Generali establishes $12 million Holocaust Fund; Sets up survivors' information center.

TRIESTE, Italy--(BUSINESS WIRE)--June 17, 1997--Assicurazioni Generali S.p.A. (MIB:G) today announced the establishment of a $12 million fund to honor the victims of the Holocaust and to perpetuate their memory.

The fund is intended to support not only existing institutions but also cultural and charitable activities. It will be administered by a committee on which Generali will be represented. At the same time, the company confirmed that they are setting up a survivors' information center to serve the heirs of policyholders and creating a computerized, state-of-the-art legacy archive based upon historical documents in Generali's possession. Generali has announced that it will make access available to institutions like Yad Vashem and the United States Holocaust Memorial Museum and similar entities.

Giving details of these measures, Gianfranco Gutty, vice-president and managing director, said, "The creation of this fund is a real affirmation of the strong ties that Generali has to the Jewish community at large, and to Israel in particular. Furthermore, the survivors' information center and the legacy archive will provide a tremendous resource for many people. Policyholders, or their heirs, will now have a dedicated documentary facility through which they can research relationships to Generali. The archive also will provide valuable insights into the communities who were insured by the company. It might enable survivors or descendants to track relatives and, in perhaps rescuing the identities of some from the devastation they suffered, it might help further to establish the true scope of the Holocaust."

Generali's announcement comes just days before the visit to Israel of the company's president, Antoine Bernheim, who will be accompanied by Gutty.

"Generali has a long history of close ties to Israel -- religious ties, through our Jewish heritage, and commercial ties, through Migdal, our insurance company there. For me personally, this visit will be very emotional," commented Bernheim, himself a survivor of Auschwitz.

As regards certain litigation in the United States, Generali has agreed to a voluntary stipulation with the plaintiffs that both sides will preserve all evidence in this case. Generali further agreed to provide to plaintiffs counsel, on a priority basis, background information on the company, its subsidiaries, corporate structure and history, as well public information.

M. Scott Vayer, co-counsel, for Generali, stated that "A fair examination of the record shows that Generali has fulfilled its legal obligations. The company's announcement today to establish a memorial fund, a survivors' information center, and a legacy archive documenting its long relationship with the Jewish community, is an expression of Generali's deep respect for those who suffered in the Holocaust."

Background

Assicurazioni Generali has a long Jewish tradition which found expression most recently in its $320 million investment to acquire a majority position in the Israeli insurance firm Migdal - a strong expression of faith in the future of Israel. Generali was founded by Jewish merchants from the Veneto and Trieste in 1831, and it has been headquartered in Trieste ever since. During the first months of 1832, it opened offices in the other major cities of the Hapsburg Empire, contributing enormously over the years to the spirit of individual responsibility in Central and Eastern Europe. Following the split-up of the Hapsburg Empire at the end of World War I, Generali continued its leading role in the insurance industry in the countries which emerged from the former Empire.

After World War II and the Holocaust, the Soviet-dominated countries that went communist nationalized all their major businesses. Generali was among those international companies whose total East European businesses were taken. Besides its own branches, Generali also lost 14 other companies it controlled and extensive property comprising 184 buildings in principal cities. In expropriating and nationalizing the company's assets, the communist states of Eastern Europe assumed all of Generali's liabilities in these countries. Persons claiming under policies issued by Generali in those countries had to apply to the successor companies or authorities in those countries, in whom all the assets relating to such insurance obligations had been vested as a matter of local law. But where the company retained its liabilities, it honored all valid claims presented. This applied to the whole of Western Europe.

Certain erroneous statements have been made respecting policies made in Czechoslovakia, so Generali's position via-a-vis that country demands more detailed comment.

Following the war, all insurance activities in Czechoslovakia were nationalized by Presidential Decree No. 103 of 24 October, 1945 (Enc. 1). By virtue of this, all of Generali's obligations were vested in a Czech state company, Ceskoslovenska Pojistovna. As a consequence, policies issued by Generali in Czechoslovakia were no longer obligations of Generali, but of the successor Czech company. An official declaration -- dated 8 March, 1950 (Enc. 2) and sanctioned by the Czech Ministry of Finance, which functioned as the controlling body for insurance activities -- states explicitly that the insured of Generali must look to the state company as the legal successor of Generali for all purposes.

Questions have been raised about the amount and purpose of compensation paid by the Czech government to the Italian government following the Czechoslovakian-Italian treaty of 1966. By this treaty, Italy was paid a total of Lire 2.6 billion as compensation for all Italian property, corporate or private, that was nationalized by Czechoslovakia. Generali received a small percentage of the value of its total Czech assets net of its total Czech liabilities (including policy liabilities). Generali received no compensation whatsoever for its assets in Czechoslovakia which secured policy liabilities.

In other words, Czechoslovakian organizations retained all the assets that covered Generali's Czechoslovakian liablities. Hence, the obligation to meet such liablities remains with those Czechoslovakian organizations and their successors.

Recently, Abraham Ravitz, president of the Israeli Knesset's powerful Finance Committee and a member of one of the governing coalition parties, stated that the issue will have to be brought before the International Court of Justice in The Hague if solution is not reached in a proceeding which must include the Czech Republic. Generali welcomes Ravitz's statement as an acknowledgement that Generali has no legal responsibility in this matter and that the countries who nationalized Generali's properties without regard for policyholders' rights must be held responsible for these wrongs against the insured so long unredressed. Generali believes that this issue should indeed be pursued at the international level, so as to identify those who properly bear the financial responsibility to Holocaust victims and their heirs for insurance assets which were unfairly expropriated. -0-

Enc. 1

Types of nationalization Art. 10

1) The government will adopt measures necessary for regulating contractual (private) insurance in the territory of the Czechoslovak Republic pursuant to articles 3 through 9. It will act upon a proposal submitted by the Minister of Finance who will first hear the recommendations of the Council (in Slovakia in agreement with a pertinent delegate). This must be done as soon as possible, however, at the latest within one year; simultaneously, by means of objective concentration the number of institutions engaging in insurance activity shall be significantly decreased.

2) Concerning the regulation pursuant to paragraph 1 efficient and self-sufficient management units must be created, continuity must be maintained, and attention to the requirements of individual countries must be provided.

3) If cases pursuant to article 14, paragraph 2 are not involved, salaries of current employees and recipients of retirement and pension benefits to which they are entitled should not decrease.

4) Aside from the cases pursuant to paragraph 1 a new insurance company (national enterprise) may be established only by resolution of the government acting on a proposal submitted by the Minister of Finance acting at the recommendation of the Council (in Slovakia following an agreement with a pertinent delegate). The same is valid in the case of a merger or a dissolution of insurance companies.

Enc. 2

Statement

The undersigned Ceskoslovenska Pojistovna, narodni podnik, domiciled in Prague - I., Staromestske nam. 5-6 hereby certifies that based on the Decree issued by the President of the Republic on Oct. 24, 1945, Coll. No. 103 with regard to the nationalization of private insurance companies of the nationalized portfolio of the Prague Administration of the ASSICURAZIONI GENERALI Insurance Company of Trieste was assumed, with all of the rights and obligations derived therefrom, by virtue of the judgement of the Ministry of Finance of November 20, 1946, No. 2088 of the Official Gazette I and, by virtue of the judgement of the Ministry of Finance of May 25, 1948, No. 977 of the Official Gazette I., by CESKOSLOVENSKA POJISTOVNA, narodni podnik, Prague.

The policy holders of those having the rights awarded by the insurance treaty, may (illegible) value the rights and obligations derived from the national insurance portfolio of the Administration of (illegible) Prague of the ASSICURAZIONI GENERALI Insurance Company of Trieste (illegible) with regard to CESKOSLOVENSKA POJISTNOVA narodni podnik in Prague, with the absolute exclusion of Assicurazioni Generali of Trieste.

Prague, March 8, 1950.

CESKOSLOVENSKA

POJISTOVNA

NARODNI PODNIK

(signature illegible)

The Ministry of Finance certifies, within its role as the Supervising Authority of Czechoslovakian Insurance (illegible) that the above mentioned statement is in compliance with the jurisprudence currently in effect in the Republic of Czechoslovakia.

Prague, March 9, 1950

(seal)

MINISTRY OF FINANCE

(Illegible)

CONTACT: Rod Clayton, 212/445-8219