New Plymouth, New Zealand and New York, United States of America, 30 March 2004 – Powerco Limited (Powerco) and XL Capital Assurance Inc. (XLCA) announced today the completion of Powerco's NZD 250 million (USD 157 million) sale of triple-A rated senior unsecured retailable medium-term notes, for which XLCA provided a financial guarantee. This is the largest retailable – qualified to be sold to the public – financing to date in New Zealand.

The transaction size was increased to NZD 250 million to meet investor demand. The notes, which have tenors of 7-11¼ years, were publicly sold by Westpac and will be used to refinance existing debt.

"This guaranteed bond issue will extend Powerco's maturity profile to the medium-term and will enable Powerco to manage its refinancing risk at levels which are consistent with those approved by Powerco's Board," said Powerco chairman, Barry Upson.

"XLCA was pleased to work with Powerco on a very successful transaction that achieved substantial savings for our client. We continue to be gratified by the enthusiastic reception for the XLCA name in Austral-Asia," said Francisco de la Hoz, XLCA Managing Director and head of the Singapore branch.

Powerco has approximately 400,000 electricity and gas consumer connections in the North Island and a growing presence in Australia with an energy services contracting business based in South East Queensland and the construction of the first natural gas distribution network in Tasmania. Powerco is a publicly listed company, listing on the NZX in December 2000 and is included in the NZSX50 index.

XLCA, rated triple-A by Moody's, Standard & Poor's, and Fitch, is a financial guarantee insurer that specializes in power & utilities, commercial and consumer asset securitization, structured investment products, global infrastructure, future flow securitization, U.S. public finance, bank deposit insurance, and whole business securitizations. XLCA is a subsidiary of XL Capital Ltd (NYSE: XL).

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THIS PRESS RELEASE IS NOT AN OFFER FOR SALE IN THE UNITED STATES. SECURITIES MAY NOT BE OFFERED OR SOLD IN THE UNITED STATES ABSENT REGISTRATION OR AN EXEMPTION FROM REGISTRATION UNDER THE U.S. SECURITIES ACT OF 1933.