MLC – Capital International Global Share Fund March 09 Annual Commentary The MLC Capital International Global Share Fund aims to provide long term growth from an actively managed share portfolio selected from share markets around the world.

Quart 2 yrs 3 yrs 5 yrs 1 yr MANAGER er (%) (% (% (% (%) pa) pa) pa) Capital International – Global Strategy -9.1 -20.7 -16.0 -11.5 -0.4 MSCI World Index $AUD -11.5 -24.1 -19.2 -12.5 -1.2 NB. The performance reported in the above table is before fees and taxes.

Market Commentary Please find a summary below:  Global stocks declined over the quarter as a rally in March failed to reverse heavy losses suffered in the first two months of 2009. With governments forced into additional bank recapitalizations and public spending pledges, and central banks having to adopt largely untested credit-boosting measures, investors cut their exposure to risk. The US dollar retained its safe-heaven status, rising against most currencies worldwide.  US stocks dropped in the first quarter as the deepening recession claimed another 2 million jobs. The market sank for most of the period, and then rallied in March as the new Obama administration rolled out more detailed plans to save the banking industry, which included calls for large private investors to partner with the government to buy up to US$1 trillion in troubled loans and securities.  European stocks declined as the global economic slump deepened and the number of countries officially deemed to be in recession increased. Governments continued to bail out financial institutions and other industries, and turned to unconventional fiscal policy measures to stimulate economic activity. The ECB lowered its key interest rate to a record low of 1.5% while the BOE cut rates every month to reach a new low of 0.5%.  Despite rallying in March, Pacific stocks fell in the first quarter, due mainly to Japan’s decline amid a worsening economy, falling exports and political turmoil.  Financials was the worst-performing sector, followed by industrials and utilities. Information technology, materials and consumer discretionary stocks held up the best.  The portfolio’s health care and financials stocks were the strongest contributors to relative returns. Our holdings in materials and telecommunication services detracted value.

(All returns are quoted in Australian Dollars) Portfolio Commentary Markets fell during the first quarter whilst massive stimulus packages were being delivered by governments all around the world. Although there was some evidence in March that markets were starting to respond to various unprecedented monetary and fiscal policy actions, investors remained jittery. Amidst ongoing volatility, the global economy continued to slide towards recession. In response, the amount of planned fiscal stimulus reached an estimated USD$2.4 trillion, or 3% of global GDP. Locally the Australian dollar closed the quarter essentially flat, up only half of a percent to end the quarter at 69.5 US cents. The MSCI World Index was down 11.5% over the period. Against this backdrop the MLC Capital International Global Share Fund closed down 9.1%, outperforming the index by approximately 240 basis points. The key drivers of this outperformance were stock

1 MLC – Capital International Global Share Fund March 09 Annual Commentary selection in Health Care, Energy and the United States, along with underweight exposure to Financials. Hurting performance somewhat, was stock selection in Materials, Consumer Discretionary and Telecommunications Services.

Health Care The portfolio's health care stocks were strong positive contributors for the quarter - particularly within the Biotechnology and Pharmaceuticals sectors. Biotechnology company Genentech (US), returned 14.5% for the quarter after Roche raised its offer price for all outstanding publicly held shares in the Company. Pharmaceutical company Allergan (US) was also a strong performer for the quarter, up 19% based on speculation that the California-based wrinkle treatment company could be acquired by GlaxoSmithKline. Another significant Pharmaceutical holding within the portfolio - Roche (Switzerland) - ended the quarter basically flat, down just 1%, after a tumultuous quarter which saw the stock hit highs of over 177 Swiss Francs in January and lows of 130 in March.

Financials The Financials sector closed the quarter 22% lower. Accordingly, the portfolio's underweight exposure to the sector helped performance. Stock selection in Financials also helped portfolio returns with Goldman Sachs (US) up 26%. Norwegian Insurance group Storebrand was up 25% after Caranegie Investment Bank upgraged the stock, citing a possible takeover by Gjesidige Forsikring which currently owns 24 percent of the company. Performance was negatively impacted by QBE Insurance (Australia), which was down 23% for the quarter. Allianz (Germany) and Aviva (UK) were also down, returning -15% and -40% respectively, over the same period.

Energy In a reversal of it's recent drag on performance, Energy was a key contributor to portfolio returns this quarter with positive stock selection being a major factor. Norwegian Energy, Equipment and Services company Seadrill was up by 19% for the quarter. Suncor Energy (Canada), the second largest oilsands producer, returned a solid performance for the month, up 19%, benefiting from oil price movements. On the downside, US Oil & Gas holding, Delta Petroleum was down 75% for the quarter even though it took delivery of its new deepwater semi-submersible drilling rig West Eminence from the Samsung shipyard in South Korea.

Materials Overall, the portfolio's materials holdings detracted from performance for the March quarter. Construction materials holdings in particular suffered with Vulcan Materials (US), the largest US producer of crushed stone, falling 36% over the quarter as a result of drop-off in construction demand, whilst Holcim (Switzerland) was down 33% and Lafarge (France) down 22%. Swiss Chemicals company, Givaudan was down by 29% for the quarter. Mitigating this negative performance somewhat was US chemicals company Monsanto which returned 19% and Potashcorp (Canada) gained 14%.

2 MLC – Capital International Global Share Fund March 09 Annual Commentary

Consumer Discretionary The portfolio's consumer discretionary holdings produced mixed results. Whilst multiline retailer Target (US) was essentially flat over the quarter, Suzuki Motor Corp (Japan) provided solid returns, up 33%.Hong Kong based Distribution company Li & Fung also returned an impressive 37% over the same period. Media giants Walt Disney (US) and JC Decaux (France) retreated by 20% and 31% respectively, whilst Johnson Controls also fell 33%.

Disclaimer: Please note that all figures reported in this fund commentary are before management fees and taxes, unless otherwise mentioned. Any advice in this communication has been prepared without taking account of your objectives, financial situation or needs. Because of this you should, before acting on any advice in this communication, consider whether it is appropriate to your objectives, financial situation and needs. You should obtain a Product Disclosure Statement or other disclosure document relating to any financial product issued by MLC Investments Limited ABN 30 002 641 661 and MLC Limited ABN 90 000 000 402 and consider it before making any decision about whether to acquire or continue to hold the product. A copy of the Product Disclosure Statement or other disclosure document is available upon request by phoning the MLC call centre on 132 652 or on our website at www.mlc.com.au An investment in any product offered by a member company of the National group does not represent a deposit with or a liability of the National Australia Bank Limited ABN 12 004 044 937 or other member company of the National Australia Bank group of companies and is subject to investment risk including possible delays in repayment and loss or income and capital invested. None of the National Australia Bank Limited, MLC Limited, MLC Investments Limited or other member company in the National Australia Bank group of companies guarantees the capital value, payment of income or performance of any financial product referred to in this publication.

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