ratio  of the value  of  new  business  to  the
equivalent  annual premium) is also shown.  Equivalent  annual  premium
(EAP) is calculated as recurring premiums (RP) plus one tenth of single
premiums (SP).

                6 months to 30 June            6 months to 30 June 2000
                            2000 £m                                  Rm
                RP   SP   EAP  VNB*   Margin   RP     SP     EAP  VNB*
                                       
South Africa    86   564  142  23      16%     884   5,825  1,467 234
Individual      65   395  104  9       9%      670   4,075  1,078 91
Business
Group Business  21   169  38   14      37%     214   1,750  389   143
Rest of World   11   98   21   2       12%     113   1,014  214   25
Value at point  97   662  163  25      15%     997   6,839  1,681 259
of sale
Expected                                                          
return                         1                                  13
to end of
period
Value at  end                                                     
of period       97   662  163  26      16%     997   6,839  1,681 272

* Value of new business net of cost of solvency capital of £2m (R23m)

                6 months to 30 June             6 month to 30 June 2000
                            2000 £m                                  Rm
                RP   SP   EAP  VNB*   Margin     RP     SP    EAP   VNB*
                                       
South Africa    81   496  131   11     8%      794   4,877  1,282   106
Individual      74   370  111   5      4%      724   3,635  1,088   48
Business                                                    
Group Business   7   126  20    6      30%     70    1,242  194    58
Rest of World   11   96   21    2      9%      114    943   208    18
Value at point  92   592  152   13     8%      908   5,820  1,490   124
of sale                                                   
Expected                                                            
return                          -                                   8
to end of
period
Value at end    92   592  152   13     9%      908   5,820  1,490   132
of period                                                    

* Value of new business net cost of solvency capital of £2m (R15)
                           OLD MUTUAL PLC
                                  
                 Embedded value information (cont'd)

3.    Value of new business continued


                 12 months to 31 Dec             12 months to 31 Dec 1999
                             1999 £m                                   Rm
               RP    SP    EAP  VNB*    Margin   RP     SP    EAP   VNB*
                                        
South Africa   162  1,043 266   47      18%     1,597  10,280 2,625  467
                      
Individual                                                          
Business       141  697   211   25      12%     1,390  6,873  2,077  248
 (new tax                                       
basis)
Group                                                               
Business       21   346   55    22      40%     207   3,407  548    219
 (excl free
shares)
Rest of World  36   172   53    7       13%     355   1,696  525    67
Value at                                                            
point of sale  198  1,215 319   54      17%     1,952 11,976 3,150  534
 (adjusted)                                     
Expected                                                            
return to end                   6                                   63
of period
Adjusted       198  1,215 319   60      19%     1,952 11,976 3,150  597
value at end                               
of period
SA Individual                                                       
(tax change)                    8       -                           73
SA Group            175   18    7       41%            1,727  172   71
(free shares)
Value at end   198  1,390 337   75      22%     1,952  13,703 3,322 741
of period                                       

* Value of new business net of cost of solvency capital of £7m
(R65m)

The  tax  change in respect of individual business in  South  Africa
reflects  the impact of the new tax basis effective 1 January  2000.
The  value  of  new group business for the year to 31 December  1999
includes an amount of £7.2 million (R71 million) in respect  of  the
proceeds   of   free   shares  issued   to   retirement   funds   at
demutualisation, and re-invested with Old Mutual.

The  value of new business excludes the value of new individual unit
trust  and  some group market-linked business written  by  the  life
companies,  as  the  profits on this business  arise  in  the  asset
management subsidiaries. It also excludes premium increases  arising
from  indexation  arrangements in respect of existing  business,  as
these  are  already included in the value of in-force business.  The
value  of  new business however includes the value of new Investment
Frontiers  business  that  originated from  existing  policies  that
matured. A reconciliation of the new business premiums show in  note
6(b)  to  the financial statements to those shown above is  set  out
below.

                                                   £m                   Rm
                                    Recurring   Single    Recurring    Single
                                    premiums   premiums  premiums     premiums
       
                                                               
New business premiums in note      120       803        1,238         8,299
6(b) to the
 financial statements
Less:                                                             
- Group market-linked business     (1)       (130)      (12)         (1,348)
not valued
- Unit trust business not valued   -         (68)       -              (703)
- New business premiums arising    (22)      -          (229)            -
from indexation
Plus transfer of maturing          -         57         -               591
policies to Investment Frontiers
New business premiums on           97        662        997           6,839
embedded value basis

The assumptions used to calculate the value of new business are set
out in section 4.
                                  
                           OLD MUTUAL PLC
                 Embedded value information (cont'd)

4.      Assumptions
 The principal assumptions used in the calculation of the value of in-
   force business and the value of new business are
 set out below.

* The pre-tax investment and economic assumptions used for South
  African business were as follows:

South Africa                        30 June    31 December    30 June
                                       2000           1999       1999
Fixed Interest Return              14.5%             14.0%   15.5%
Equity & Property Return           17.5%             17.0%   18.5%
Inflation                          10.5%             10.0%   11.5%
Risk Discount Rate                 18.5%             18.0%   19.5%

For the non-South African operations, appropriate investment and
economic assumptions were chosen on bases consistent with those
adopted in South Africa.

* Rates  of  future  bonuses have been set at levels consistent  with
  investment return assumptions.

* For  in-force business, projected company taxation is based on  the
  new  tax  basis  that applies to South African life  assurers,  and
  includes   full  allowance  for  secondary  taxation  on  companies
  payable  in  South Africa.  No account has been taken  of  possible
  capital gains tax that may be payable in future.

* The    assumed   future   mortality,   morbidity   and    voluntary
  discontinuance  rates   have  been based  as  far  as  possible  on
  analyses  of recent operating experience.  Allowance has been  made
  where appropriate for the effect of expected AIDS-related claims.

* Management  expenses attributable to life assurance  business  have
  been  split   between expenses relating to the acquisition  of  new
  business and the maintenance of business in force.  Assumed  future
  expenses  were  based  on  levels  as  at  31  December  1999,  and
  projected forward with expense inflation to 30 June 2000.   Expense
  savings  arising  from Project 500 that have  occurred  during  the
  period  have therefore not been taken into account - these will  be
  reflected  in the next valuation in December.  The future  expenses
  attributable  to  life  insurance business  do  not  include  group
  expenses incurred at the holding company level.

* Future  investment  expenses were based on the  current  scales  of
  fees  payable   by  the  life  insurance  companies  to  the  asset
  management  subsidiaries. To the extent  that  these  fees  include
  profit  margins  for  the  asset  management  subsidiaries,   these
  margins  have  not been included in the value of in-force  business
  or the value of new business.

* The  effect  of increases in premiums over the period for  policies
  in-force  as   at  30  June  2000 and 31  December  1999  has  been
  included  in  the  value  of  in-force  business  only  where  such
  increases  are  associated  with  indexation  arrangements.   Other
  increases  in  premiums of existing policies are  included  in  the
  value of new business.

* Conversions  between  Rand and Sterling were  carried  out  at  the
  following rates:

Exchange rates         Rand per Sterling
At 30 June 2000                 10.2767
At 31 December 1999             9.9364
6 months to 30 June 2000        10.3330
(average)
6 months to 30 June 1999        9.8305
(average)
12 months to 31 December 1999   9.8588
(average)

                           OLD MUTUAL PLC
                 Embedded value information (cont'd)


5.     Alternative assumptions
The  discount  rate  appropriate to an investor will  depend  on  the
investor's own requirements, tax position and perception of the risks
associated  with the realisation of the future profits. To illustrate
the  effect of using different discount rates, the table below  shows
the  embedded value of Old Mutual plc at 30 June 2000 at  alternative
discount  rates.  In  determining the values  at  different  discount
rates, all other assumptions have been left unchanged.
   
                                        £m                           Rm
                   Value   Value  Value at      Value    Value    Value
                      at      at                   at       at       at
                  Central  Central  Central    Central  Central  Central
                 Discount Discount   Discoun  Discount  Discount Discount     
            
                  Rate -1%    Rate  Rate +1%  Rate -1%  Rate    Rate +1%
Adjusted net     4,450   4,450    4,450       45,737   45,737  45,737
worth
Value of in-     882     764      658         9,072    7,846   6,763
force business
Value before     883     840      800         9,082    8,628   8,224
costs of
capital
Cost of          (1)     (76)     (142)       (10)     (782)   (1,461)
solvency
capital
                                                               
Embedded value   5,332   5,214    5,108       54,809   53,583  52,500

The table below sets out the value of new life assurance business for
the six months to 30 June 2000 at alternative discount rates.

                                       £m                            Rm
                   Value   Value    Value      Value    Value     Value
                      at      at       at         at       at        at
                  Central Central Central    Central  Central   Central
                 Discount Discount Discount  Discount Discount  Discount
               
                Rate -1%    Rate   Rate +1%  Rate -1%   Rate    Rate+1%
Value before     29      27       25         304     282       261
cost of capital
Cost of          -       (2)      (4)        -       (23)      (43)
solvency
capital
Value of new                                                   
business at      29      25       21         304     259       218
point of sale


6.        External review
   The  Group's embedded value results have been reviewed  by
   Tillinghast-Towers  Perrin  who have confirmed  to  the  Directors
   that  the  methodology  and  assumptions  used  to  determine  the
   embedded value are reasonable and that the embedded value  profits
   are  reasonable  in the context of the operating  performance  and
   experience of the insurance business during the six months  to  30
   June 2000.