ILFS - E-Trade - no impact on business

IL&FS Investsmart Ltd has informed that the following is in respone to the news appearing in certain sections of the Indian press regarding developments at E*TRADE Financial Corporation, USA.

"IL&FS Investsmart Ltd is a listed entity and is adequately capitalized for its regular business endeavors. Speculation around the financial health of E*TRADE Financial Corporation has no impact on IL&FS Investsmart's business.

IL&FS lnvestsmart Ltd is not aware of any intention or desire of E*TRADE Financial Corporation to divest of any of its shareholding in the Company. As reported to the Exchanges on October 25, 2007, Mr. Mitchell Caplan, CEO and Director of E*TRADE Financial Corporation and Mr. Mathias Helleu, Managing Director - International Business were appointed as Directors of IL&FS Investsmart Ltd.

The vision and strategy that has been agreed by the IL&ES Investsmart Ltd Board of Directors is clearly understood by the management team. Execution of this vision and strategy will remain unaffected. A key component of this strategy is leveraging technology to provide investment products to the value driven customer. The IL&FS Investsmart management team continue to leverage the technology expertise of E*TRADE Financial through local management and local software applications."