1

MLC Investments – Performance PreviewYear ended 30th June 2009

Michelle HeinrichHead of Investment Specialists & Div’d Strategies

John OwenSenior Investment Specialist for Aust’n Shares & Property

Kajanga KulatungaInvestment Specialist for Global Shares & Private Markets

Natalie CominoSenior Investment Specialist for Debt

Amanda HeyesInvestment SpecialistResearch & Analytics

DisclaimerThis information has been provided by MLC Limited (ABN 90 000 000 402) a member of the National Group, 105-153 Miller Street, North Sydney 2060. This material was prepared for advisers only.

MLC Investments Limited ABN 30 002 641 661 is the issuer of interests in each fund of the MLC MasterKey Unit Trust and MLC Nominees Pty Limited ABN 93 002 814 959 is the issuer of MLC MasterKey Superannuation and the MLC Allocated Pension. Information about the MLC MasterKey Horizon Series is available in the current Product Disclosure Statement (‘PDS’) or other disclosure document, copies of which are available upon request by phoning the MasterKey Service Centre on 133 433 or on our website at mlc.com.au. Persons should consider the relevant PDS in deciding whether to acquire, or to continue to hold, this product. Persons wishing to acquire an interest in this product must complete the application form attached to the relevant PDS.

Any advice in this communication has been prepared without taking account of individual objectives, financial situation or needs. Because of this you should, before acting on any information 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 Nominees Pty Ltd (ABN 93 002 814 959) as trustee of The Universal Super Scheme (ABN 44 928 361 101), 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 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.Past performance is not indicative of future performance. The value of an investment may rise or fall with the changes in the market. Please note that all return figures reported are before management fees and taxes, and for the period up to 30 June 2009, unless otherwise stated.

The specialist investment management companies are current as at 30 June 2009. Funds under management figures are as at 30 June 2009, unless otherwise stated. Investment managers are regularly reviewed and may be appointed or removed at any time without prior notice to you.

2

Contents

Slide no.• The recent environment 4• Impact on asset class returns 8• Impact on MLC multi-manager funds 10

– MLC Horizon 4 11– MLC Australian share strategies 16– MLC Property Strategies 24– MLC Global Strategies 31– MLC Diversified Debt strategies 35

• The outlook 41• Appendix 46

3

The Recent Environment: No-where to hide

Source: Thomson Financial.

US

-4

-2

0

2

4

6

Q1 1999 Q1 2002 Q1 2005 Q1 2008

Annual growth in real GDP %

Eurozone

-6-4-20246

Q1 1999 Q1 2002 Q1 2005 Q1 2008

Annual growth in real GDP %

Japan

-10

-5

0

5

Q1 1999 Q1 2002 Q1 2005 Q1 2008

Annual growth in real GDP %

UK

-6-4-20246

Q1 1999 Q1 2002 Q1 2005 Q1 2008

Annual growth in real GDP %

4

Major economies' manufacturing conditions

-4

-3

-2

-1

0

1

2

3

Q1 1995 Q1 1998 Q1 2001 Q1 2004 Q1 2007

US Europe Japan

Deviation from average

Major economies' consumer sentiment

-4

-3

-2

-1

0

1

2

3

Q1 1995 Q1 1998 Q1 2001 Q1 2004 Q1 2007

US Europe Japan

Deviation from average

Global Green shoots?

Source: Composite based on US ISM survey, Japanese Tankan survey and European commission on economic sentiment survey.5

Consumer Confidence

Source: WBC, Conference Board

AU WBC CONSUMER SENTIMENT INDEXUS CONSUMER CONFIDENCE: THE CONFERENCE BOARD'S IND (RHS)

09070503019997959492

125

100

75

150

125

100

75

50

25

Australian & US Employment

Source: ABS, BLS

AU EMPLOYED: PERSONS SADJ %yoy US PAYROLLS NON FARM %yoy

09070503019997959492908886848280

8

6

4

2

0

-2

-4

-6

Australian & US Housing Activity

Source: ABS, Census Bureau

Aust private sector dwelling approvals %yoyUS HOUSING STARTS %yoy

0907050301999795949290888684

75

60

45

30

15

0

-15

-30

-45

The lucky country!

Australian & US Business Conditions

Source: NAB, ISM

AU NAB Business Conditions US ISM MANUFACTURERS SURVEY : INDEX (RHS)

09070503019997959492908886

30

20

10

0

-10

-20

-30

-40

65

60

55

50

45

40

35

30

25

6

Credit markets have gone a long way towards reversing their post-Lehman losses

Barclays high yield spread over Treasuries

0

500

1000

1500

2000

2500

Jun-87 Jun-90 Jun-93 Jun-96 Jun-99 Jun-02 Jun-05 Jun-08

Basis points

Spreads on investment grade debt are still historically wide

-100

0

100

200

300

400

500

600

700

Jun-79 Jun-84 Jun-89 Jun-94 Jun-99 Jun-04 Jun-09

Baa rated corporates

Aaa rated corporates

Basis points

7

Contents

Slide no.• The recent environment 4• Impact on asset class returns 8• Impact on MLC multi-manager funds 10

– MLC Horizon 4 11– MLC Australian share strategies 16– MLC Property Strategies 24– MLC Global Strategies 31– MLC Diversified Debt strategies 35

• The outlook 41• Appendix 46

8

Annualised Returns to 30 June 2009

-50%

-40%

-30%

-20%

-10%

0%

10%

20%

30%

An

nual

ise

d R

etur

ns (

%pa

)

3-Months

1 Year

5 Yr

Impact on investment market returns

Source: MLC Investment Management. Index Returns

9

Contents

Slide no.• The recent environment 4• Impact on asset class returns 8• Impact on MLC multi-manager funds 10

– MLC Horizon 4 11– MLC Australian share strategies 16– MLC Property Strategies 24– MLC Global Strategies 31– MLC Diversified Debt strategies 35

• The outlook 41• Appendix 46

10

MLC MK Super Fundamentals: Horizon & LTAR Returns* to 30th June 2009

-40%

-30%

-20%

-10%

0%

10%

20%

MLC Bondfund (100% D)

MLC CapStable fund

(70/30)

MLC ConsGrowth fund

(50/50)

MLCBalanced

fund (30/70)

MLC Growthfund(15/85)

MLC Sharefund (100% G)

MLC Accel.Growth fund

(130% G)

MLC LTAR

10 year 5 year 1 Year 3 month

•3 month & 1 year returns are MLC Super Fundamentals Super, 5 & 10 year returns are MLC Gold Star Super, both are net of fees & taxes. MLC Super Gold Star fees for H1 –H7 range from 1.91% - 2.48% LTAR is 2.76%, including adviser trail.

11

-27.0%

-18.0%

-9.0%

0.0%

9.0%

18.0%

27.0%

Mar 1988 Oct 1989 May 1991 Dec 1992 Jul 1994 Feb 1996 Sep 1997 Apr 1999 Nov 2000 Jun 2002 Jan 2004 Aug 2005 Mar 2007 Oct 2008

Ret

urn

(%

pa

)

12 Month Rolling Return 3 Year Rolling Return 5 Year Rolling Return

Return in Personal Super Multi-Sector Balanced Growth from Mar 1988 to May 2009MLC0424AU (after tax and after fees)

MLC MK Sup GS - Horizon 4 Balanced

Data Source: Morningstar

MLC Horizon 4 - Consistent added value across market cycles

Horizon 4’s 5 year return has not dipped below 0% in the past. Losses over 1 year periods occur with almost boring regularity.

The rally in risky assets of CYTD2009 is reflected in the up tick in total returns on the RHS.

Source: Mercers Retail Balanced Growth Universe, net of super tax and Gold star fees. Mercer data updated around the 20th day after month end.

12

Net* performance of MLC Horizon 4 (Super): Rolling 1, 3 & 5 Year Relative Returns

-5.0%

-4.0%

-3.0%

-2.0%

-1.0%

0.0%

1.0%

2.0%

3.0%

4.0%

5.0%

Apr 1991 Aug 1992 Dec 1993 Apr 1995 Aug 1996 Dec 1997 Apr 1999 Aug 2000 Dec 2001 Apr 2003 Aug 2004 Dec 2005 Apr 2007 Aug 2008

Ex

cess

Ret

urn

(%pa

)

12 Month Rolling Excess Return 3 Year Rolling Excess Return 5 Year Rolling Excess Return

Excess Return in Personal Super Multi-Sector Balanced Growth from Apr 1991 to May 2009MLC0424AU versus Median (after tax and after fees)

MLC MK Sup GS - Horizon 4 Balanced

Data Source: Morningstar

% of time outperformed competitors:1 year: 58%3 years: 63%5 years: 78%

Source: Mercers Retail Balanced Growth Universe, net of super tax and Gold star fees. Mercer data updated around the 20th day after month end.

13

MLC Super Horizon 4: Absolute Volatility Standard Deviation (5 year rolling)

4.0%

5.5%

7.0%

8.5%

10.0%

11.5%

13.0%

Mar 1992 Jun 1993 Sep 1994 Dec 1995 Mar 1997 Jun 1998 Sep 1999 Dec 2000 Mar 2002 Jun 2003 Sep 2004 Dec 2005 Mar 2007 Jun 2008

Stan

dard

Dev

iati

on (%

pa)

5 Year Rolling Standard Deviation Median Upper Quartile Lower Quartile

Standard Deviation in Personal Super Multi-Sector Balanced Growth from Mar 1992 to May 2009MLC0424AU (after tax and after fees)

MLC MK Sup GS - Horizon 4 Balanced

Data Source: Morningstar

62% below median

Source: Mercers Retail Balanced Growth Universe, net of super tax and Gold star fees. Mercer data updated around the 20th day after month end.

14

MLC Super LTAR performanceMK Super LTAR net real returns to 30 June 2009 for different period lengths

-60.0%

-40.0%

-20.0%

0.0%

20.0%

40.0%

60.0%

80.0%

100.0%

0 5 10 15 20 25 30 35 40 45 50

Period length in months

Cum

ulat

ive

net r

eal r

etur

n

95th percentile 75th percentile Median 25th percentile 5th percentile LTAR Cum.

Source: MLC Investment Management

15

Contents

Slide no.• The recent environment 4• Impact on asset class returns 8• Impact on MLC multi-manager funds 10

– MLC Horizon 4 11– MLC Australian share strategies 16– MLC Property Strategies 24– MLC Global Strategies 31– MLC Diversified Debt strategies 35

• The outlook 41• Appendix 46

16

Australian Shares: Market/Sector Update year ending June

-45

-40

-35

-30

-25

-20

-15

-10

-5

0

5

Info

Tec

h

Hea

lthca

re

Con

sum

erS

tapl

es

Fin

-x-P

rop

Fin

anci

als

Tel

ecom

s

Con

sum

erD

iscr

etio

nary

Util

ities

S&

P A

SX

300

Ene

rgy

Indu

stria

l

Mat

eria

ls

A-R

eit

%

-40%

-20%

0%

20%

40%

60%

80%

1980

1981

1982

1983

1984

1985

1986

1987

1988

1989

1990

1991

1992

1993

1994

1995

1996

1997

1998

1999

2000

2001

2002

2003

2004

2005

2006

2007

2008

2009

Financial Year Ending

17

MLC Australian Shares: Strategy (top) and Manager (bottom) Update

-4 -2 0 2 4 6 8 10 12

Dimensional

Lazard

Maple-Brown Abbott

Balanced Equity

Contango

Concord

J ardine

Wallara

Northcape

Northward Capital

Rolling 1 Year Australian Equity Manager Excess Returns

-15.0%

-10.0%

-5.0%

0.0%

5.0%

10.0%

15.0%

Total

Source: MLC Investment Management. Before the deduction of fees & taxes.

Manager specific excess return for year ended 30 June 2009

18

Australian Shares Stock Story: Wesfarmers share placement (Using market opportunities to the advantage of clients)

January2009

February March April May June July

WES.ASX: 22.9

15

15.5

16

16.5

17

17.5

18

18.5

19

19.5

20

20.5

21

21.5

22

22.5

23

23.5

24

Shares placed at $13.50 p.s. on 22 January

Shares listed on 4 March

Current share price $22.87

Source: IRESS

19

MLC IncomeBuilder’s Primary objective: Increasing income stream with tax advantages

Source: MLC investment Management, for MLC Unit Trust IncomeBuilder.

1.86 2.46 2.23 2.73 3.04 2.83 2.984.24 4.87

6.74 7.64 8.21 8.71 8.97

1.68

3.59

5.34

0.43

0.35

1.310.99

0.02

0.35

0.08

0

2

4

6

8

10

12

14

1996

1997

1998

1999

2000

2001

2002

2003

2004

2005

2006

2007

2008

2009

Financial Year End 30 J une

Cen

ts P

er S

hare

Income Buy Backs Total Capital Gains

20

MLC IncomeBuilder: Market/Sector Update: Sector Returns (%) to 30 June 2009

-45

-40

-35

-30

-25

-20

-15

-10

-5

0

5

Info

Te

ch

He

alt

hc

are

Co

nsu

me

r

Sta

ple

s

Fin

-x-P

rop

Fin

an

cia

ls

Te

lec

om

s

S&

P A

SX

20

0

Ind

Co

nsu

me

r

Dis

cre

tio

na

ry

Uti

liti

es

S&

P A

SX

30

0

En

erg

y

Ind

ustr

ial

Ma

teri

als

A-R

eit

Source: IRESS

21

MLC IncomeBuilder Stock Story: BlueScope Steel share placement (Using market opportunities to the advantage of clients)

J2002

O J2003

A J O J2004

A J O J2005

A J O J2006

A J O J2007

A J O J2008

A J O J2009

A J

BSL.ASX: 2.28

1.6

2

2.4

2.8

3.2

3.6

4

4.4

4.8

5.2

5.6

6

6.4

6.8

7.2

7.6

8

8.4

8.8

9.2

9.6

10

MLC IncomeBuilder’s managers participatedIn Bluescope Steel’s capital raising at a price of $1.55 per share, an all time low since the Company listed in July 2002

Source:IRESS22

Contents

Slide no.• The recent environment 4• Impact on asset class returns 8• Impact on MLC multi-manager funds 10

– MLC Horizon 4 11– MLC Australian share strategies 16– MLC Property Strategies 24– MLC Global Strategies 31– MLC Diversified Debt strategies 35

• The outlook 41• Appendix 46

23

Australian Real Estate Investment Trusts (AREITs): Market Update (10 years to 30 June 09)

99 002000

01 02 03 04 052005

06 07 08 09

XPJAI.ASX: 15132.531

10000

12000

14000

16000

18000

20000

22000

24000

26000

28000

30000

32000

34000

36000

38000

40000

42000

44000

46000

The sector has recently recoveredfrom historic lows

Source: IRESS, S&P/ASX200 Accumulation Index.24

MLC AREIT: Strategy (top, rolling 1 year) and Manager (bottom, year to 30 June 2009) Excess returns

0 2 4 6 8 10 12

Resolution

Capital

Challenger

Rolling 1 Year Listed Property Manager Excess Returns

-10.00%

-8.00%

-6.00%

-4.00%

-2.00%

0.00%

2.00%

4.00%

6.00%

8.00%

10.00%

Total

Source: MLC Investment Management. Before the deduction of fees & taxes.

Manager specific excess return for year ended 30 June 2009

25

MLC AREIT Stock Story: CFS Retail Property TrustPrice of CFS Retail vs AREIT Index

• Approx. 6.4% of the total MLC Property Securities Fund.

• Second strongest performer in the AREIT sector YTD (-11%) and significant outperformer vs index

• Opportunistic $325 million equity raising in October ’08 underpins financial position

• Modest borrowings (25.6% gearing) positions the Trust well financially versus many other AREITs

• Quality Australian based retial shopping centre portfolio

• One of few REITs not to slash distributions (so far)

Jul2008

Aug Sep Oct Nov Dec Jan2009

Feb Mar Apr May Jun Jul

CFX.ASX / XPJ.ASX: 0.0023

0.00140.00140.00150.00150.00160.00160.00170.00170.00180.00180.00190.00190.0020.0020.00210.00210.00220.00220.00230.00240.00240.00250.00250.00260.00260.00270.00270.00280.00280.00290.00290.003

Source: IRESS26

Global Real Estate Investment Trusts (GREITs) Market Update (to 30 June)

-50-40-30-20-10

010203040

3 Month (%) 1 Year (%)

Global

Singapore

Australia

Japan

Hong Kong

UK

Europe ex UK

USA and Canada

S&P / UBS Global Investors Accumulation Index: 30 June 2009

Source: Resolution Capital27

MLC GREIT: Strategy (top, rolling 1 year) and Manager (bottom, year to 30 June 2009) Excess returns

Rolling 1 Year - Global Listed Property Manager Excess Returns

-15.00%

-10.00%

-5.00%

0.00%

5.00%

10.00%

15.00%

MLC (Un)

-7 -5 -3 -1 1 3 5 7 9 11 13 15 17 19 21 23 25

LaSalle

Morgan Stanley

Resolution

Capital

Source: MLC Investment Management. Before the deduction of fees & taxes. Note: Morgan Stanley’s excess return is based on soft close preliminary data.

Manager specific excess return for year ended 30 June 2009

28

MLC GREIT Stock Story: Unibail (France)

Source: Resolution Capital

29

MLC GREIT Stock Story: DuPont Fabros (USA)

Source: Resolution Capital

30

Contents

Slide no.• The recent environment 4• Impact on asset class returns 8• Impact on MLC multi-manager funds 10

– MLC Horizon 4 11– MLC Australian share strategies 16– MLC Property Strategies 24– MLC Global Strategies 31– MLC Diversified Debt strategies 35

• The outlook 41• Appendix 46

31

MLC Global share fund update – reversal of returnsExcess Return vs. MSCI All Country Word Index (Unhedged) - July 1, 2008 to March 9, 2009

-15.0%

-10.0%

-5.0%

0.0%

5.0%

10.0%

15.0%

20.0%

En

erg

y

Ma

teria

ls

Ind

ustr

ials

Co

nsu

me

r

Dis

creti

on

ary

Co

nsu

me

r S

tap

les

Healt

h C

are

Fin

an

cia

ls

Info

rm

ati

on

Tech

no

log

y

Tele

co

mm

un

icati

on

Serv

ices

Uti

liti

es

Excess Return vs. MSCI All Country Word Index (Unhedged) - March 10, 2009 to June 30, 2009

-20.0%

-15.0%

-10.0%

-5.0%

0.0%

5.0%

10.0%

15.0%

20.0%

25.0%

30.0%

En

erg

y

Mate

ria

ls

Ind

ustr

ials

Co

nsu

mer

Dis

creti

on

ary

Co

nsu

mer S

tap

les

He

alt

h C

are

Fin

an

cia

ls

Info

rm

ati

on

Tech

no

log

y

Tele

co

mm

un

icati

on

Serv

ices

Uti

liti

es

Data source: Capital International, analysis MLC Investment Management32

Impact of style – Global Growth vs. Value?

Source: State Street Global Markets, Quantitative Strategy Monthly, June 2009

Some companies you own!

33

MLC Global private markets update

Vintage Year Commitments

All Data as at 31 May 200934

Contents

Slide no.• The recent environment 4• Impact on asset class returns 8• Impact on MLC multi-manager funds 10

– MLC Horizon 4 11– MLC Australian share strategies 16– MLC Property Strategies 24– MLC Global Strategies 31– MLC Diversified Debt strategies 35

• The outlook 41• Appendix 46

35

MLC’s Diversified Debt Fund and Horizon 1 – Bond Portfolio UpdateMarket update • Anticipation of an economic recovery has started to feed into the debt market which has

improved liquidity over the last quarter. • Money is now flowing from the “safe haven” of government debt, into higher credit risk markets.

That’s why 3 mth returns are so high but 1 and 3 year are still poor – they still have a way to go to recover the losses after Lehman Brothers’ collapsed in September 2008.

• Yields on inflation linked securities have risen because the market expects the government to increase issuance (supply) of these securities, pushing prices down and yields up.

Source: MLC Investment Management36

MLC Diversified Debt Fund UpdateStrategy update• We are seeing a reversal in the ground we lost in the few months after

Lehman Brother’s collapsed. • MLC’s position relative to peers and the market that hurt performance after

Lehman’s collapsed, are now helping returns - overweight to credit risk (and underweight to government securities) and overweight to global nominal bonds (and underweight to Australian)

• Overweight exposure to inflation linked securities, which helped returns in the “flight to quality” after Lehman’s collapse, has hurt returns in recent months.

37

MLC Diversified Debt Fund UpdateHigh yield bond story – Texas Competitive Electric Holdings

Company LLC (TCEH)• TCEH is a successful power producer. It is the 2nd largest

deregulated power generator in the US and the largest retail electricity provider in Texas. It has relatively steady operating cash flow due mostly to the consistent demand for power in Texas where it’s generating facilities are located. It also has no significant debt maturities in the next few years.

• But because of the forced selling of high yield securities following Lehman Brothers’ collapse, the price of the bond in MLC’s portfolio fell sharply and yields rose.

• WR Huff continued to believe the bond was “money good” and TCEH continued to operate as normal and honour interest payments. TCEH bond's market price vs interest coverage (EBITDA/Interest)

1.00x

1.20x

1.40x

1.60x

1.80x

2.00x

Dec'07 Mar'08 Jun'08 Sep'08 Dec'08 Mar'09 Jun'09 Sep'09 Est. Dec'09 Est. Mar'10 Est.

Inte

res

t c

ov

era

ge

50

55

60

65

70

75

80

85

90

95

100

Bo

nd

ma

rke

t p

ric

e

Interest Coverage 10.25% '15 Bond Price

38

MLC Horizon 1 – Bond Portfolio UpdateStrategy update – at last the low risk portfolio has come into its own!• Because the Portfolio is designed to provide capital preservation it has been well insulated from

credit market gyrations over the past year. The portfolio has achieved a consistently solid positive annual return.

• Some exposure to the credit market has helped to boost returns recently but is really just recovering lost returns post Lehman Brothers’ collapse.

• Exposure to inflation linked securities, which helped returns in the “flight to quality” after Lehman’s collapse, has hurt returns in recent months.

• Cash was one of the better performing types of debt this past year. Now that the official cash rate has remained at 3% since beginning of April, prospective returns are not great. That’s why the cash exposure is a focal point for the debt review, underway at present.

• This last year, the benefits of a diversified debt portfolio have been evident.

39

MLC Horizon 1 – Bond Portfolio Update

Strategy story• Horizon 1 investors experienced capital preservation despite gyrations in

most debt markets over the past year. That’s because more than 70% is invested in our lowest risk debt strategies (circled).

40

Contents

Slide no.• The recent environment 4• Impact on asset class returns 8• Impact on MLC multi-manager funds 10

– MLC Horizon 4 11– MLC Australian share strategies 16– MLC Property Strategies 24– MLC Global Strategies 31– MLC Diversified Debt strategies 35

• The outlook 41• Appendix 46

41

42

MLC Horizon Return Potential*: as at July 2007 & January 2009

Prospective Return Frontiers (10 year time horizon, post fees, alpha and tax)

30/70

50/50

70/3085/15

130/0

30/70 50/50 70/30 85/15 100/0 130/00%

2%

4%

6%

8%

10%

12%

Equity-Debt Mix

Real

Ret

urn

(% p

er a

nnum

)

Mean-variance base Scenario

Probability Weighted Scenario July 2007

Probability Weighted Scenario Jan 2009 (constant scenario probabilities)

Probability Weighted Scenario Jan 2009 (revised scenario probabilities)

Source: MLC Investment Management, * starting valuations as at July 2007 and January 2009.

ML

C H

ori

zon

3

ML

C H

ori

zon

2

ML

C H

ori

zon

4

ML

C H

ori

zon

5

ML

C H

ori

zon

6

ML

C H

ori

zon

7

42

Asset Class Return Potential as at end June 2009*

Source: MLC Investment Management, *Starting valuations as at end June 2009.

SAA Scenario Probability Weighted Real Returns

-10%

-5%

0%

5%

10%

15%

20%

DomesticEquity

Global equityUnhedged

Global equityHedged

Emergingmarkets equity

Unhedged

Domestic cash Short durationDiversified

Debt

All maturitiesDiversified

Debt

Domesticnominal

government

Domesticnominal

corporate

Global nominalgovernment

Global nominalcorporate

Domesticinflation linked

Global highyield debt

Insurancerelated debt

Ret

urn

% p

.a.

Probability Weighted

Mean in 10% positive tail

Mean in 10% negative tail

Long term 'normal' return

(7 years, 0% tax, pre fees, pre alpha)

43

MLC Diversified Fund Return Potential as end June 2009*

Source: MLC Investment Management, *Starting valuations as at end June 2009.

SAA Scenario Probability Weighted Real Returns (7 years, post tax, fees and MLC alpha)

-10%

-5%

0%

5%

10%

15%

20%

Horizon 1 Horizon 2 Horizon 3 Horizon 4 Horizon 5 Horizon 6 Horizon 7 LTAR Neutral LTAR CurrentStrategy

Ret

urn

% p

.a.

-10%

-5%

0%

5%

10%

15%

20%Probability Weighted Scenario Return

Mean in 10% positive tail

Mean in 10% negative tail

Long Term 'Normal' Return

44

The Outlook

• Global leading indicators, (consumer and business sentiment, and sharemarkets) are telling us economic recovery is starting despite lagging indicators (GDP, unemployment) still weakening

• The recovery seems likely to be VERY subdued – consumers (especially in the English speaking world) will take time to repair balance sheets and re-build savings

• Inflation whilst not a short term risk remains a medium term risk

• Emerging nations may recover more strongly than developed economies

• The Australian economy has so far held up well and is well positioned to benefit from a potential shift in global growth towards developing economies, particularly in Asia

• Investment return potential in this recovery is more modest than we’ve been used to and volatility is likely to remain high

• Diversification & discipline are still your best friends!

45

Appendix

46

PIC Wholesale Horizon & LTAR Returns* to 30 June 2009

-35%

-30%

-25%

-20%

-15%

-10%

-5%

0%

5%

10%

PIC BondFund (100%

D)

PIC IncomeFund (70/30)

PIC ConsGrowth Fund

(50/50)

PIC BalancedFund (30/70)

PIC GrowthFund(15/85)

PIC ShareFund (100%

G)

PIC Accel.Growth Fund

(130% G)

PIC LTAR

10 year % p.a. 5 year %p.a. 1 Year %p.a. 3 month

•IDPS Fundamentals, MLC LTAR, MLC Income fund and MLC Bond Fund do not have a 5 year track record. Returns are net of fees but before the deduction of any rebates.

47

-30.0%

-20.0%

-10.0%

0.0%

10.0%

20.0%

30.0%

Jan 1999 Oct 1999 Jul 2000 Apr 2001 Jan 2002 Oct 2002 Jul 2003 Apr 2004 Jan 2005 Oct 2005 Jul 2006 Apr 2007 Jan 2008 Oct 2008

Ret

urn

(%pa

)

12 Month Rolling Return 3 Year Rolling Return 5 Year Rolling Return

Return in IDPS Multi-Sector Balanced Growth from Jan 1999 to May 2009MLC0260AU (before tax and after fees)

MLC Wsale - Horizon 4 Balanced

Data Source: Morningstar

PIC IDPS - Consistent added value across market cycles

Horizon 4’s 5 year return has not dipped below 0% in the past. Losses over 1 year periods occur with almost boring regularity.

The rally in risky assets of CYTD2009 is reflected in the up tick in total returns on the RHS.

Note: Mercer data is updated around the 20th business day after month end.48

-5.0%

-4.0%

-3.0%

-2.0%

-1.0%

0.0%

1.0%

2.0%

3.0%

4.0%

5.0%

Jan 1999 Oct 1999 Jul 2000 Apr 2001 Jan 2002 Oct 2002 Jul 2003 Apr 2004 Jan 2005 Oct 2005 Jul 2006 Apr 2007 Jan 2008 Oct 2008

Exc

ess

Ret

urn

(%pa

)

12 Month Rolling Excess Return 3 Year Rolling Excess Return 5 Year Rolling Excess Return

Excess Return in IDPS Multi-Sector Balanced Growth from Jan 1999 to May 2009MLC0260AU versus Median (before tax and after fees)

MLC Wsale - Horizon 4 Balanced

Data Source: Morningstar

Net* performance of PIC IDPS Horizon 4: Rolling 1, 3 & 5 Year Relative Returns

% of time outperformed competitors:1 year: 38%3 years: 38%5 years: 30%

Source: Mercers Retail Balanced Growth Universe, net of super tax and Gold star fees. Mercer data updated around the 20th day after month end.

49

49

5.0%

6.0%

7.0%

8.0%

9.0%

10.0%

11.0%

Jan 2003 Jul 2003 Jan 2004 Jul 2004 Jan 2005 Jul 2005 Jan 2006 Jul 2006 Jan 2007 Jul 2007 Jan 2008 Jul 2008 Jan 2009

Stan

dard

Dev

iati

on (%

pa)

5 Year Rolling Standard Deviation Median Upper Quartile Lower Quartile

Standard Deviation in IDPS Multi-Sector Balanced Growth from Jan 2003 to May 2009MLC0260AU (before tax and after fees)

MLC Wsale - Horizon 4 Balanced

Data Source: Morningstar

MLC PIC IPDS Horizon 4: Absolute volatility (5 yr rolling)

15% below median

50

MLC MK Bus Super Horizon & LTAR Returns* to 30 June 2009

-35%-30%

-25%-20%-15%

-10%-5%0%

5%10%

MLC H1Bond Fund

(100% D)

MLC H2Capital

Stable Fund(70/30)

MLC H3Cons

GrowthFund (50/50)

MLc H4Balanced

Fund (30/70)

MLC H5Growth

Fund(15/85)

MLC H6Share Fund

(100% G)

MLC H7Accel.

GrowthFund (130%

G)

MLC LTAR

10 year %p.a. 5 year %p.a. 1 Year %p.a. 3 month

*Returns are net of management fees and super tax.

51

-32.0%

-24.0%

-16.0%

-8.0%

0.0%

8.0%

16.0%

24.0%

32.0%

Jan 1999 Oct 1999 Jul 2000 Apr 2001 Jan 2002 Oct 2002 Jul 2003 Apr 2004 Jan 2005 Oct 2005 Jul 2006 Apr 2007 Jan 2008 Oct 2008

Ret

urn

(%

pa

)

12 Month Rolling Return 3 Year Rolling Return 5 Year Rolling Return

Return in Employer Super Multi-Sector High Growth from Jan 1999 to May 2009Horizon 5 (after tax and after fees)

MLC MKey Bus Sup - Horizon 5 Growth

Data Source: Morningstar

MLC Business Super Horizon 5 - Consistent added value across market cycles

MLC MK Business Super Horizon 5’s 5 year return has not dipped below 0% in the past. Losses over 1 year periods occur with almost boring regularity.

The rally in risky assets of CYTD2009 is reflected in the up tick in total returns on the RHS.

Source: Mercers Employer Super High Growth Universe, net of super tax and Gold star fees. Note that Mercer data updated around the 20th day after month end.52

-5.0%

-4.0%

-3.0%

-2.0%

-1.0%

0.0%

1.0%

2.0%

3.0%

4.0%

5.0%

Jan 1999 Oct 1999 Jul 2000 Apr 2001 Jan 2002 Oct 2002 Jul 2003 Apr 2004 Jan 2005 Oct 2005 Jul 2006 Apr 2007 Jan 2008 Oct 2008

Exc

ess

Ret

urn

(%pa

)

12 Month Rolling Excess Return 3 Year Rolling Excess Return 5 Year Rolling Excess Return

Excess Return in Employer Super Multi-Sector High Growth - Master Trusts from Jan 1999 to May 2009Horizon 5 versus Median (after tax and after fees)

MLC MKey Bus Sup - Horizon 5 Growth

Data Source: Morningstar

Net* performance of MLC Business Super Horizon 5: Rolling 1, 3 & 5 Year Relative Returns

% of time outperformed Master Trust competitors:1 year: 54%3 years: 68%5 years: 68%

Source: Mercers Employer Super High Growth Master Trust Universe, net of super tax and Gold star fees. Mercer data updated around the 20th day after month end.

53

5.0%

6.5%

8.0%

9.5%

11.0%

12.5%

Jan 2003 Jul 2003 Jan 2004 Jul 2004 Jan 2005 Jul 2005 Jan 2006 Jul 2006 Jan 2007 Jul 2007 Jan 2008 Jul 2008 Jan 2009

Stan

dard

Dev

iati

on (%

pa)

5 Year Rolling Standard Deviation Median Upper Quartile Lower Quartile

Standard Deviation in Employer Super Multi-Sector High Growth - Master Trusts from Jan 2003 to May 2009Horizon 5 (after tax and after fees)

MLC MKey Bus Sup - Horizon 5 Growth

Data Source: Morningstar

MLC MK Business Super Horizon 5: Absolute volatility (5 yr rolling)

100% below median

Source: Mercers Employer Super High Growth Master Trust Universe, net of super tax and Gold star fees. Mercer data updated around the 20th day after month end.

54