UNITED STATES
                       SECURITIES AND EXCHANGE COMMISSION

                             Washington, D.C. 20549
                               ------------------

                                    FORM 10-Q


     [X] Quarterly Report Pursuant to Section 13 or 15(d) of the Securities
                              Exchange Act of 1934
                  For the quarterly period ended June 30, 2003

     [ ] Transition Report Pursuant to Section 13 or 15(d) of the Securities
                              Exchange Act of 1934
                  For the Transition period from ____ to ______

                        Commission File Number 001-16855

                     SCOTTISH ANNUITY & LIFE HOLDINGS, LTD.

             (Exact Name of Registrant as Specified in Its Charter)


        Cayman Islands                                       98-0362785
(State or Other Jurisdiction of                           (I.R.S. Employer
Incorporation or Organization)                           Identification No.)
                                   P.O. Box HM 2939
                               Crown House, Third Floor
                                 4 Par-la-Ville Road
                                    Hamilton HM08
                                       Bermuda
                                                           Not Applicable
           (Address of Principal Executive Offices)          (Zip Code)

       Registrant's telephone number, including area code: (441) 295-4451

   (Former name, former address and former fiscal year, if changed since last
                                    report)

Indicate by check mark whether the Registrant: (1) has filed all reports
required to be filed by Section 13 or 15(d) of the Securities Exchange Act of
1934 during the preceding 12 months (or for such shorter period that the
Registrant was required to file such reports), and (2) has been subject to such
filing requirements for the past 90 days. Yes X No

Indicate by check mark whether the registrant is an accelerated filer (as
defined in Rule 12b-2 of the Exchange Act). Yes X No

As of August 1, 2003, Registrant had 35,045,542 ordinary shares outstanding.


<PAGE>


                                Table of Contents


PART I.  FINANCIAL INFORMATION.................................................2

Item 1.  Financial Statements..................................................2

Consolidated Balance Sheets - June 30, 2003 (Unaudited) and
  December 31, 2002............................................................2

Unaudited Consolidated Statements of Income - Three and six months ended
  June 30, 2003 and 2002.......................................................3

Unaudited Consolidated Statements of Comprehensive Income - Three and Six
   months ended June 30, 2003 and 2002.........................................4

Unaudited Consolidated Statements of Shareholders' Equity - Six months ended
  June 30, 2003 and 2002.......................................................5

Unaudited Consolidated Statements of Cash Flows - Six months ended
  June 30, 2003 and 2002.......................................................6

Notes to Unaudited Consolidated Financial Statements at June 30, 2003..........8

Item 2.  Management's Discussion and Analysis of Financial Condition
          and Results of Operations...........................................17

Item 3.  Quantitative and Qualitative Disclosures About Market Risk...........41

Item 4.  Disclosure Controls and Procedures...................................41

PART II. OTHER INFORMATION....................................................42

Item 1.  Legal Proceedings....................................................42

Item 2.  Changes in Securities and Use of Proceeds............................42

Item 3.  Defaults Upon Senior Securities......................................42

Item 4.  Submission of Matters to a Vote of Securities Holders................43

Item 5.  Other Information....................................................44

Item 6.  Exhibits and Reports on Form 8-K.....................................44

SIGNATURES....................................................................49


                                       i

<PAGE>


PART I.   FINANCIAL INFORMATION
Item 1.   Financial Statements

                     Scottish Annuity & Life Holdings, Ltd.
             Consolidated Balance Sheets - June 30, 2003 (Unaudited)
                              and December 31, 2002
                             (Dollars in thousands)

<TABLE>
<CAPTION>
                                                                            June 30,
                                                                              2003             December 31,
                                                                          (unaudited)              2002
                                                                        ----------------     ----------------
<S>                                                                     <C>                  <C>
ASSETS
Fixed maturity investments, available for sale, at fair value
(Amortized cost $1,253,882; 2002 - $991,304).......................     $    1,292,208       $    1,003,946
Preferred stock, available for sale, at fair value (Cost $48,769 ).             49,711                    -
Investment in unit-linked securities...............................                  -               16,497
Cash and cash equivalents..........................................            131,322              149,666
Other investments..................................................              5,653                5,631
Funds withheld at interest.........................................          1,184,920            1,101,836
                                                                        ----------------     ----------------
     Total investments.............................................          2,663,814            2,277,576
Accrued interest receivable........................................             14,823               11,910
Reinsurance balances and risk fees receivable......................             81,054               39,805
Deferred acquisition costs.........................................            262,015              213,516
Amount recoverable from reinsurers.................................             18,241               22,608
Present value of in-force business.................................             14,686               18,181
Goodwill...........................................................             35,847               35,847
Fixed assets.......................................................              9,259                6,493
Other assets.......................................................             10,832               11,702
Segregated assets..................................................            723,906              653,588
                                                                        ----------------     ----------------
     Total assets..................................................     $    3,834,477       $    3,291,226
                                                                        ================     ================
LIABILITIES
Reserves for future policy benefits................................     $      477,772       $      386,807
Interest sensitive contract liabilities............................          1,920,223            1,567,176
Unit-linked contract liabilities...................................                  -               17,069
Accounts payable and accrued expenses..............................             13,644               15,702
Reinsurance balances payable.......................................             18,497               16,348
Deferred tax liability.............................................             16,336                9,071
Current income tax payable.........................................              1,428                1,873
Long term debt.....................................................            132,500              132,500
Segregated liabilities.............................................            723,906              653,588
                                                                        ----------------     ----------------
     Total liabilities.............................................          3,304,306            2,800,134
                                                                        ----------------     ----------------
SHAREHOLDERS' EQUITY
Share capital, par value $0.01 per ordinary share:.................
     Issued and fully paid: 27,363,042 ordinary shares
     (2002 - 26,927,456)...........................................                274                  269
Additional paid-in capital.........................................            421,954              416,712
Accumulated other comprehensive income.............................             34,889               13,467
Retained earnings..................................................             73,054               60,644
                                                                        ----------------     ----------------
     Total shareholders' equity....................................            530,171              491,092
                                                                        ----------------     ----------------
     Total liabilities and shareholders' equity....................     $    3,834,477       $    3,291,226
                                                                        ================     ================
</TABLE>

      See Accompanying Notes to Unaudited Consolidated Financial Statements


                                       2

<PAGE>


                     Scottish Annuity & Life Holdings, Ltd.
                  Unaudited Consolidated Statements of Income -
                Three and Six months ended June 30, 2003 and 2002
                  (Dollars in thousands, except per share data)


<TABLE>
<CAPTION>
                                                    Three months     Three months         Six months       Six months
                                                        ended            ended              ended            ended
                                                   June 30, 2003    June 30, 2002       June 30, 2003    June 30, 2002
                                                   -------------    -------------       -------------    -------------
<S>                                                <C>              <C>                 <C>              <C>
REVENUES
Premiums earned..................................  $    94,737      $    37,628         $   159,556      $   68,983
Investment income, net...........................       35,941           26,136              68,245          47,867
Fee income.......................................        2,380            2,201               4,371           4,275
Realized losses..................................       (3,392)          (1,606)             (5,713)         (3,305)
                                                   -------------    -------------       -------------    -------------
     Total revenues..............................      129,666           64,359             226,459         117,820
                                                   -------------    -------------       -------------    -------------

BENEFITS AND EXPENSES
Claims and other policy benefits.................       65,676           26,656             108,570          50,543
Interest credited to interest sensitive
contract liabilities.............................       16,874           11,228              32,767          20,406
Acquisition costs and other insurance expenses,
net..............................................       27,884           12,040              48,539          22,869
Operating expenses...............................        8,148            6,236              16,013          10,153
Interest expense.................................        1,851              138               3,664             482
                                                   -------------    -------------       -------------    -------------
     Total benefits and expenses.................      120,433           56,298             209,553         104,453
                                                   -------------    -------------       -------------    -------------
Income from continuing operations before income
taxes............................................        9,233            8,061              16,906          13,367
Income tax expense (benefit).....................          (84)             121                 166             429
                                                   -------------    -------------       -------------    -------------
     Income from continuing operations...........        9,317            7,940              16,740          12,938
                                                   -------------    -------------       -------------    -------------
Loss from discontinued operations................        1,445               91               1,625              91
                                                   -------------    -------------       -------------    -------------

     Net income                                    $     7,872      $     7,849         $    15,115      $   12,847
                                                   =============    =============       =============    =============

Earnings per ordinary share from continuing
operations -Basic................................  $      0.34      $      0.30         $      0.62      $     0.55
                                                   =============    =============       =============    =============

Earnings per ordinary share from continuing
operations - Diluted.............................  $      0.33      $      0.28         $      0.59      $     0.52
                                                   =============    =============       =============    =============

Earnings per ordinary share - Basic..............  $      0.29      $      0.29         $      0.56      $     0.55
                                                   =============    =============       =============    =============

Earnings per ordinary share -Diluted.............  $      0.28      $      0.28         $      0.53      $     0.51
                                                   =============    =============       =============    =============

Dividends per ordinary share.....................  $      0.05      $      0.05         $      0.10      $     0.10
                                                   =============    =============       =============    =============

Weighted average number of ordinary shares
outstanding......................................
     Basic.......................................   27,101,357       26,683,204          27,038,103      23,432,731
                                                   =============    =============       =============    =============
     Diluted.....................................   28,587,540       28,504,230          28,371,379      24,946,671
                                                   =============    =============       =============    =============
</TABLE>


      See Accompanying Notes to Unaudited Consolidated Financial Statements


                                       3

<PAGE>


                     Scottish Annuity & Life Holdings, Ltd.
           Unaudited Consolidated Statements of Comprehensive Income -
                Three and Six months ended June 30, 2003 and 2002
                             (Dollars in thousands)


<TABLE>
<CAPTION>
                                               Three months      Three months      Six months       Six months
                                              ended June 30,    ended June 30,        ended            ended
                                                   2003              2002         June 30, 2003    June 30, 2002
                                              --------------    --------------    -------------    -------------

<S>                                               <C>             <C>               <C>               <C>
Net income ..............................         $  7,872        $  7,849          $ 15,115          $ 12,847
                                                  --------        --------          --------          --------
Other comprehensive income, net of
tax
     Unrealized appreciation
     on investments: ....................           20,409          10,752            25,476             4,878
     Add: reclassification adjustment for
     investment losses included in net
     income .............................           (4,629)         (1,256)           (6,035)               24
                                                  --------        --------          --------          --------
Unrealized appreciation  on investments
net of income tax expense  of $4,533;
$2,100; $6,831 and $1,085 ...............           15,780           9,496            19,441             4,902
Cumulative translation adjustment .......            2,747           3,652             2,020             2,988
Minimum pension liability adjustment ....              (61)            -                 (39)              -
                                                  --------        --------          --------          --------
Other comprehensive income ..............           18,466          13,148            21,422             7,890
                                                  --------        --------          --------          --------
Comprehensive income ....................         $ 26,338        $ 20,997          $ 36,537          $ 20,737
                                                  ========        ========          ========          ========
</TABLE>


      See Accompanying Notes to Unaudited Consolidated Financial Statements


                                       4

<PAGE>


                     Scottish Annuity & Life Holdings, Ltd.
           Unaudited Consolidated Statements of Shareholders' Equity -
                     Six months ended June 30, 2003 and 2002
                             (Dollars in thousands)


<TABLE>
<CAPTION>
                                                           Six months ended     Six months ended
                                                             June 30, 2003        June 30, 2002
                                                           ----------------     ----------------
<S>                                                         <C>                  <C>
ORDINARY SHARES:
     Beginning of period ............................         26,927,456           20,144,956
     Ordinary shares issued .........................                -              6,750,000
     Issuance to employees on exercise of options ...            235,586               15,000
     Issuance on exercise of warrants ...............            200,000                  -
                                                           --------------       --------------
     End of period ..................................         27,363,042           26,909,956
                                                           ==============       ==============

SHARE CAPITAL:
     Beginning of period ............................       $        269         $        201
     Ordinary shares issued .........................                -                     67
     Issuance to employees on exercise of options ...                  3                    1
     Issuance on exercise of warrants ...............                  2                  -
                                                           --------------       --------------
     End of period ..................................                274                  269
                                                           --------------       --------------

ADDITIONAL PAID-IN CAPITAL:
     Beginning of period ............................            416,712              301,542
     Ordinary shares issued .........................                -                114,284
     Issuance to employees on exercise of options ...              2,244                  144
     Issuance on exercise of  warrants ..............              2,998                  -
                                                           --------------       --------------
     End of period ..................................            421,954              415,970
                                                           --------------       --------------

ACCUMULATED OTHER COMPREHENSIVE INCOME:
Unrealized appreciation (depreciation) on investments
     Beginning of period ............................              8,930               (3,626)
     Change in period (net of tax) ..................             19,441                4,902
                                                           --------------       --------------
     End of period ..................................             28,371                1,276
                                                           --------------       --------------
Cumulative translation adjustment
     Beginning of period ............................              5,908                  -
     Change in period ...............................              2,020                2,988
                                                           --------------       --------------
     End of period ..................................              7,928                2,988
                                                           --------------       --------------
Minimum pension liability adjustment
     Beginning of period ............................             (1,371)                 -
     Change in period ...............................                (39)                 -
                                                           --------------       --------------
     End of period ..................................             (1,410)                 -
                                                           --------------       --------------

ACCUMULATED OTHER COMPREHENSIVE INCOME ..............             34,889                4,264
                                                           --------------       --------------

RETAINED EARNINGS:
     Beginning of period ............................             60,644               33,165
     Net income .....................................             15,115               12,847
     Dividends paid .................................             (2,705)              (2,352)
                                                           --------------       --------------
     End of period ..................................             73,054               43,660
                                                           --------------       --------------
TOTAL SHAREHOLDERS' EQUITY ..........................       $    530,171         $    464,163
                                                           ==============       ==============
</TABLE>


      See Accompanying Notes to Unaudited Consolidated Financial Statements


                                       5

<PAGE>


                     Scottish Annuity & Life Holdings, Ltd.
                Unaudited Consolidated Statements of Cash Flows -
                     Six months ended June 30, 2003 and 2002
                             (Dollars in thousands)


<TABLE>
<CAPTION>
                                                                                 Six months ended    Six months ended
                                                                                   June 30, 2003      June 30, 2002
                                                                                 ----------------    ----------------
<S>                                                                              <C>                <C>
OPERATING ACTIVITIES
Net income.................................................................      $     15,115       $     12,847
Items not affecting cash:..................................................
     Net realized losses...................................................             5,713              3,305
     Amortization of investments...........................................             1,964                173
     Amortization of deferred acquisition costs............................            21,587             13,596
     Amortization of present value of in-force business....................             1,694              1,080
     Changes in assets and liabilities:....................................
         Accrued interest..................................................            (2,778)              (685)
         Reinsurance balances and risk fees receivable.....................           (36,904)             3,098
         Deferred acquisition costs........................................           (67,929)           (50,188)
         Deferred tax liability............................................              (391)               514
         Other assets......................................................               869              3,643
         Current income tax receivable and payable.........................              (445)               510
         Reserves for future policy benefits...............................            92,431               (430)
         Interest sensitive contract liabilities, net of funds withheld at
         interest..........................................................             8,928             10,046
         Unit linked contract liabilities..................................                 -             (6,704)
         Accounts payable and accrued expenses.............................            (3,181)            (1,782)
         Other.............................................................            (1,125)             1,752
                                                                                 ----------------    ----------------
Net cash provided by (used in) operating activities........................            35,548             (9,225)
                                                                                 ----------------    ----------------

INVESTING ACTIVITIES
Purchase of fixed maturity investments.....................................          (430,902)          (218,605)
Proceeds from sales of fixed maturity investments..........................            60,369             71,223
Proceeds from maturity of fixed maturity investments.......................           104,615             41,677
Purchase of preferred stock ...............................................           (49,726)                 -
Proceeds from sales of preferred stock.....................................               363                  -
Proceeds from maturity of preferred stock..................................               587                  -
Costs of acquisition of World-Wide Holdings................................                 -             (1,276)
Purchase of fixed assets...................................................            (2,774)                 -
                                                                                 ----------------    ----------------
Net cash used in investing activities......................................          (317,468)          (106,981)
                                                                                 ----------------    ----------------

FINANCING ACTIVITIES
Deposits to interest sensitive contract liabilities........................           278,687             22,146
Withdrawals from interest sensitive contract liabilities...................           (17,653)           (12,224)
Borrowings.................................................................                 -            (42,814)
Issuance of ordinary shares................................................             5,247            114,496
Dividends paid.............................................................            (2,705)            (2,352)
                                                                                 ----------------    ----------------
Net cash provided by financing activities,.................................           263,576             79,252
                                                                                 ----------------    ----------------

NET CHANGE IN CASH AND CASH EQUIVALENTS                                               (18,344)           (36,954)
Cash and cash equivalents, beginning of period.............................           149,666             94,581
                                                                                 ----------------    ----------------

CASH AND CASH EQUIVALENTS, END OF PERIOD                                         $    131,322        $    57,627
                                                                                 ================    ================
</TABLE>

      See Accompanying Notes to Unaudited Consolidated Financial Statements

                                       6

<PAGE>


                     Scottish Annuity & Life Holdings, Ltd.
              Notes to Unaudited Consolidated Financial Statements
                                At June 30, 2003


1.   Basis of presentation

     Accounting Principles - The accompanying unaudited consolidated financial
statements have been prepared in accordance with generally accepted accounting
principles in the United States of America ("GAAP") and with the instructions to
Form 10-Q and Article 10 of Regulation S-X. Accordingly, they do not include all
of the information and footnotes required by GAAP for complete financial
statements. In the opinion of management, all adjustments (consisting of normal
recurring accruals) considered necessary for a fair presentation have been
included. The results for the period are not necessarily indicative of the
results to be expected for the entire year.

     For further information, refer to the consolidated financial statements and
footnotes included in our annual report on Form 10-K for the period ended
December 31, 2002.

     All tabular amounts are reported in thousands of United States dollars
(except per share amounts).

     Certain prior period amounts have been reclassified to conform to the
current year presentation.

2.   New Accounting Pronouncements

     In December 2002, the Financial Accounting Standards Board ("FASB") issued
Statement of Financial Accounting Standard ("SFAS") No. 148, "Accounting for
Stock-Based Compensation - Transition and Disclosure, an Amendment of FASB
Statement No. 123". In prior years, we applied the intrinsic value-based expense
provisions set forth in ABP Opinion No. 25, "Accounting for Stock Issued to
Employees" and did not recognize compensation expense. Effective January 1, 2003
we have adopted the modified prospective method of fair value-based stock option
expense provisions of SFAS No. 123 as amended by SFAS No. 148. This has resulted
in a charge to income of $81,000 in the three and six month periods ended June
30, 2003.

     In May 2003, FASB approved for issuance a Statement of Position ("SOP"),
"Accounting and Reporting by Insurance Enterprises for Certain Nontraditional
Long-Duration Insurance Contracts and for Separate Accounts". This Statement of
Position provides guidance on accounting and reporting by insurance enterprises
for certain nontraditional long-duration contracts and for separate accounts and
is effective for financial statements for fiscal years beginning after December
15, 2003. At the date of initial application of this SOP, we are required to
make various determinations, such as qualification for separate account
treatment, classification of securities in separate account arrangements,
significance of mortality and morbidity risk, adjustments to contract holder
liabilities, and adjustments to estimated gross profits as defined in SFAS No.
97, "Accounting and Reporting by Insurance Enterprises for Certain Long-Duration
Contracts and for Realized Gains and Losses from the Sale of Investments". We do
not believe the implementation of this SOP will have a material effect on our
financial statements.

     The Derivative Implementation Group has released Statement 133
Implementation Issue No. 36, "Embedded Derivatives: Bifurcation of a Debt
Instrument that Incorporates Both Interest Rate Risk and Credit Rate Risk
Exposures that are Unrelated or Only Partially Related to the Creditworthiness
of the Issuer of that Instrument" ("DIG B36"). DIG B36 addresses whether SFAS
No. 133 "Accounting for Derivative Instruments and Hedging Activities" requires
bifurcation of a debt instrument into a debt host contract and an embedded
derivative if the debt instrument incorporates both interest rate risk and
credit risk exposures that are unrelated or only partially related to the
creditworthiness of the issuer of that


                                       7

<PAGE>

                     Scottish Annuity & Life Holdings, Ltd.
              Notes to Unaudited Consolidated Financial Statements
                                At June 30, 2003

instrument. Under DIG B36 modified coinsurance reinsurance agreements, where
interest is determined by reference to a pool of fixed maturity assets, are
arrangements containing embedded derivatives requiring bifurcation. Our funds
withheld at interest, which arise under modified coinsurance agreements, are
therefore considered to contain embedded derivatives requiring bifurcation. We
are required to adopt DIG B36 in the quarter ending December 31, 2003. We have
not yet determined the value of the related embedded derivatives in our funds
withheld at interest. The market value of funds withheld at interest was $1.3
billion at June 30, 2003.

3.   Discontinued operations

     During the quarter ended June 30, 2003 we decided to discontinue our Wealth
Management operations in Luxembourg. We are in the process of transferring our
Luxembourg Wealth Management business to third parties and we expect to complete
the closure of this office by December 31, 2003. We have reported the results of
the Luxembourg Wealth Management activities as discontinued operations. During
the quarter ended June 30, 2003 losses from these operations amounted to $1.4
million ($0.05 per diluted share) in comparison with $91,000 in the prior year
period. The losses recorded in the current quarter include the write down of a
deferred tax asset of $349,000, which had arisen from prior year net operating
losses, and estimates of severance costs and costs to close the operation.
Losses incurred in respect of these operations in the six month period ended
June 30, 2003 and 2002 amounted to $1.6 million ($0.06 per diluted share) and
$91,000, respectively.


                                       8
<PAGE>

                     Scottish Annuity & Life Holdings, Ltd.
              Notes to Unaudited Consolidated Financial Statements
                                At June 30, 2003


4.   Business segments

     We report segments in accordance with SFAS No. 131, "Disclosures about
Segments of an Enterprise and Related Information". Our main lines of business
are Life Reinsurance North America, Life Reinsurance International and Wealth
Management. The segment reporting for the lines of business is as follows:


<TABLE>
<CAPTION>
                                                                Three months ended June 30, 2003
                                     -----------------------------------------------------------------------------------
                                          Life             Life
                                      Reinsurance       Reinsurance          Wealth
                                     North America     International       Management         Other            Total
                                     -------------     -------------     -------------    -------------    -------------
<S>                                    <C>               <C>                <C>               <C>           <C>
Premiums earned ...............        $  56,565         $  38,172          $   -             $    -        $  94,737
Investment income, net ........           32,680             2,125               60              1,076         35,941
Fee income ....................            1,337               -              1,043                -            2,380
Realized gains (losses) .......           (3,294)             (264)              (8)               174         (3,392)
                                     -------------     -------------     -------------    -------------    -------------
Total revenues ................           87,288            40,033            1,095              1,250        129,666
                                     -------------     -------------     -------------    -------------    -------------

Claims and other policy
   benefits ...................           42,821            22,855              -                  -           65,676
Interest credited to interest
   sensitive contract
   liabilities ................           16,874               -                -                  -           16,874
Acquisition costs and other
   insurance expenses, net ....           19,815             7,690              379                -           27,884
Operating expenses ............            2,372             3,292              193              2,291          8,148
Interest expense ..............              240               -                -                1,611          1,851
                                     -------------     -------------     -------------    -------------    -------------
Total benefits and expenses ...           82,122            33,837              572              3,902        120,433
                                     -------------     -------------     -------------    -------------    -------------
Net income (loss) from continuing
   operations before income taxes      $   5,166         $   6,196          $   523          $  (2,652)     $   9,233
                                     =============     =============     =============    =============    =============
</TABLE>


                                       9
<PAGE>

                     Scottish Annuity & Life Holdings, Ltd.
              Notes to Unaudited Consolidated Financial Statements
                                At June 30, 2003

<TABLE>
<CAPTION>
                                                                Three months ended June 30, 2002
                                     -----------------------------------------------------------------------------------
                                          Life             Life
                                      Reinsurance       Reinsurance          Wealth
                                     North America     International       Management         Other            Total
                                     -------------     -------------     -------------    -------------    -------------
<S>                                    <C>               <C>                <C>               <C>           <C>
Premiums earned .................       $ 23,382         $  14,246          $   -             $   -          $ 37,628
Investment income, net ..........         23,157             1,705              (46)            1,320          26,136
Fee income ......................          1,316               -                885               -             2,201
Realized gains (losses) .........            404            (2,118)             -                 108          (1,606)
                                     -------------     -------------     -------------    -------------    -------------
Total revenues ..................         48,259            13,833              839             1,428          64,359
                                     -------------     -------------     -------------    -------------    -------------

Claims and other policy benefits          17,528             9,128              -                 -            26,656
Interest credited to interest
   sensitive contract liabilities         11,155                73              -                 -            11,228
Acquisition costs and other
   insurance expenses, net ......         10,952               139              949               -            12,040
Operating expenses ..............          1,772             1,767              377             2,320           6,236
Interest expense ................            -                 -                -                 138             138
                                     -------------     -------------     -------------    -------------    -------------
Total benefits and expenses .....         41,407            11,107            1,326             2,458          56,298
                                     -------------     -------------     -------------    -------------    -------------
Net income (loss) from continuing
   operations before income taxes       $  6,852         $   2,726          $  (487)         $ (1,030)       $  8,061
                                     =============     =============     =============    =============    =============
</TABLE>


<TABLE>
<CAPTION>
                                                                Six months ended June 30, 2003
                                     -----------------------------------------------------------------------------------
                                          Life             Life
                                      Reinsurance       Reinsurance          Wealth
                                     North America     International       Management         Other            Total
                                     -------------     -------------     -------------    -------------    -------------
<S>                                    <C>               <C>                <C>                <C>           <C>
Premiums earned .................      $  96,025         $  63,531          $   -              $   -        $ 159,556
Investment income, net ..........         62,280             3,851               94              2,020         68,245
Fee income ......................          2,396               -              1,975                -            4,371
Realized gains (losses) .........         (5,052)             (873)              (8)               220         (5,713)
                                     -------------     -------------     -------------    -------------    -------------
Total revenues ..................        155,649            66,509            2,061              2,240        226,459
                                     -------------     -------------     -------------    -------------    -------------

Claims and other policy benefits          72,226            36,344              -                  -          108,570
Interest credited to interest
   sensitive contract liabilities         32,767               -                -                  -           32,767
Acquisition costs and other
   insurance expenses, net ......         34,267            13,221            1,051                -           48,539
Operating expenses ..............          4,415             5,840              355              5,403         16,013
Interest expense ................            477               -                -                3,187          3,664
                                     -------------     -------------     -------------    -------------    -------------
Total benefits and expenses .....        144,152            55,405            1,406              8,590        209,553
                                     -------------     -------------     -------------    -------------    -------------
Net income (loss) from continuing
   operations before income taxes      $  11,497         $  11,104          $   655            $(6,350)     $  16,906
                                     =============     =============     =============    =============    =============
</TABLE>


                                       10
<PAGE>


                     Scottish Annuity & Life Holdings, Ltd.
              Notes to Unaudited Consolidated Financial Statements
                                At June 30, 2003

<TABLE>
<CAPTION>
                                                                Six months ended June 30, 2002
                                     -----------------------------------------------------------------------------------
                                          Life             Life
                                      Reinsurance       Reinsurance          Wealth
                                     North America     International       Management         Other            Total
                                     -------------     -------------     -------------    -------------    -------------
<S>                                    <C>               <C>                <C>             <C>             <C>
Premiums earned ...............        $  42,530         $  26,453          $     -         $        -      $  68,983
Investment income, net ........           42,683             3,108             (129)             2,205         47,867
Fee income ....................            2,609               -              1,666                -            4,275
Realized losses ...............             (733)           (2,486)               -                (86)        (3,305)
                                     -------------     -------------     -------------    -------------    -------------
Total revenues ................           87,089            27,075            1,537              2,119        117,820
                                     -------------     -------------     -------------    -------------    -------------

Claims and other policy
   benefits ...................           33,142            17,401                -                  -         50,543
Interest credited to interest
   sensitive contract
   liabilities ................           20,318                88                -                  -         20,406
Acquisition costs and other
   insurance expenses, net ....           19,675             1,674            1,513                  7         22,869
Operating expenses ............            2,697             3,454              587              3,415         10,153
Interest expense ..............              -                 -                  -                482            482
                                     -------------     -------------     -------------    -------------    -------------
Total benefits and expenses ...           75,832            22,617            2,100              3,904        104,453
                                     -------------     -------------     -------------    -------------    -------------
Net income (loss) from continuing
   operations before income taxes      $  11,257         $   4,458          $  (563)         $  (1,785)     $  13,367
                                     =============     =============     =============    =============    =============
</TABLE>



<TABLE>
<CAPTION>
                 Assets                                          June 30, 2003     December 31, 2002
                                                               -----------------   -----------------
<S>                                                                 <C>                <C>
                 Life Reinsurance
                     North America........................          $ 2,700,027        $ 2,236,089
                     International........................              268,073            265,658
                                                               -----------------   -----------------
                 Total Life Reinsurance...................            2,968,100          2,501,747
                 Wealth Management........................              762,601            681,534
                 Other....................................              103,776            107,945
                                                               -----------------   -----------------
                 Total....................................          $ 3,834,477        $ 3,291,226
                                                               =================   =================
</TABLE>


                                       11
<PAGE>

                     Scottish Annuity & Life Holdings, Ltd.
              Notes to Unaudited Consolidated Financial Statements
                                At June 30, 2003

5.   Earnings per ordinary share

     The following table sets forth the computation of basic and diluted
earnings per ordinary share:



<TABLE>
<CAPTION>
                                         Three months     Three months       Six months        Six months
                                            ended           ended               ended            ended
                                        June 30, 2003    June 30, 2002     June 30, 2003     June 30, 2002
                                        -------------    -------------     -------------     -------------
<S>                                     <C>               <C>               <C>                <C>
Numerator:
Net income ........................     $     7,872       $     7,849       $    15,115        $    12,847
                                        =============    =============     =============     =============
Denominator:
Denominator for basic
   earnings per ordinary
   share - Weighted average
   number of ordinary shares.......      27,101,357        26,683,204        27,038,103        23,432,731
                                        =============    =============     =============     =============

Effect of dilutive securities
 - Stock options ..................         882,360         1,055,956           821,246           926,607
 - Warrants .......................         603,823           765,070           512,030           587,333
                                        -------------    -------------     -------------     -------------
Denominator for dilutive
   earnings per ordinary share           28,587,540        28,504,230        28,371,379        24,946,671
                                        =============    =============     =============     =============
 Earnings per ordinary share
    from continuing operations
    -Basic.........................          $ 0.34            $ 0.30            $ 0.62            $ 0.55
                                        =============    =============     =============     =============
 Earnings per ordinary share
    from continuing operations
    - Diluted......................          $ 0.33            $ 0.28            $ 0.59            $ 0.52
                                        =============    =============     =============     =============
 Basic earnings per ordinary
    share..........................          $ 0.29            $ 0.29            $ 0.56            $ 0.55
                                        =============    =============     =============     =============
 Diluted earnings per ordinary share         $ 0.28            $ 0.28            $ 0.53            $ 0.51
                                        =============    =============     =============     =============
</TABLE>

6.   Deferred acquisition costs

     The change in deferred acquisition costs is as follows:

<TABLE>
<CAPTION>
                                         Three months     Three months      Six months        Six months
                                            ended           ended              ended            ended
                                        June 30, 2003    June 30, 2002    June 30, 2003     June 30, 2002
                                        -------------    -------------    -------------     -------------
<S>                                     <C>               <C>              <C>                <C>
Balance beginning of period........      $    231,414     $    131,073     $   213,516        $  113,898
Expenses deferred..................            41,325           27,028          67,929            49,688
Amortization expense...............           (12,454)          (8,346)        (21,587)          (13,596)
Deferred acquisition costs on
 realized losses...................
                                                1,730              709           2,157               474
                                        -------------    -------------    -------------      ------------
  Balance end of period............      $    262,015     $    150,464     $   262,015        $  150,464
                                        =============    =============    =============      ============
</TABLE>



                                       12
<PAGE>


                     Scottish Annuity & Life Holdings, Ltd.
              Notes to Unaudited Consolidated Financial Statements
                                At June 30, 2003

7.   Due to Related Parties

     In the normal course of business, we enter into reinsurance contracts with
Pacific Life Insurance Company in which we both assume and cede business.
Amounts due to Pacific Life of $1.3 million at June 30, 2003 are included in
reinsurance balances payable. Amounts due from Pacific Life of $817,000 at
December 31, 2002 are included in reinsurance balances and risk fees receivable.

8.   Credit Facilities

     During 2002, we arranged two secured credit facilities with U.S. banks
totaling $100 million. Each of the credit facilities provides a combination of
borrowings and letters of credit of up to $50 million. Interest rates on amounts
borrowed under these facilities are LIBOR plus 45-50 basis points. These
facilities expire in September 2003 but are renewable upon the agreement of both
parties. At June 30, 2003 and December 31, 2002 there were no borrowings under
these facilities. Outstanding letters of credit at June 30, 2003 and December
31, 2002 amounted to $27.6 million and $9.1 million, respectively. Each facility
has covenants, including a consolidated net worth covenant and a maximum
leverage covenant.

     We also have a reverse repurchase agreement with a major broker/dealer.
Under this agreement, we have the ability to sell agency mortgage backed
securities with the agreement to repurchase them at a fixed price, providing the
dealer with a spread that equates to an effective borrowing cost linked to
one-month LIBOR. This agreement is renewable monthly at the discretion of the
broker/dealer. At June 30, 2003 and December 31, 2002, there were no borrowings
under this agreement.

9.   Long-term debt

     Long-term debt consists of:

<TABLE>
<CAPTION>
                                                         June 30, 2003   December 31, 2002
                                                         -------------   -----------------
<S>                                                       <C>                <C>
     4.5% senior convertible notes due 2022.........      $  115,000         $ 115,000
     Capital securities.............................          17,500            17,500
                                                         -------------      ------------
     Total                                                $  132,500         $ 132,500
                                                         =============      ============
</TABLE>

4.5% Senior convertible notes

     On November 22, 2002 and November 27, 2002, we issued an aggregate of
$115.0 million (which included an over allotment option of $15.0 million) of
4.5% senior convertible notes, which are due December 1, 2022, to qualified
institutional buyers. The notes are general unsecured obligations, ranking on a
parity in right of payment with all our existing and future unsecured senior
indebtedness, and senior in right of payment with all our future subordinated
indebtedness. Interest on the notes is payable on June 1 and December 1 of each
year, beginning on June 1, 2003. The notes are rated Baa2 by Moody's Investors
Service ("Moody's") and BBB- by Standard & Poor's Ratings Group ("Standard &
Poor's").

     The notes are convertible into our ordinary shares at an initial conversion
rate of 46.0617 ordinary shares per $1,000 principal amount of notes (equivalent
to an initial conversion price of $21.71 per ordinary share), subject to our
right to deliver, in lieu of our ordinary shares, cash or a combination of cash
and our ordinary shares. The notes are redeemable at our option in whole or in
part beginning on December 6, 2006, at a redemption price equal to 100% of the
principal amount of the notes plus accrued


                                       13
<PAGE>

                     Scottish Annuity & Life Holdings, Ltd.
              Notes to Unaudited Consolidated Financial Statements
                                At June 30, 2003

and unpaid interest. The notes are subject to repurchase by us upon a change of
control of Scottish Annuity & Life or at a holder's option on December 6, 2006,
December 1, 2010, December 1, 2012 and December 1, 2017, at a repurchase price
equal to 100% of the principal amount of the notes plus accrued and unpaid
interest. The notes are due on December 1, 2022 unless earlier converted,
redeemed by us at our option or repurchased by us at a holder's option.

     A holder may surrender notes for conversion prior to the stated maturity
only under the following circumstances:

     o    during any conversion period if the sale price of our ordinary shares
          for at least 20 trading days in the period of 30 consecutive trading
          days ending on the first day of the conversion period exceeds 120% of
          the conversion price in effect on that 30th trading day;

     o    during any period in which the notes are rated by either Moody's or
          Standard & Poor's and the credit rating assigned to the notes by
          either rating agency is downgraded by two levels or more, suspended or
          withdrawn;

     o    if we have called those notes for redemption; or

     o    upon the occurrence of certain specified corporate transactions.

     Under a registration rights agreement, we agreed to file with the
Securities and Exchange Commission, a shelf registration statement, for resale
of the notes and our ordinary shares issuable upon conversion of the notes. This
registration statement was filed and later declared effective by the Securities
and Exchange Commission on April 4, 2003.

Capital securities

     On December 4, 2002, Scottish Holdings Statutory Trust I, a Connecticut
statutory business trust ("Capital Trust") issued and sold in a private offering
an aggregate of $17.5 million Floating Rate Capital Securities (the "capital
securities"). All of the common shares of the Capital Trust are owned by
Scottish Holdings, Inc., our wholly owned subsidiary.

     The capital securities mature on December 4, 2032. They are redeemable in
whole or in part at any time after December 4, 2007. Interest is payable
quarterly at a rate equivalent to 3 month LIBOR plus 4%. At June 30, 2003 and
December 31, 2002, the interest rates were 5.12% and 5.42%, respectively. Prior
to December 4, 2007, interest cannot exceed 12.5%. The Capital Trust may defer
payment of the interest for up to 20 consecutive quarterly periods, but no later
than December 4, 2032. Any deferred payments would accrue interest quarterly on
a compounded basis if Scottish Holdings, Inc. defers interest on the Debentures
due December 4, 2032 (as defined below).

     The sole assets of the Capital Trust consist of $18.0 million principal
amount of Floating Rate Debentures (the "Debentures") issued by Scottish
Holdings, Inc. The Debentures mature on December 4, 2032 and interest is payable
quarterly at a rate equivalent to 3-month LIBOR plus 4%. At June 30, 2003 and
December 31, 2002, the interest rates were 5.12% and 5.42%, respectively. Prior
to December 4, 2007, interest cannot exceed 12.5%. Scottish Holdings, Inc. may
defer payment of the interest for up to 20 consecutive quarterly periods, but no
later than December 4, 2032. Any deferred payments would accrue interest
quarterly on a compounded basis. Scottish Holdings, Inc. may redeem the
Debentures at any time after December 4, 2007 in the event of certain changes in
tax or investment company law.


                                       14
<PAGE>

                     Scottish Annuity & Life Holdings, Ltd.
              Notes to Unaudited Consolidated Financial Statements
                                At June 30, 2003

     Scottish Annuity & Life Insurance Company (Cayman) Ltd. has guaranteed
Scottish Holdings, Inc.'s obligations under the Debentures and distributions and
other payments due on the capital securities.

10.  Stock option plans

     We have four stock option plans (the "1998 Plan", the "1999 Plan", the
"Harbourton Plan" and the "2001 Plan", collectively the "Plans"), which allow us
to grant non-statutory options, subject to certain restrictions, to certain
eligible employees, non-employee directors, advisors and consultants. The
minimum exercise price of the options will be equal to the fair market value, as
defined in the Plans, of our ordinary shares at the date of grant. The term of
the options is between seven and ten years from the date of grant. Unless
otherwise provided in each option agreement, all granted options issued prior to
December 31, 2001 become exercisable in three equal annual installments.
Commencing January 1, 2002, all granted options will become exercisable in five
equal installments commencing on the first anniversary of the grant date, except
for annual grants of 2,000 to each director, which are fully exercisable on the
date of grant. Total options authorized under the Plans are 3,750,000.

     In prior years, we adopted the provisions of APB Opinion No. 25,
"Accounting for Stock Issued to Employees," and related interpretations in
accounting for employee stock options. Since the exercise price of the stock
options equals or exceeds the market price of the underlying stock on the date
of grant, no compensation expense was recognized.

     In December 2002, the Financial Accounting Standards Board issued SFAS
No.148, "Accounting for Stock-Based Compensation - Transition and Disclosure, an
Amendment of FASB Statement No. 123". Effective January 1, 2003, we have adopted
the modified prospective method of fair value-based stock option expense
provisions of SFAS No. 123 as amended by SFAS No. 148. Compensation expense has
been recognized for all stock options granted since January 1, 2003. This has
resulted in a charge to income of $81,000 in the three and six month periods
ended June 30, 2003.

     Pro forma information regarding net income and earnings per share for all
outstanding stock options is required by SFAS No. 148 and has been determined as
if we accounted for all employee stock options under the fair value method of
that Statement.

     For purposes of pro forma disclosures, the estimated fair value of the
options is amortized to expense over the options' vesting period using the
Black-Scholes model. The Black-Scholes and Binomial option-pricing models were
developed for use in estimating the fair value of traded options that have no
vesting restrictions and are fully transferable. In addition, option valuation
models require the input of highly subjective assumptions including the expected
price volatility. Because our employee stock options have characteristics
significantly different from those of traded options, and because changes in the
subjective input assumptions can materially affect the fair value estimate, in
management's opinion, the existing models do not necessarily provide a reliable
single measure of the fair value of our employee stock options.


                                       15
<PAGE>

                     Scottish Annuity & Life Holdings, Ltd.
              Notes to Unaudited Consolidated Financial Statements
                                At June 30, 2003

     Our pro forma information is as follows:

<TABLE>
<CAPTION>
                                                  Three months    Three months     Six months      Six months
                                                      ended           ended           ended           ended
                                                  June 30, 2003   June 30, 2002   June 30, 2003   June 30, 2002
                                                  -------------   -------------   -------------   -------------
<S>                                                  <C>             <C>             <C>             <C>
Net income-- as reported ...................         $  7,872        $  7,849        $ 15,115        $ 12,847
Stock-based employee compensation cost, net
    of related tax effects, included in the
    determination of net income as reported                81            --                81            --
Stock-based employee compensation cost, net
    of related tax effects, that would have
    been included in the determination of
    net income if the fair value based
    method had been applied to all awards ..             (649)         (1,130)         (1,319)         (2,316)
                                                  -------------   -------------   -------------   -------------
Net income-- pro forma .....................         $  7,304        $  6,719        $ 13,877        $ 10,531
                                                  =============   =============   =============   =============
</TABLE>


<TABLE>
<CAPTION>
                                                  Three months    Three months     Six months      Six months
                                                      ended           ended           ended           ended
                                                  June 30, 2003   June 30, 2002   June 30, 2003   June 30, 2002
                                                  -------------   -------------   -------------   -------------
<S>                                                  <C>             <C>             <C>             <C>
   Basic earnings per ordinary share-- as
       reported................................      $  0.29         $  0.29         $  0.56         $  0.55
   Basic earnings per ordinary share-- pro
       forma...................................      $  0.27         $  0.25         $  0.52         $  0.45
   Diluted earnings per ordinary share-- as
       reported................................      $  0.28         $  0.28         $  0.53         $  0.51
   Diluted earnings per ordinary share-- pro
       forma...................................      $  0.26         $  0.24         $  0.49         $  0.42
</TABLE>


11.  Shareholders' equity

     On July 23, 2003, we completed a public offering of 9,200,000 ordinary
shares (which included an over-allotment option of 1,200,000 ordinary shares) at
an offering price of $20.75 per share in which we raised aggregate net proceeds
of $179.7 million ($19.66 per share after the underwriting discount). We have
used $30.0 million of these proceeds to repurchase 1,525,000 ordinary shares
from Pacific Life Insurance Company at a purchase price of $19.66 per share.
Other expenses of the offering are expected to be approximately $1.2 million.
The remainder of the proceeds will be used for general corporate purposes.


                                       16
<PAGE>


                     Scottish Annuity & Life Holdings, Ltd.
                Management's Discussion and Analysis of Financial
                       Condition and Results of Operations


Item 2. Management's Discussion and Analysis of Financial Condition and Results
        of Operations

General

     Scottish Annuity & Life Holdings, Ltd., which we call Scottish Annuity &
Life, is a holding company organized under the laws of the Cayman Islands with
its principal executive office in Bermuda. We are a reinsurer of life insurance,
annuities and annuity-type products. These products are written by life
insurance companies and other financial institutions located principally in the
United States, as well as around the world. We refer to this portion of our
business as Life Reinsurance North America. On December 31, 2001, we completed
the purchase of World-Wide Holdings Limited and its subsidiary World-Wide
Reassurance Company Limited. World-Wide Reassurance specializes in niche markets
in developed countries and broader life insurance markets in the developing
world. We refer to this portion of our business as Life Reinsurance
International. Life Reinsurance North America and Life Reinsurance International
together are a reporting operating segment. To a lesser extent, we directly
issue variable life insurance and variable annuities and similar products to
high net worth individuals and families for insurance, investment and estate
planning purposes. We refer to this portion of our business as Wealth
Management, which is another reportable operating segment. Other revenues and
expenses not related to Life Reinsurance or Wealth Management are reported in
the "Other" segment.

     All amounts are reported in thousands of United States dollars, except per
share amounts.

Revenues

     We derive revenue from four principal sources:

     o    premiums from reinsurance assumed on life business;

     o    fee income from our variable life insurance and variable annuity
          products and from financial reinsurance transactions;

     o    investment income from our investment portfolio; and

     o    realized gains and losses from our investment portfolio.

     Premiums from reinsurance assumed on life business are included in revenues
over the premium paying period of the underlying policies. When we acquire
blocks of in-force business, we account for these transactions as purchases, and
our results of operations include the net income from these blocks as of their
respective dates of acquisition. Reinsurance assumed on annuity business does
not generate premium income but generates investment income over time on the
assets we receive from the ceding company. We also earn fees in our financial
reinsurance transactions with U.S. insurance company clients. Because some of
these transactions do not satisfy the risk transfer rules for reinsurance
accounting, the premiums and benefits are not reported in the consolidated
statements of income. A deposit received on a funding agreement also does not
generate premium income but does create income to the extent we earn an
investment return in excess of our interest payment obligations thereon.

     In our Wealth Management business, when we sell a variable life insurance
policy or a variable annuity contract, we charge mortality, expense and
distribution risk fees that are based on total assets in


                                       17
<PAGE>

                     Scottish Annuity & Life Holdings, Ltd.
                Management's Discussion and Analysis of Financial
                       Condition and Results of Operations

each policyholder's separate account. In the case of variable life insurance
policies, we also charge a cost of insurance fee based on the amount necessary
to cover the death benefit under the policy.

     Our investment income includes interest earned on our fixed income
investments and income from funds withheld at interest under modified
coinsurance agreements. Under GAAP, because our fixed income investments are
held as available for sale, these securities are carried at fair value, and
unrealized appreciation and depreciation on these securities is not included in
investment income on our statements of income, but is included in comprehensive
income as a separate component of shareholders' equity. Realized gains and
losses include gains and losses on investment securities that we sell during a
period and write downs of securities deemed to be other than temporarily
impaired.

Expenses

     We have five principal types of expenses:

     o    claims and policy benefits under our reinsurance contracts;

     o    interest credited to interest sensitive contract liabilities;

     o    acquisition costs and other insurance expenses;

     o    operating expenses; and

     o    interest expense.

     When we issue a life reinsurance contract, we establish reserves for
benefits. These reserves are our estimates of what we expect to pay in claims
and policy benefits and related expenses under the contract or policy. From time
to time, we may also add to reserves if our experience leads us to believe that
benefit claims and expenses will ultimately be greater than the existing
reserve. We report the change in these reserves as an expense during the period
when the reserve or additional reserve is established.

     In connection with reinsurance of annuity and annuity-type products, we
record a liability for interest sensitive contract liabilities, which represents
the amount ultimately due to the policyholder. We credit interest to these
contracts each period at the rates determined in the underlying contract, and
the amount is reported as interest credited to interest sensitive contract
liabilities on our consolidated statements of income.

     A portion of the costs of acquiring new business, such as commissions,
certain internal expenses related to our policy issuance and underwriting
departments and some variable selling expenses are capitalized. The resulting
deferred acquisition costs asset is amortized over future periods based on our
expectations as to the emergence of future gross profits from the underlying
contracts. These costs are dependent on the structure, size and type of business
written. For certain products, we may retrospectively adjust our amortization
when we revise our estimate of current or future gross profits to be realized.
The effects of this adjustment are reflected in earnings in the period in which
we revise our estimate.

     Operating expenses consist of salary and salary related expenses, legal and
professional fees, rent and office expenses, travel and entertainment,
directors' expenses, insurance and other similar expenses, except to the extent
capitalized in deferred acquisition costs.

     Interest expense consists of interest charges on our borrowings.


                                       18
<PAGE>

                     Scottish Annuity & Life Holdings, Ltd.
                Management's Discussion and Analysis of Financial
                       Condition and Results of Operations

Factors affecting profitability

     We seek to generate profits from three principal sources. First, in our
Life Reinsurance business, we seek to receive reinsurance premiums and financial
reinsurance fees that, together with income from the assets in which those
premiums are invested, exceed the amounts we ultimately pay as claims and policy
benefits, acquisition costs and ceding commissions. Second, in our Wealth
Management business, we seek to generate fee income that will exceed the
expenses of maintaining and administering our variable life insurance and
variable annuity products. Third, within our investment guidelines, we seek to
maximize the return on our unallocated capital.

     The following factors affect our profitability:

     o    the volume of business we write;

     o    our ability to assess and price adequately for the risks we assume;

     o    the mix of different types of business that we reinsure, because
          profits on some kinds of business emerge later than on other types;

     o    our ability to manage our assets and liabilities to manage investment
          and liquidity risk;

     o    the level of fees that we charge on our Wealth Management contracts;
          and

     o    our ability to control expenses.

     In addition, our profits can be affected by a number of factors that are
not within our control. For example, movements in interest rates can affect the
volume of business that we write, the income earned from our investments, the
interest we credit on interest sensitive contracts, the level of surrender
activity on contracts that we reinsure and the rate at which we amortize
deferred acquisition costs. Other external factors that can affect profitability
include mortality experience that varies from our assumed mortality, changes in
regulation or tax laws, which may affect the attractiveness of our products or
the costs of doing business and changes in foreign currency exchange rates.

Critical Accounting Policies

     Financial Accounting Standard 60 applies to traditional life policies with
continuing premiums. For these policies, future benefits are estimated using a
net level premium method on the basis of actuarial assumptions as to mortality,
persistency and interest established at policy issue. Assumptions established at
policy issue as to mortality and persistency are based on anticipated
experience, which, together with interest and expense assumptions, provide a
margin for adverse deviation. Acquisition costs are deferred and recognized as
expense in a constant percentage of the gross premiums using these assumptions
established at issue. Should the liabilities for future policy benefits plus the
present value of expected future gross premiums for a product be insufficient to
provide for expected future benefits and expenses for that product, deferred
acquisition costs will be written off and thereafter, if required, a premium
deficiency reserve will be established by a charge to income. Changes in the
assumptions for mortality, persistency and interest could result in material
changes to the financial statements.

     Financial Accounting Standard 97 applies to investment contracts, limited
premium contracts, and universal life-type contracts. For investment and
universal life-type contracts, future benefit liabilities are held using the
retrospective deposit method, increased for amounts representing unearned


                                       19
<PAGE>

                     Scottish Annuity & Life Holdings, Ltd.
                Management's Discussion and Analysis of Financial
                       Condition and Results of Operations

revenue or refundable policy charges. Acquisition costs are deferred and
recognized as expense as a constant percentage of gross margins using
assumptions as to mortality, persistency, and expense established at policy
issue without provision for adverse deviation and are revised periodically to
reflect emerging actual experience and any material changes in expected future
experience. Liabilities and the deferral of acquisition costs are established
for limited premium policies under the same practices as used for traditional
life policies with the exception that any gross premium in excess of the net
premium is deferred and recognized into income as a constant percentage of
insurance in-force. Should the liabilities for future policy benefits plus the
present value of expected future gross premiums for a product be insufficient to
provide for expected future benefits and expenses for that product, deferred
acquisition costs will be written off and thereafter, if required, a premium
deficiency reserve will be established by a charge to income. Changes in the
assumptions for mortality, persistency, maintenance expense and interest could
result in material changes to the financial statements.

     The development of policy reserves and amortization of deferred acquisition
costs for our products requires management to make estimates and assumptions
regarding mortality, lapse, expense and investment experience. Such estimates
are primarily based on historical experience and information provided by ceding
companies. Actual results could differ materially from those estimates.
Management monitors actual experience, and should circumstances warrant, will
revise its assumptions and the related reserve estimates.

     In 2002, we completed the acquisition of an in-force block of business. The
determination of the fair value of the assets acquired and the liabilities
assumed required management to make estimates and assumptions regarding
mortality, lapse and expenses. These estimates were based on historical
experience, actuarial studies and information provided by the ceding company.
Actual results could differ materially from these estimates.

     Present value of in-force business is established upon the acquisition of a
subsidiary and is amortized over the expected life of the business at the time
of acquisition. The amortization each year will be a function of the gross
profits or revenues each year in relation to the total gross profits or revenues
expected over the life of business, discounted at the assumed net credit rate.
The determination of the initial value and the subsequent amortization require
management to make estimates and assumptions regarding the future business
results that could differ materially from actual results. Estimates and
assumptions involved in the present value of in-force business and subsequent
amortization are similar to those necessary in the establishment of reserves and
amortization of deferred acquisition costs.

     Goodwill is established upon the acquisition of a subsidiary. Goodwill is
calculated as the difference between the price paid and the value of individual
assets and liabilities on the date of acquisition. In June 2001, the Financial
Accounting Standards Board issued SFAS No. 142, "Goodwill and Other Intangible
Assets," effective for fiscal years beginning after December 15, 2001. SFAS No.
142 requires that goodwill and intangible assets deemed to have indefinite lives
are no longer amortized but are subject to annual impairment tests in accordance
with the Statement. We applied the new rules on accounting for goodwill during
2002. Goodwill recognized in the consolidated balance sheet was assigned to
reporting units and has been tested for impairment at June 30, 2003. There has
been no impairment.

     Fixed maturity investments are evaluated for other than temporary
impairments in accordance with SFAS 115 and EITF 99-20. Under these
pronouncements, realized losses are recognized on securities if the securities
are determined to be other than temporarily impaired. Factors involved in the
determination of potential impairment include fair value as compared to cost,
length of time the value has


                                       20
<PAGE>

                     Scottish Annuity & Life Holdings, Ltd.
                Management's Discussion and Analysis of Financial
                       Condition and Results of Operations

been below cost, credit worthiness of the issuer, forecasted financial
performance of the issuer, position of the security in the issuer's capital
structure, the presence and estimated value of collateral or other credit
enhancement, length of time to maturity, interest rates and our intent and
ability to hold the security until the market value recovers.

     Our accounting policies addressing reserves, deferred acquisition costs,
value of business acquired, goodwill and investment impairment involve
significant assumptions, judgments and estimates. Changes in these assumptions,
judgments and estimates could create material changes in our consolidated
financial statements.

Results of Operations

Consolidated results of operations

<TABLE>
<CAPTION>
                                                          Three months      Three months     Six months      Six months
                                                              ended             ended           ended          ended
                                                          June 30, 2003     June 30, 2002   June 30, 2003  June 30, 2002
                                                          -------------     -------------   -------------  -------------
<S>                                                      <C>              <C>               <C>            <C>
Premiums earned........................................   $    94,737       $   37,628      $    159,556   $     68,983
Investment income, net.................................        35,941           26,136            68,245         47,867
Fee income.............................................         2,380            2,201             4,371          4,275
Realized losses........................................        (3,392)          (1,606)           (5,713)        (3,305)
                                                          -------------     -------------   -------------  -------------
Total revenues.........................................       129,666           64,359           226,459        117,820
                                                          -------------     -------------   -------------  -------------

Claims and other policy benefits.......................        65,676           26,656           108,570         50,543
Interest credited to interest sensitive contract               16,874           11,228            32,767         20,406
liabilities............................................
Acquisition costs and other insurance expenses, net....        27,884           12,040            48,539         22,869
Operating expenses.....................................         8,184            6,236            16,013         10,153
Interest expense.......................................         1,851              138             3,664            482
                                                          -------------     -------------   -------------  -------------
Total benefits and expenses............................       120,433           56,298           209,553        104,453
                                                          -------------     -------------   -------------  -------------
Net income before income taxes.........................         9,233            8,061            16,906         13,367
Income tax expense (benefit)...........................           (84)             121               166            429
                                                          -------------     -------------   -------------  -------------
Income from continuing operations......................         9,317            7,940            16,740         12,938
                                                          -------------     -------------   -------------  -------------
Loss from discontinued operations......................         1,445               91             1,625             91
                                                          -------------     -------------   -------------  -------------
Net income.............................................   $     7,872       $    7,849      $     15,115   $     12,847
                                                          =============     =============   =============  =============
</TABLE>

     Total revenues increased by 101% to $129.7 million in the second quarter of
2003 from $64.4 million in the same period of 2002. Total revenues increased by
92% to $226.5 million during the first six months of 2003 from $117.8 million in
the same period of 2002. Total revenues include premiums earned in our Life
Reinsurance operations, investment income on our invested assets, fee income on
our Life Reinsurance and Wealth Management operations and realized losses on our
investment portfolios. The increase in premiums earned is primarily due to
continued growth in our Life Reinsurance North America and Life Reinsurance
International segments. The increase in investment income is due to growth in
our invested assets, which arises from business growth, our equity offering in
April 2002 and our debt offerings in November and December 2002. Total benefits
and expenses increased by 114% to $120.4 million in the second quarter of 2003
from $56.3 million in the same period in 2002. Total benefits and expenses
increased by 101% to $209.6 million during the first six months of 2003 from
$104.5 million in the same period in 2002. The increase was due to continued
growth in our Life Reinsurance North America and Life Reinsurance International
segments, additional operating costs



                                       21
<PAGE>

                     Scottish Annuity & Life Holdings, Ltd.
                Management's Discussion and Analysis of Financial
                       Condition and Results of Operations

required to meet the growth in our business and additional interest expense
arising from the debt issuance in November and December 2002.

     During the period ended June 30, 2003 we decided to discontinue our Wealth
Management operations in Luxembourg. We are in the process of transferring our
Luxembourg Wealth Management business to third parties and expect to complete
the closure of this office by December 31, 2003. We have reported the results of
the Luxembourg Wealth Management activities as discontinued operations. During
the quarter ended June 30, 2003 losses from these operations amounted to $1.4
million ($0.05 per diluted share) in comparison with $91,000 in the prior year
period. The losses recorded in the current quarter include the write down of a
deferred tax asset of $349,000, which had arisen from prior year net operating
losses, and estimates of severance costs and costs to close the operation.
Losses incurred in respect of these operations in the six month period ended
June 30, 2003 and 2002 amounted to $1.6 million ($0.06 per diluted share) and
$91,000, respectively.

Earnings per ordinary share

<TABLE>
<CAPTION>
                                           Three months   Three months     Six months     Six months
                                               ended          ended          ended          ended
                                             June 30,       June 30,       June 30,        June 30,
                                               2003           2002            2003            2002
                                           ------------   ------------   ------------   ------------

<S>                                        <C>            <C>            <C>            <C>
   Income from continuing operations            $9,317         $7,940        $16,740        $12,938
                                           ============   ============   ============   ============
   Net income.............................      $7,872         $7,849        $15,115        $12,847
                                           ============   ============   ============   ============
   Earnings per ordinary share from
   continuing operations -Basic...........      $ 0.34         $ 0.30        $  0.62        $  0.55
                                           ============   ============   ============   ============
   Earnings per ordinary share from
   continuing operations - Diluted........      $ 0.33         $ 0.28        $  0.59        $  0.52
                                           ============   ============   ============   ============
   Basic earnings per ordinary share......      $ 0.29         $ 0.29        $  0.56        $  0.55
                                           ============   ============   ============   ============
   Diluted earnings per ordinary share....      $ 0.28         $ 0.28        $  0.53        $  0.51
                                           ============   ============   ============   ============
   Weighted average number of
   ordinary shares outstanding:
   Basic..................................  27,101,357     26,683,204     27,038,103     23,432,731
                                           ============   ============   ============   ============
   Diluted................................  28,587,540     28,504,230     28,371,379     24,946,671
                                           ============   ============   ============   ============
</TABLE>

     Net income from continuing operations for the second quarter increased 17%
to $9.3 million from $7.9 million in the same quarter in 2002. Net income from
continuing operations for the first six months increased 25% to $16.7 million
from $13.4 million in the same period in 2002. The increase is attributable to
continued growth in our Life Reinsurance North America and Life Reinsurance
International operations. Diluted earnings per ordinary share from continuing
operations amounted to $0.33 for the quarter ended June 30, 2003 and $0.28 per
ordinary share in the prior year period, an increase of 18%. For the six month
period, diluted earnings per ordinary share increased by 13% to $0.59. Diluted
earnings per ordinary share amounted to $0.28 for the second quarter of 2003 and
2002. Diluted earnings per ordinary share for the quarter increased for the
reasons discussed above. This increase was offset by increased realized losses
and the loss from discontinued operations. Diluted earnings per ordinary share
amounted to $0.54 for the first six months of 2003 and $0.51 in the same period
in 2002, an increase of 6%. Diluted earnings per ordinary share in the six month
period ended June 30, 2003 increased as a result of the growth in net income
discussed above. This increase was offset by an increase in the number of
ordinary shares outstanding mainly due to the public offering of 6,750,000
ordinary shares in April 2002.


                                       22
<PAGE>

                     Scottish Annuity & Life Holdings, Ltd.
                Management's Discussion and Analysis of Financial
                       Condition and Results of Operations

Premiums earned

     Premiums earned during the three months ended June 30, 2003 increased by
152% to $94.7 million from $37.6 million in the same period in the prior year.
Premiums earned during the six months ended June 30, 2003 increased by 131% to
$159.6 million from $70.0 million in the same period in the prior year.

     Premiums earned in our Life Reinsurance North America segment during the
three month period ended June 30, 2003 increased 142% to $56.6 million in
comparison with $23.4 million in the three month period ended June 30, 2002.
Premiums earned in this segment during the first six months increased 126% to
$96.0 million in comparison with $42.5 million in the six month period ended
June 30, 2002. The increase is due to increases in the amounts of life insurance
in-force on existing treaties and on new business written during the quarter. As
of June 30, 2003, we reinsured approximately $90.4 billion of life insurance
in-force on 1,787,000 lives. During the June quarter of 2003, we added $16.2
billion of in-force in comparison with $6.7 billion in the prior year period. In
the six months ended June 30, 2003, we added $22.2 billion of in-force in
comparison with $14.1 billion in the prior year period. Our average benefit
coverage per life was $51,000. As of June 30, 2002 we reinsured approximately
$49.0 billion of life insurance in-force on 1,252,000 lives. Our average benefit
coverage per life was $39,000.

     Premiums earned in our Life Reinsurance International segment during the
second quarter increased 168% to $38.2 million in comparison with $14.2 million
in the three month period ended June 30, 2002. Premiums earned in this segment
during the first six months increased 140% to $63.5 million in comparison with
$26.5 million in the six month period ended June 30, 2002. Our Life Reinsurance
International segment completed the acquisition of an in-force reinsurance
transaction effective from October 1, 2002. This transaction has contributed
$8.7 million to premiums earned during the current quarter and $13.6 million
during the first six months of 2003. Premiums earned on other life business
increased by $11.1 million during the current quarter and $17.4 million in the
first six months of 2003 in comparison with prior periods in 2002. The increase
is due to an increase in the number of contracts from 1,387 at June 30, 2002 to
1,729 at June 30, 2003. Premiums earned on aircrew "loss of license" insurance
increased by $3.9 million during the current quarter quarter and $5.8 million in
the first six months of 2003 in comparison with the prior year periods in 2002
due to new business. At June 30, 2003, there were 216 in-force contracts of
which 78 incepted during the six-month period ended June 30, 2003.

Fee income

     Both Life Reinsurance and Wealth Management operations generate fee income.
We earn fees in Life Reinsurance on certain of our financial reinsurance
treaties that do not qualify under risk transfer rules for reinsurance
accounting.

  Fee income is as follows:

<TABLE>
<CAPTION>
                                           Three months   Three months    Six months     Six months
                                              ended          ended          ended          ended
                                             June 30,       June 30,       June 30,       June 30,
                                              2003            2002           2003           2002
                                           ------------   ------------   ------------   -----------
<S>                                          <C>             <C>            <C>            <C>
Life Reinsurance North America...........     $1,337         $1,316         $2,396         $2,609
Wealth Management........................      1,043            885          1,975          1,666
                                           ------------   ------------   ------------   -----------
                                              $2,380         $2,201         $4,371         $4,275
                                           ============   ============   ============   ===========
</TABLE>


                                       23
<PAGE>

                     Scottish Annuity & Life Holdings, Ltd.
                Management's Discussion and Analysis of Financial
                       Condition and Results of Operations

     Wealth Management fees increased by 18% to $1.0 million during the three
month period ended June 30, 2003 and by 19% to $2.0 million during the six month
period ended June 30, 2003. The growth in fees is principally due to the growth
in segregated account balances, which is due to an increase in the number of
clients and improved investment performance. The number of clients has grown
from 140 at June 30, 2002 to 177 at June 30, 2003. Segregated assets amount to
$723.9 million at June 30, 2003 in comparison to $573.1 million at June 30,
2002. Policy face amounts amounted to $1.1 billion and $914.6 million at June
30, 2003 and 2002, respectively.

     The change in the segregated assets is as follows:


<TABLE>
<CAPTION>
                                       Three months    Three months      Six months      Six months
                                           ended           ended          ended           ended
                                       June 30, 2003   June 30, 2002   June 30, 2003   June 30, 2002
                                       -------------   -------------   -------------   -------------
<S>                                     <C>             <C>             <C>             <C>
 Balance at beginning of period.....    $  669,644      $  603,600      $  653,588      $  602,800
 Deposits...........................        16,712           7,607          66,739          11,807
 Withdrawals........................        (3,484)              -         (10,168)           (650)
 Investment performance.............        41,034         (38,052)         13,747         (40,802)
                                       -------------   -------------   -------------   -------------
 Balance at end of period...........    $  723,906      $  573,155      $  723,906      $  573,155
                                       =============   =============   =============   =============
</TABLE>


Investment income

     Net investment income increased by $9.7 million or 38% to $35.9 million for
the three months ended June 30, 2003 from $26.1 million for the prior year
period. Net investment income increased by $20.3 million or 43% to $68.2 million
for the six months ended June 30, 2003 from $47.9 million for the prior year
period. The increase is due to the growth in our average invested assets offset
in part by decreases in realized yields during 2002 and 2003. Our total invested
assets have increased significantly because of growth in our Life Reinsurance
North America operations and investment of the proceeds of our equity offering
in April 2002 and our convertible debt and capital securities offerings in
November and December 2002. Total invested assets have increased from $1.7
billion at June 30, 2002 to $2.7 billion at June 30, 2003. Funds withheld at
interest grew from $879.6 million at June 30, 2002 to $1.2 billion at June 30,
2003.

     During the six month period ended June 30, 2003, average book yields were
lower than in the same period in 2002. On the $1.4 billion portfolio managed by
our external investment managers the yields on fixed rate assets were 5.4% and
6.3% at June 30, 2003 and 2002, respectively. The reduction in yield was due
primarily to the much lower market yields at which new cash flows were invested
and proceeds of maturities and sales were reinvested. Yields on floating rate
assets are indexed to LIBOR. The yield on our floating rate assets decreased to
3.2% from 3.7%, and the yield on our cash and cash equivalents decreased to 1.6%
from 1.8%. The volume of floating rate assets increased during 2002 as a result
of our investing the proceeds of a $100 million floating rate funding agreement
to earn a spread over the cost of funds.


                                       24
<PAGE>

                     Scottish Annuity & Life Holdings, Ltd.
                Management's Discussion and Analysis of Financial
                       Condition and Results of Operations

The analysis of investment income by segment is as follows:

<TABLE>
<CAPTION>
                                       Three months    Three months      Six months      Six months
                                           ended           ended           ended           ended
                                       June 30, 2003   June 30, 2002   June 30, 2003   June 30, 2002
                                       -------------   -------------   -------------   -------------
<S>                                     <C>             <C>             <C>             <C>
 Life Reinsurance  - North America.....  $   32,680      $   23,157      $   62,280      $   42,683
                   - International.....       2,125           1,705           3,851           3,108
 Wealth Management.....................          60             (46)             94            (129)
 Other.................................       1,076           1,320           2,020           2,205
                                       -------------   -------------   -------------   -------------
 Total.................................  $   35,941      $   26,136      $   68,245      $   47,867
                                       =============   =============   =============   =============
</TABLE>

Realized losses

     During the three months ended June 30, 2003, realized losses amounted to
$3.4 million in comparison with $1.6 million in 2002. During the six months
ended June 30, 2003, realized losses amounted to $5.7 million in comparison with
$3.3 million in 2002.

     During the quarter ended June 30, 2003, we recognized $0.5 million losses
in respect of "other than temporary impairments" on investments. During the six
month period, these losses amounted to $1.7 million. There were no "other than
temporary impairment" losses recognized during the first six months of 2002.
These losses include "other than temporary impairment losses" notified by ceding
companies on contracts written on a modified coinsurance basis. They are stated
net of the related deferred acquisition costs. Management reviews securities
with material unrealized losses and tests for "other than temporary impairments"
on a quarterly basis. Factors involved in the determination of impairment
include fair value as compared to amortized cost, length of time the value has
been below amortized cost, credit worthiness of the issuer, forecasted financial
performance of the issuer, position of the security in the issuer's capital
structure, the presence and estimated value of collateral or other credit
enhancement, length of time to maturity, interest rates and our intent and
ability to hold the security until the market value recovers. We review all
investments with fair values less than amortized cost, and pay particular
attention to those that have traded continuously at less than 80% of amortized
cost for at least six months or 90% of amortized cost for at least 12 months and
other assets with material differences between amortized cost and fair value.
Investments meeting those criteria are analyzed in detail for "other than
temporary impairment." When a decline is considered to be "other than temporary"
a realized loss is incurred and the cost basis of the impaired asset is adjusted
to its fair value.

     Under EITF 99-20, "Recognition of Interest Income and Impairment on
Purchased and Retained Beneficial Interest in Securitized Assets", a decline in
fair value below "amortized cost" basis is considered to be an "other than
temporary impairment" whenever there is an adverse change in the amount or
timing of cash flow to be received, regardless of the resulting yield, unless
the decrease is solely a result of changes in market interest rates. During the
quarter ended June 30, 2003, we recognized $1.7 million in respect of EITF 99-20
losses in comparison with $1.0 million in the prior year period. During the
six month period ended June 30, 2003, these losses amounted to $2.4 million in
comparison with $1.9 million for the same period in 2002.

     The impairment losses discussed above have been partially offset by net
realized gains on the disposals of fixed maturity investments.


                                       25
<PAGE>

                     Scottish Annuity & Life Holdings, Ltd.
                Management's Discussion and Analysis of Financial
                       Condition and Results of Operations

     The following tables provide details of the sales proceeds, realized loss,
the length of time the security had been in an unrealized loss position and
reason for sale for securities sold at a loss during the periods ended June 30,
2003 and 2002.

<TABLE>
<CAPTION>
                                       Three months ended June 30, 2003
                  --------------------------------------------------------------------------
                       Credit Concern                Other                    Total
                  ----------------------- ------------------------ -------------------------
Days               Proceeds       Loss       Proceeds       Loss      Proceeds       Loss
                  ----------- ----------- ------------- ---------- ------------ ------------
                                           (dollars in thousands)
<S>               <C>          <C>          <C>          <C>         <C>          <C>
0-90..........    $     --     $     --     $  2,476     $     (3)   $  2,476     $     (3)
91-180........         739          (11)          --           --         739          (11)
                  ----------- ----------- ------------- ---------- ------------ ------------
Total.........    $    739     $    (11)    $  2,476     $     (3)   $  3,215     $    (14)
                  =========== =========== ============= ========== ============ ============
</TABLE>


<TABLE>
<CAPTION>
                                       Three months ended June 30, 2002
                  --------------------------------------------------------------------------
                       Credit Concern                Other                    Total
                  ----------------------- ------------------------ -------------------------
Days               Proceeds       Loss       Proceeds       Loss      Proceeds       Loss
                  ----------- ----------- ------------- ---------- ------------ ------------
                                           (dollars in thousands)
<S>               <C>          <C>          <C>          <C>         <C>          <C>
0-90..........    $  7,131     $   (161)    $  4,337     $    (20)   $ 11,468     $   (181)
91-180........         996          (54)                                  996          (54)
Greater than 360       658          (98)          --           --         658          (98)
                  ----------- ----------- ------------- ---------- ------------ ------------
Total.........    $  8,785     $   (313)    $  4,337     $    (20)   $ 13,122     $   (333)
                  =========== =========== ============= ========== ============ ============
</TABLE>


<TABLE>
<CAPTION>
                                       Six months ended June 30, 2003
                  --------------------------------------------------------------------------
                       Credit Concern                Other                    Total
                  ----------------------- ------------------------ -------------------------
Days               Proceeds       Loss       Proceeds       Loss      Proceeds       Loss
                  ----------- ----------- ------------- ---------- ------------ ------------
                                           (dollars in thousands)
<S>               <C>          <C>          <C>          <C>         <C>          <C>
0-90..........    $            $     --     $  2,476     $     (3)   $  2,476     $     (3)
91-180........       3,429         (212)          --           --       3,429         (212)
181-270.......       1,200         (241)          --           --       1,200         (241)
Greater than 360     1,474          (13)          --           --       1,474          (13)
                  ----------- ----------- ------------- ---------- ------------ ------------
Total.........    $  6,103     $   (466)    $  2,476     $     (3)   $  8,579     $   (469)
                  =========== =========== ============= ========== ============ ============
</TABLE>


<TABLE>
<CAPTION>
                                       Six months ended June 30, 2002
                  --------------------------------------------------------------------------
                       Credit Concern                Other                    Total
                  ----------------------- ------------------------ -------------------------
Days               Proceeds       Loss       Proceeds       Loss      Proceeds       Loss
                  ----------- ----------- ------------- ---------- ------------ ------------
                                           (dollars in thousands)
<S>               <C>          <C>          <C>          <C>         <C>          <C>
0-90..........    $ 10,688     $   (587)    $  8,442     $    (38)   $ 19,130     $   (625)
91-180........       2,949         (199)       2,044          (45)      4,993         (244)
Greater than 360       658          (98)          --           --         658          (98)
                  ----------- ----------- ------------- ---------- ------------ ------------
Total.........    $ 14,295     $   (884)    $ 10,486     $    (83)   $ 24,781     $   (967)
                  =========== =========== ============= ========== ============ ============
</TABLE>


                                       26
<PAGE>

                     Scottish Annuity & Life Holdings, Ltd.
                Management's Discussion and Analysis of Financial
                       Condition and Results of Operations

     At December 31, 2002, we held unit-linked securities amounting to $16.5
million. These securities comprised investments in a unit trust denominated in
British pounds. These securities were acquired as part of the purchase of
World-Wide Holdings and were recorded at quoted market value. Changes in market
value were recorded as net realized gains or losses. During the quarter ended
June 30, 2003, we novated our liabilities on our unit-linked contracts as
discussed in "Claims and Other Policy Benefits". The liabilities were settled by
transferring a portion of the unit-linked securities to the original ceding
company. The remaining unit-linked securities were sold realizing a gain of $0.3
million during the quarter. During the quarter ended June 30, 2002 and the six
month periods ended June 30, 2003 and 2002, changes in market value of those
securities of $0.3 million, $0.9 million and $2.4 million, respectively, were
recognized as realized losses.

Claims and other policy benefits

     Claims and other policy benefits increased by 146% to $65.7 million in the
three month period ended June 30, 2003 in comparison with $26.7 million in the
prior year period. Claims and other policy benefits increased by 115% to $108.6
million in the six month period ended June 30, 2003 in comparison with $50.5
million in the prior year period.

     Claims and other policy benefits in our Life Reinsurance North America
segment increased by 144% to $42.8 million in the three month period ended June
30, 2003 from $17.5 million in the same quarter in 2002. Claims and other policy
benefits in our Reinsurance North America segment increased by 118% to $72.2
million in the six month period ended June 30, 2003 from $33.1 million in the
same quarter in 2002. The increase is as a result of the increased number of
clients and the increase in our traditional solutions business from these
clients in our Life Reinsurance North America operations as previously
described. Death claims are reasonably predictable over a period of many years,
but are less predictable over shorter periods and are subject to fluctuation
from quarter to quarter.

     Claims and other policy benefits in our Life Reinsurance International
segment increased by 150% to $22.9 million in the three month period ended June
30, 2003 from $9.1 million in the same quarter in 2002. Claims and other policy
benefits in our Life Reinsurance International segment increased by 109% to
$36.3 million in the six month period ended June 30, 2003 from $17.4 million in
the same quarter in 2002. The increase is a result of the increased volume of
business, as previously described, together with the acquisition of an in-force
block of business with effect from October 2002 on which claims amounted to $4.9
million for the quarter and $6.7 million during the first six months of 2003.

     Our targeted maximum corporate retention in our Life Reinsurance North
America segment operations on any one life is $1 million, however, we currently
retrocede any liability in excess of $500,000. Our maximum retention per life in
our Life Reinsurance International segment is $250,000. We have also arranged
catastrophe cover, which provides reinsurance for losses of approximately $11.0
million in excess of $1.0 million. This catastrophe cover provides protection
for terrorism, nuclear, biological and chemical risks.

     During the quarter ended June 30, 2003, we entered into an agreement to
novate our unit-linked liabilities. The outstanding liabilities were settled by
transferring an agreed number of unit-linked securities to the counter-party to
the novation agreement. The settlement was less than the liability previously
recorded at March 31, 2003 of $15.5 million and therefore resulted in a release
of liabilities of $3.4 million.


                                       27
<PAGE>

                     Scottish Annuity & Life Holdings, Ltd.
                Management's Discussion and Analysis of Financial
                       Condition and Results of Operations

Interest credited to interest sensitive contract liabilities

     For the three months ended June 30, 2003, interest credited to interest
sensitive contract liabilities increased by $5.6 million or 50% to $16.9 million
from $11.2 million in the same period in 2002. For the six months ended June 30,
2003, interest credited to interest sensitive contract liabilities increased by
$12.4 million or 61% to $32.8 million from $20.4 million in the same period in
2002. Interest credited includes interest in respect of a funding agreement for
$100 million that we wrote in June 2002. The amount due on this funding
agreement is included in interest sensitive contract liabilities on our balance
sheet. The remaining increase is due to interest credited on new 2002
reinsurance treaties and increases in interest credited on treaties, which
commenced in prior years, due to increasing average liability balances. Interest
sensitive contract liabilities amounted to $1.9 billion in comparison with $1.1
billion at June 30, 2002.

Acquisition costs and other insurance expenses

     During the three month period ended June 30, 2003, acquisition costs and
other insurance expenses increased by $15.9 million or 132% to $27.9 million
from $12.0 million in the same period in 2002. During the six month period ended
June 30, 2003, acquisition costs and other insurance expenses increased by $25.7
million or 112% to $48.5 million from $22.9 million in the same period in 2002.
The increase was a result of the increased life and annuity business in our Life
Reinsurance North America segment and, as discussed above, the acquisition of
the block of business in our Life Reinsurance International segment with effect
from October 2002 which added $1.9 million for the current quarter and $3.5
million during the first six months of 2003 to acquisition expenses. The
increase was also a result of growth in the other business lines in our Life
Reinsurance International segment, as described above. Acquisition costs also
includes the amortization of the present value of in-force business. As a result
of the novation of the unit linked contract liabilities (as described in "Claims
and Other Policy Benefits") the present value of the in-force on this business
was fully amortized during the current quarter resulting in an additional charge
of $1.9 million.

 The components of these expenses are as follows:

<TABLE>
<CAPTION>
                                       Three months    Three months      Six months      Six months
                                           ended           ended           ended           ended
                                       June 30, 2003   June 30, 2002   June 30, 2003   June 30, 2002
                                       -------------   -------------   -------------   -------------
<S>                                     <C>             <C>             <C>             <C>
 Commissions, excise taxes &
 other insurance expenses..........      $  54,006       $  30,363       $  91,286       $  57,881
 Deferral of expenses..............        (41,147)        (27,028)        (67,929)        (49,688)
                                       -------------   -------------   -------------   -------------
                                            12,858           3,335          23,357           8,193
 Amortization - Present value
 of in-force business..............          2,572             359           3,595           1,080
 Amortization -- Deferred
 acquisition costs.................         12,454           8,346          21,587          13,596
                                       -------------   -------------   -------------   -------------
 Total.............................      $  27,884       $  12,040       $  48,539       $  22,869
                                       =============   =============   =============   =============
</TABLE>

     Commissions and excise taxes vary with premiums earned. Other insurance
expenses include direct and indirect expenses of those departments involved in
the marketing, underwriting and issuing of reinsurance treaties. Of these total
expenses a portion is deferred and amortized over the life of the reinsurance
treaty or, in the case of interest sensitive contracts, in relation to the
estimated gross profit in respect of the contracts.


                                       28
<PAGE>

                     Scottish Annuity & Life Holdings, Ltd.
                Management's Discussion and Analysis of Financial
                       Condition and Results of Operations

     The analysis of acquisition costs and other insurance expenses by segment
is as follows:

<TABLE>
<CAPTION>
                                      Three months    Three months      Six months      Six months
                                          ended           ended           ended           ended
                                      June 30, 2003   June 30, 2002   June 30, 2003   June 30, 2002
                                      -------------   -------------   -------------   -------------
<S>                                      <C>              <C>             <C>              <C>
Life Reinsurance   - North America....   $19,815          $10,952         $34,267          $19,675
                   - International....     7,690              139          13,221            1,674
Wealth Management.....................       379              949           1,051            1,513
Other.................................         -                -               -                7
                                      -------------   -------------   -------------   -------------
Total.................................   $27,884          $12,040         $48,539          $22,869
                                      =============   =============   =============   =============
</TABLE>


Operating expenses

     Operating expenses increased to $8.1 million for the second quarter of 2003
compared to $6.2 million in the second quarter of 2002. Operating expenses
increased to $16.0 million for the first six months of 2003 compared to $10.2
million for the first six months in 2002. The split of these expenses between
segments is as follows:

<TABLE>
<CAPTION>
                                      Three months    Three months      Six months      Six months
                                          ended           ended           ended           ended
                                      June 30, 2003   June 30, 2002   June 30, 2003   June 30, 2002
                                      -------------   -------------   -------------   -------------
<S>                                      <C>              <C>             <C>              <C>
Life Reinsurance - North America......    $2,372           $1,772         $ 4,415          $ 2,697
                 - International......     3,292            1,767           5,840            3,454
Wealth Management.....................       193              377             355              587
Other.................................     2,291            2,320           5,403            3,415
                                      -------------   -------------   -------------   -------------
Total.................................    $8,148           $6,236         $16,013          $10,153
                                      =============   =============   =============   =============
</TABLE>

     The increase in operating expenses is due to increased personnel and other
costs as we continued to grow our business. During 2002 and the first quarter of
2003, we continued to complete the staffing of our principal office in Bermuda.
Total employees in our operations, including World-Wide, have grown from 102 at
June 30, 2002 to 137 at June 30, 2003. The number of employees in our Life
Reinsurance International segment has grown from 38 at June 30, 2002 to 54 at
June 30, 2003. This growth has resulted in additional costs for office running
expenses. In 2003, we have experienced increased compensation costs for our
Board of Directors, increased legal and professional fees arising as a result of
corporate governance legislation, and have also incurred additional costs for
director's and officers insurance. Our operations are geographically diverse
with offices in Bermuda, the Cayman Islands, Charlotte, Dallas, Dublin and
Windsor. With the growth of our business operations, we have incurred additional
travel, technology and communication expenses.

Interest expense

     We incurred interest expense of $1.9 million during the second quarter of
2003 in comparison with $0.1 million during the second quarter of 2002. We
incurred interest expense of $3.7 million during the first six months of 2003 in
comparison with $0.5 million during the same period in 2002. Interest expense
this quarter comprises of interest on the $115.0 million of convertible debt
issued in November 2002 and the $17.5 million capital securities issued in
December 2002. Interest expense in the first six months of 2002 was in respect
of borrowings under our credit facility. These borrowings were repaid in April
2002.


                                       29
<PAGE>

                     Scottish Annuity & Life Holdings, Ltd.
                Management's Discussion and Analysis of Financial
                       Condition and Results of Operations

Financial Condition

Investments

     At June 30, 2003, the portfolio controlled by us consisted of $1.5 billion
of traded fixed income securities, traded preferred stock and cash. Of this
total, $1.4 billion represented the fixed income and preferred stock portfolios
managed by external investment managers and $109.0 million represented other
cash balances. At June 30, 2003, the average Standard & Poor's rating of that
portfolio was "A+", the average effective duration was 3.47 years and the
average book yield was 4.88% as compared with an average rating of "AA-", an
average effective duration 3.03 years and an average book yield of 4.93 % at
December 31, 2002. At June 30, 2003, the unrealized appreciation on investments,
net of tax, was $28.4 million as compared with $8.9 million at December 31,
2002. The unrealized appreciation on investments is included in our consolidated
balance sheet as part of shareholders' equity.

     At December 31, 2002, the portfolio controlled by us consisted of $1.1
billion of traded fixed income securities and cash. Of this total, $1.0 billion
represented the fixed income portfolio managed by external investment managers,
and $131.0 million represented other cash balances.

     In the table below are the total returns earned by our portfolio for the
six months ended June 30, 2003, compared to the returns earned by three indices:
the Lehman Brothers Global Bond Index, the S&P 500, and a customized index that
we developed with General Re New England Asset Management ("NEAM"), an external
investment manager, to take into account our investment guidelines. We believe
that this customized index is a more relevant benchmark for our portfolio's
performance.

                                                         June 30, 2003
                                                         -------------
    Portfolio performance.............................       3.66%
    Customized index..................................       3.76%
    Lehman Brothers Global Bond Index.................       5.13%
    S&P 500...........................................      11.76%

     The following table presents the investment portfolio (market value) credit
exposure by category as assigned by Standard & Poor's.

<TABLE>
<CAPTION>
                                                               June 30, 2003          December 31, 2002
                                                           --------------------    -----------------------
     Ratings                                                $ in                       $ in
                                                           millions         %       millions          %
                                                          ---------   ---------    ---------    ---------
<S>                                                       <C>             <C>      <C>              <C>
     AAA.............................................     $   441.5       30.4%    $   405.7        35.8%
     AA..............................................         156.6       10.8         113.4        10.0
     A...............................................         443.6       30.6         335.3        29.5
     BBB.............................................         384.1       26.5         252.4        22.2
     BB or below.....................................          25.1        1.7          28.1         2.5
                                                          ---------   ---------    ---------    ---------
     Total...........................................     $ 1,450.9      100.0%    $ 1,134.9       100.0%
                                                          =========   =========    =========    =========
</TABLE>


                                       30
<PAGE>

                     Scottish Annuity & Life Holdings, Ltd.
                Management's Discussion and Analysis of Financial
                       Condition and Results of Operations

     The following table illustrates the investment portfolio (market value)
sector exposure.

<TABLE>
<CAPTION>
                                                               June 30, 2003         December 31, 2002
                                                           --------------------   -----------------------
     Sector                                                  $ in                    $ in
                                                           millions         %       millions          %
                                                          ---------   ---------    ---------    ---------
<S>                                                          <C>         <C>       <C>            <C>
        U.S. Treasury securities and U.S. government
            agency obligations..........................  $     9.2       0.6%     $    13.8         1.3%
        Corporate securities............................      727.2       50.1         549.9        48.5
        Municipal bonds.................................        3.0        0.2           1.7         0.1
        Mortgage and asset backed securities............      552.8       38.1         438.5        38.6
                                                          ---------   ---------    ---------    ---------
                                                            1,292.2       89.0       1,003.9        88.5
        Preferred stock.................................       49.7        3.5           -           -
        Cash............................................      109.0        7.5         131.0        11.5
                                                          ---------   ---------    ---------    ---------
        Total...........................................  $ 1,450.9      100.0%    $ 1,134.9       100.0%
                                                          =========   =========    =========    =========
</TABLE>

     The data in the tables above excludes unit-linked securities and assets
held by ceding insurers under modified coinsurance agreements.

     At June 30, 2003, our investment portfolio had 991 securities and $14.0
million of gross unrealized losses. No single position had an unrealized loss
greater than $1.8 million. There were $53.3 million of unrealized gains on the
remainder of the portfolio. At December 31, 2002, our investment portfolio had
617 securities and $16.1 million of gross unrealized losses. No single position
had an unrealized loss greater than $1.3 million.

     The composition by category of securities that have an unrealized loss at
June 30, 2003 and December 31, 2002 are presented in the tables below.

<TABLE>
<CAPTION>
                                                                               June 30, 2003
                                                          ------------------------------------------------------
                                                            Estimated                   Unrealized
                                                           Fair Value         %            Loss            %
                                                           ----------    ----------     ----------     ---------
                                                                            Dollars in thousands
<S>                                                       <C>               <C>        <C>                <C>
        Corporate securities..........................    $    43,008       18.9%      $   (2,468)        17.6%
        Municipal bonds...............................          1,441        0.6%            (158)         1.1%
        Collateralized mortgage obligations...........         48,087       21.2%            (473)         3.4%
        Mortgage backed securities....................         14,539        6.4%             (59)         0.4%
        Other structured securities...................        111,637       49.1%         (10,766)        76.7%
        Preferred stock...............................          8,591        3.8%            (116)         0.8%
                                                          -----------    ----------    -----------     ---------
                                                          $   227,303      100.0%      $  (14,040)       100.0%
                                                          ===========    ==========    ===========     =========
</TABLE>


<TABLE>
<CAPTION>
                                                                             December 31, 2002
                                                          ------------------------------------------------------
                                                            Estimated                   Unrealized
                                                           Fair Value         %            Loss            %
                                                           ----------    ----------     ----------     ---------
                                                                            Dollars in thousands
<S>                                                       <C>               <C>        <C>                <C>
        Corporate securities..........................    $    68,503       34.7%      $   (5,323)        33.0%
        Municipal bonds...............................          1,658        0.8               (1)        --
        Collateralized mortgage obligations...........         22,896       11.6             (608)         3.7
        Other structured securities...................        104,453       52.9          (10,213)        63.3
                                                          -----------    ----------    -----------     ---------
                                                          $   197,510      100.0%      $  (16,145)       100.0%
                                                          ===========    ==========    ===========     =========
</TABLE>


                                       31
<PAGE>

                     Scottish Annuity & Life Holdings, Ltd.
                Management's Discussion and Analysis of Financial
                       Condition and Results of Operations

     At June 30, 2003, there were 162 securities with unrealized loss positions
with two securities having losses greater than $1 million. These two securities
were securitized assets and were tested for impairment under EITF Issue No.
99-20. At June 30, 2003, both securities satisfied the impairment tests of EITF
99-20. At December 31, 2002, there were 114 securities with unrealized loss
positions with one security having an unrealized loss greater than $1 million.
This was also a securitized asset, was tested for impairment under EITF Issue
No. 99-20 and satisfied the impairment tests at December 31, 2002.

     The following tables provide information on the length of time securities
have been continuously in an unrealized loss position:

<TABLE>
<CAPTION>
                                                                   June 30, 2003
                                  -------------------------------------------------------------------------------
                                                              Estimated                  Unrealized
        Days                       Book Value        %       Fair Value        %           Loss            %
        ----                      ------------   ---------   ----------    ---------    ----------      --------
                                                                Dollars in thousands
<S>     <C>                       <C>              <C>       <C>               <C>      <C>                <C>
        0-90..................    $  105,392       46.4%     $  103,905        48.7%    $   (1,487)        10.6%
        91-180................        35,590       15.6%         34,735        16.3           (855)         6.1
        181-270...............         9,296        4.1%          7,315         3.4         (1,981)        14.1
        271-360...............        36,101       15.9%         32,963        15.5         (3,138)        22.4
        Greater than 360......        40,924       18.0%         34,345        16.1         (6,579)        46.8
                                  ----------   ---------     ----------    ---------    ----------      --------
        Total.................    $  227,303      100.0%     $  213,263       100.0%    $  (14,040)       100.0%
                                  ==========   =========     ==========    =========    ==========      ========

                                                                 December 31, 2002
                                  -------------------------------------------------------------------------------
                                                             Estimated                  Unrealized
        Days                       Book Value        %       Fair Value        %           Loss            %
        ----                      ------------   ---------   ----------    ---------    ----------      --------
                                                                Dollars in thousands
        0-90..................    $   81,724       38.3%     $   79,557        40.3%    $   (2,167)        13.4%
        91-180................        53,663       25.1          50,082        25.4         (3,581)        22.2
        181-270...............        21,621       10.1          17,759         9.0         (3,862)        23.9
        271-360...............         7,227        3.4           6,212         3.1         (1,015)         6.3
        Greater than 360......        49,420       23.1          43,900        22.2         (5,520)        34.2
                                  ----------   ---------    ----------    ---------    ----------      --------
        Total.................    $  213,655      100.0%     $  197,510       100.0%    $  (16,145)       100.0%
                                  ==========   =========     ==========    =========    ==========      ========
</TABLE>

     Unrealized losses on securities that have been in an unrealized loss
position for periods greater than 2 years amounted to $1.8 million and $1.3
million at June 30, 2003 and December 31, 2002, respectively. Unrealized losses
on non-investment grade securities amounted to $4.5 million and $3.8 million at
June 30, 2003 and December 31, 2002, respectively. Of these amounts
non-investment grade securities with unrealized losses of $1.8 million at June
30, 2003 and $1.6 million at December 31, 2002 had been in an unrealized loss
position for a period greater than one year, of which $215,000 at June 30, 2003
and $230,000 at December 31, 2002 had been in an unrealized loss position for
periods greater than 2 years.

     At June 30, 2003, there were ten securities with fair values that traded
continuously at less than 80% of amortized cost for at least six months or 90%
of amortized cost for at least 12 months. The total unrealized loss on these
securities amounted to $7.2 million and the largest unrealized loss position was
$1.6 million.


                                       32
<PAGE>

                     Scottish Annuity & Life Holdings, Ltd.
                Management's Discussion and Analysis of Financial
                       Condition and Results of Operations

     At December 31, 2002, there were five securities with fair values that
traded continuously at less than 80% of amortized cost for at least six months
or 90% of amortized cost for at least 12 months. The total unrealized loss on
these securities amounted to $1.1 million and the largest unrealized loss
position was $0.5 million.

     The following tables illustrate the industry analysis of the unrealized
losses at June 30, 2003 and December 31, 2002.

<TABLE>
<CAPTION>
                                                                        June 30, 2003
                                       --------------------------------------------------------------------------------
                                        Amortized                   Estimated                   Unrealized
                                           Cost           %         Fair Value        %            Loss           %
                                       -----------    ---------    ------------   ---------    -------------   --------
        Industry                                                      Dollars in thousands
<S>                                    <C>               <C>       <C>                <C>      <C>               <C>
        Mortgage & asset backed
           securities.............     $  174,262        76.7%     $  162,964         76.4%    $  (11,298)       80.5%
        Transportation............         11,672         5.1          10,083          4.7         (1,589)       11.3
        Banking...................          9,889         4.4           9,819          4.6            (70)        0.5
        Insurance.................          5,176         2.3           5,121          2.4            (55)        0.4
        Reits.....................          4,355         1.9           4,338          2.0            (17)        0.1
        Other.....................         21,949         9.6          20,938          9.9         (1,011)        7.2
                                       -----------    ---------    ------------   ---------    -------------   --------
        Total.....................     $  227,303       100.0%     $  213,263        100.0%    $  (14,040)      100.0%
                                       ===========    =========    ============   =========    =============   ========
</TABLE>


<TABLE>
<CAPTION>
                                                                     December 31, 2002
                                       --------------------------------------------------------------------------------
                                        Amortized                   Estimated                   Unrealized
                                           Cost           %         Fair Value        %            Loss           %
                                       -----------    ---------    ------------   ---------    -------------   --------
        Industry                                                      Dollars in thousands
<S>                                    <C>               <C>       <C>                <C>      <C>               <C>
        Mortgage & asset backed
           securities.............     $  139,830        65.5%     $  129,007         65.4%    $  (10,823)       67.1%
        Finance companies.........         16,967         7.9          16,637          8.4           (330)        2.0
        Transportation............          9,936         4.7           7,286          3.7         (2,650)       16.4
        Consumer cyclical.........          7,763         3.6           7,235          3.7           (528)        3.3
        Electric..................          7,130         3.3           6,767          3.4           (363)        2.2
        Other.....................         32,029        15.0          30,578         15.4         (1,451)        9.0
                                       -----------    ---------    ------------   ---------    -------------   --------
        Total.....................     $  213,655       100.0%     $  197,510        100.0%      $(16,145)      100.0%
                                       ===========    =========    ============   =========    =============   ========
</TABLE>
-------------------
Other industries each represent less than 2% of estimated fair value.


                                       33

<PAGE>

                     Scottish Annuity & Life Holdings, Ltd.
                Management's Discussion and Analysis of Financial
                       Condition and Results of Operations

     The expected maturity dates of securities that have an unrealized loss at
June 30, 2003 and December 31, 2002 are presented in the table below.

<TABLE>
<CAPTION>
                                                                         June 30, 2003
                                       --------------------------------------------------------------------------------
                                        Amortized                   Estimated                   Unrealized
                                           Cost           %         Fair Value        %            Loss           %
                                       -----------    ---------    ------------   ---------    -------------   --------
Maturity                                                              Dollars in thousands
<S>                                     <C>             <C>         <C>            <C>         <C>             <C>
Due in one year or less.............    $  45,400        20.0%      $   44,263      20.8%          (1,137)       8.1%
Due in one through five years.......      112,976        49.7          105,776      49.6           (7,200)      51.3
Due in five through ten years.......       63,480        27.9           57,904      27.1           (5,576)      39.7
Due after ten years.................        5,447         2.4            5,320       2.5             (127)       0.9
                                       -----------    ---------    ------------   ---------    -------------   --------
Total...............................    $ 227,303       100.0%      $  213,263     100.0%      $  (14,040)     100.0%
                                       ===========    =========    ============   =========    =============   ========
</TABLE>



<TABLE>
<CAPTION>
                                                                       December 31, 2002
                                       -------------------------------------------------------------------------------
                                           Book                     Estimated                   Unrealized
                                           Value          %         Fair Value        %            Loss           %
                                       -----------    ---------    ------------   ---------    -------------   --------
Maturity                                                              Dollars in thousands
<S>                                     <C>             <C>          <C>           <C>          <C>            <C>
Due in one year or less.............    $  20,532         9.6        $  20,067      10.2%       $    (465)       2.9%
Due in one through five years.......      112,591        52.7          103,679      52.5           (8,912)      55.2
Due in five through ten years.......       69,330        32.5           63,753      32.3           (5,577)      34.5
Due after ten years.................       11,202         5.2           10,011       5.0           (1,191)       7.4
                                       -----------    ---------    ------------   ---------    -------------   --------
Total...............................    $ 213,655       100.0        $ 197,510     100.0%       $ (16,145)     100.0%
                                       ===========    =========    ============   =========    =============   ========
</TABLE>

Funds withheld at interest

     Funds withheld at interest arise on contracts written under modified
coinsurance agreements. In each case, the business reinsured consists of fixed
deferred annuities. In substance, these agreements are identical to coinsurance
treaties except that the ceding company retains control of and title to the
assets. The deposits paid to the ceding company by the underlying policyholders
are held in a segregated portfolio and managed by the ceding company or by
investment managers appointed by the ceding company. These treaties transfer a
quota share of the risks. The funds withheld at interest represent our share of
the ceding companies' statutory reserves. The cash flows exchanged with each
monthly settlement are netted and include, among other items, our quota share of
investment income on our proportionate share of the portfolio, realized losses,
realized gains (amortized to reflect the statutory rules relating to interest
maintenance reserve), interest credited and expense allowances.

     At June 30, 2003, and December 31, 2002, we had four modified coinsurance
arrangements with two ceding companies. We had three contracts with Lincoln
National Insurance Company that accounted for $1.2 billion, which represented
98% of the funds withheld balances. The other contract is with Illinois Mutual
Insurance Company. Lincoln National Insurance Company has financial strength
ratings of "A+" from A.M. Best, "AA-" from Standard & Poor's, "Aa3" from Moody's
and "AA" from Fitch. In the event of insolvency of the ceding companies on our
modified coinsurance arrangements we would need to exert a claim on the assets
supporting the contract liabilities. However, the risk of loss is mitigated by
our ability to offset amounts owed to the ceding company with the amounts owed
to us by the ceding company.


                                       34
<PAGE>

                     Scottish Annuity & Life Holdings, Ltd.
                Management's Discussion and Analysis of Financial
                       Condition and Results of Operations

     Interest sensitive contract liabilities relating to the Lincoln National
Insurance Company contracts amounted to $1.9 billion at June 30, 2003 and
December 31, 2002.

     At June 30, 2003, funds withheld at interest totaled $1.2 billion with an
average rating of "A-", an average effective duration of 5.23 years and an
average book yield of 6.21% as compared with an average rating of "A-", an
average effective duration of 5.4 years and an average book yield of 6.49% at
December 31, 2002. These are fixed income investments associated with modified
coinsurance transactions; they include marketable securities, commercial
mortgages, private placements and cash. The market value of the funds withheld
amounted to $1.3 billion at June 30, 2003.

     According to data provided by our ceding companies, the following table
reflects the market value of assets backing the funds withheld at interest
portfolio using the lowest rating assigned by the three major rating agencies.

<TABLE>
<CAPTION>
                                                        June 30, 2003              December 31, 2002
                                                  -------------------------     ------------------------
        Ratings                                   $ in millions        %        $ in millions        %
        -------                                   -------------     -------     -------------     ------

<S>                                               <C>                <C>        <C>                <C>
        AAA...................................    $     168.4         12.5%     $     114.0         9.8%
        AA....................................           59.1          4.4             52.7         4.5
        A.....................................          440.3         32.6            418.7        35.8
        BBB...................................          498.0         36.9            425.9        36.5
        BB or below...........................           57.3          4.3             44.7         3.8
                                                  -----------     -----------   -----------    -----------
        Sub-total                                     1,223.1         90.7          1,056.0        90.4
        Commercial mortgage loans.............          126.1          9.3            112.3         9.6
                                                  -----------     -----------   -----------    -----------
        Total.................................    $   1,349.2        100.0%     $   1,168.3       100.0%
                                                  ===========     ===========   ===========    ===========
</TABLE>

     According to data provided by our ceding companies, the following table
reflects the market value of assets backing the funds withheld at interest
portfolio by sector.


<TABLE>
<CAPTION>
                                                         June 30, 2003             December 31, 2002
                                                  --------------------------  --------------------------
        Sector                                    $ in millions         %       $ in millions        %
        -------                                   -------------     -------     -------------     ------
<S>                                               <C>                <C>        <C>                <C>
        U.S. Treasury securities and U.S.
           government agency obligations....      $      14.3          1.1%      $     10.6         0.9%
        Corporate securities................            921.8         68.3            822.2        70.4
        Municipal bonds.....................              5.0          0.4              0.5         0.1
        Mortgage and asset backed securities            243.2         18.0            213.1        18.2
                                                  -----------     -----------   -----------    -----------
                                                      1,184.3         87.8          1,046.4        89.6
        Commercial mortgage loans...........            126.1          9.3            112.3         9.6
        Cash................................             38.8          2.9              9.6         0.8
                                                  -----------     -----------   -----------    -----------
        Total...............................      $   1,349.2        100.0%      $  1,168.3       100.0%
                                                  ===========     ===========   ===========    ===========
</TABLE>

Liquidity and Capital Resources

Cash flow

     Cash provided by operating activities amounted to $35.5 million in the
first six months of 2003 in comparison with cash flow of $9.2 million used in
operating activities in the same period of 2002. Operating cash flow includes
cash inflows from premiums, fees and investment income, and cash


                                       35
<PAGE>

outflows for benefits and expenses paid. In periods of growth of new business
our operating cash flow may decrease due to first year commissions paid on new
business generated. For income recognition purposes these commissions are
deferred and amortized over the life of the business.

     The increase in operating cash flow from 2002 was primarily due to
increases in premiums, fees, and investment income greater than increases in
benefits and expenses paid. Reinsurance premiums and fees received increased by
$49.5 million due to growth in business in our Life Reinsurance segment.
Investment income received increased by $20.0 million due to the growth in our
invested asset base. The increase was offset by declining yields. Benefits paid
increased by $29.3 million due to the growth of business in our Life Reinsurance
segments. Acquisition and other costs, including commissions, increased by $42.0
million. This increase related principally to new business written in our Life
Reinsurance North America segments and increased operating expenses. Acquisition
costs include commissions on first year business that are deferred when paid and
therefore do not impact net income until later years.

     Our cash flow from operations may be positive or negative in any period
depending on the amount of new life reinsurance business written, the level of
ceding commissions paid in connection with writing that business and the level
of renewal premiums earned in the period.

Capital and collateral

     At June 30, 2003, total capitalization was $662.7 million compared to
$623.6 million at December 31, 2002. Total capitalization includes long-term
debt and is analyzed as follows:

                                          June 30, 2003       December 31, 2002
                                      -------------------    -------------------
                                                  (dollars in thousands)
Shareholder's equity................  $         530,171       $         491,092
Long-term debt......................            132,500                 132,500
                                      -------------------    -------------------
Total                                 $         662,671       $         623,592
                                      ===================    ===================

     The increase in capitalization is due to the net income for the six months
ended June 30, 2003 of $15.1 million less dividends paid of $2.7 million and
comprehensive income of $36.5 million. Comprehensive income consists of the
unrealized depreciation on investments, the cumulative translation adjustment
arising from the translation of World-Wide Holdings' balance sheet at exchange
rates as of June 30, 2003 and a minimum pension liability adjustment.

     In April 2003, we filed and had declared effective a registration statement
with the Securities and Exchange Commission utilizing a "shelf" registration
process relating to a number of different types of debt and equity securities.
This shelf enables us to sell securities described in the registration statement
up to a total of $500.0 million.

     On July 23, 2003, we completed a public offering of 9,200,000 ordinary
shares (which included an over-allotment option of 1,200,000 ordinary shares) at
an offering price of $20.75 per share in which we raised aggregate net proceeds
of $179.7 million ($19.66 per share after the underwriting discount). We have
used $30.0 million of these proceeds to repurchase 1,525,000 ordinary shares
from Pacific Life Insurance Company at a purchase price of $19.66 per share.
Other expenses of the offering are expected to be approximately $1.2 million.
The remainder of the proceeds will be used for general corporate purposes. The
gross proceeds of this offering were $190.9 million and as a result $309.1
million remains of the shelf capacity.


                                       36
<PAGE>

                     Scottish Annuity & Life Holdings, Ltd.
                Management's Discussion and Analysis of Financial
                       Condition and Results of Operations

     During the six months ended June 30, 2003, we paid a quarterly dividend
totaling $2.7 million or $0.10 per share. During 2002, we paid dividends
totaling $5.0 million or $0.20 per share.

     During 2002, we arranged two secured credit facilities with U.S. banks
totaling $100.0 million. Each of the credit facilities provides for a
combination of borrowing and letters of credit of $50.0 million. These
facilities expire in September 2003 but are renewable with the agreement of both
parties. One of the facilities requires that Scottish Annuity & Life Insurance
Company (Cayman) Ltd., which we refer to as SALIC, and World-Wide Reassurance
maintain Standard & Poor's ratings of at least "A-" and that SALIC maintains
shareholder's equity of at least $210.0 million. At June 30, 2003, SALIC and
World-Wide Reassurance each had a Standard & Poor's rating of "A-" and SALIC's
shareholder's equity was $497.5 million. The other facility requires that
Scottish Annuity & Life maintain consolidated net worth of $375.0 million and a
maximum debt to total capitalization ratio of 25%. At June 30, 2003, Scottish
Annuity & Life's net worth was $530.2 million and the ratio of debt to total
capitalization was 20%. Subsequent to the public offering of ordinary shares
described above, the ratio of debt to total capitalization will be approximately
16%. Our failure to comply with the requirements of the credit facilities would,
subject to grace periods, result in an event of default, and we could be
required to repay any outstanding borrowings. At June 30, 2003, there were no
borrowings under the facilities. Outstanding letters of credit under these
facilities amounted to $27.6 million.

     We must have sufficient assets available for use as collateral to support
borrowings, letters of credit, and certain reinsurance transactions. With these
reinsurance transactions, the need for collateral or letters of credit arises in
four ways:

     o    when SALIC, Scottish Re (Dublin) Limited or World-Wide Reassurance
          enters into a reinsurance treaty with a U.S. customer, we must
          contribute assets into a reserve credit trust with a U.S. bank or
          issue a letter of credit in order that the ceding company may obtain
          reserve credit for the reinsurance transaction;

     o    when Scottish Re (U.S.), Inc. enters into a reinsurance transaction,
          it typically incurs a need for additional statutory capital. This need
          can be met by its own capital surplus, an infusion of cash or assets
          from Scottish Annuity & Life or an affiliate or by ceding a portion of
          the transaction to another company within the group or an unrelated
          reinsurance company, in which case that reinsurer must provide reserve
          credit by contributing assets in a reserve credit trust or a letter of
          credit;

     o    Scottish Re (U.S.), Inc. is licensed, accredited, approved or
          authorized to write reinsurance in 47 states and the District of
          Columbia. When Scottish Re (U.S.), Inc. enters into a reinsurance
          transaction with a customer domiciled in a state in which it is not a
          licensed, accredited, authorized or approved reinsurer, it likewise
          must provide a reserve credit trust or letter of credit; and

     o    even when Scottish Re (U.S.), Inc. is licensed, accredited, approved
          or authorized to write reinsurance in a state, it may agree with a
          customer to provide a reserve credit trust or letter of credit
          voluntarily to mitigate the counter-party risk from the customer's
          perspective, thereby doing transactions that would be otherwise
          unavailable or would be available only on significantly less
          attractive terms.


                                       37
<PAGE>

                     Scottish Annuity & Life Holdings, Ltd.
                Management's Discussion and Analysis of Financial
                       Condition and Results of Operations

     SALIC has agreed with Scottish Re (U.S.), Inc. that it will (1) cause
Scottish Re (U.S.), Inc. to maintain capital and surplus equal to the greater of
$20.0 million or such amount necessary to prevent the occurrence of a Company
Action Level Event under the risk-based capital laws of the state of Delaware
and (2) provide Scottish Re (U.S.), Inc. with enough liquidity to meet its
obligations in a timely manner.

     In addition, SALIC and Scottish Annuity & Life have agreed with World-Wide
Reassurance that in the event World-Wide Reassurance is unable to meet its
obligations under its insurance or reinsurance agreements, SALIC (or if SALIC
cannot fulfill such obligations, then Scottish Annuity & Life) will assume all
of World-Wide Reassurance's obligations under such agreements.

     Scottish Annuity & Life and SALIC have executed similar agreements for
Scottish Re (Dublin) Limited and World-Wide Life Assurance S.A. and may, from
time to time, execute additional agreements guaranteeing the performance and/or
obligations of their subsidiaries.

     Our business is capital intensive. We expect that our cash and investments,
together with cash generated from our businesses, will be sufficient to meet our
current liquidity and letter of credit needs. However, if our business continues
to grow significantly, we will need to raise additional capital.

Off balance sheet arrangements

     We have no obligations, assets or liabilities other than those disclosed in
the financial statements; no trading activities involving non-exchange traded
contracts accounted for at fair value; and no relationships and transactions
with persons or entities that derive benefits from their non-independent
relationship with us or our related parties.

Changes in Accounting Standards

     In December 2002, the Financial Accounting Standards Board issued SFAS
No.148, "Accounting for Stock-Based Compensation - Transition and Disclosure, an
Amendment of FASB Statement No. 123". In prior years, we applied the intrinsic
value-based expense provisions set forth in ABP Opinion No. 25, "Accounting for
Stock Issued to Employees". Effective January 1, 2003, we have prospectively
adopted the fair value-based stock option expense provisions of SFAS No. 123 as
amended by SFAS No. 148. This has resulted in a charge to income of $81,000 in
the three and six month periods ended June 30, 2003.

     In May 2003, FASB approved for issuance a Statement of Position ("SOP"),
"Accounting and Reporting by Insurance Enterprises for Certain Nontraditional
Long-Duration Insurance Contracts and for Separate Accounts". This Statement of
Position provides guidance on accounting and reporting by insurance enterprises
for certain nontraditional long-duration contracts and for separate accounts and
is effective for financial statements for fiscal years beginning after December
15, 2003. At the date of initial application of this SOP, we are required to
make various determinations, such as qualification for separate account
treatment, classification of securities in separate account arrangements,
significance of mortality and morbidity risk, adjustments to contract holder
liabilities, and adjustments to estimated gross profits as defined in SFAS No.
97, "Accounting and Reporting by Insurance Enterprises for Certain Long-Duration
Contracts and for Realized Gains and Losses from the Sale of Investments". We do
not believe the implementation of this SOP will have a material effect on our
financial statements.

     The Derivative Implementation Group has released Statement 133
Implementation Issue No. 36, "Embedded Derivatives: Bifurcation of a Debt
Instrument that Incorporates Both Interest Rate Risk and Credit Rate Risk
Exposures that are Unrelated or Only Partially Related to the Creditworthiness
of the


                                       38
<PAGE>

                     Scottish Annuity & Life Holdings, Ltd.
                Management's Discussion and Analysis of Financial
                       Condition and Results of Operations

Issuer of that Instrument" ("DIG B36"). DIG B36 addresses whether SFAS No. 133
"Accounting for Derivative Instruments and Hedging Activities" requires
bifurcation of a debt instrument into a debt host contract and an embedded
derivative if the debt instrument incorporates both interest rate risk and
credit risk exposures that are unrelated or only partially related to the
creditworthiness of the issuer of that instrument. Under DIG B36 modified
coinsurance reinsurance agreements where interest is determined by reference to
a pool of fixed maturity assets are arrangements containing embedded derivatives
requiring bifurcation. Our funds withheld at interest, which arise under
modified coinsurance agreements are therefore considered to contain embedded
derivatives requiring bifurcation. We are required to adopt DIG B36 in the
quarter ending December 31, 2003. We have not yet determined the value of the
related embedded derivatives in our funds withheld at interest. The market value
of funds withheld at interest was $1.3 billion at June 30, 2003.

Forward-Looking Statements

     Some of the statements contained in this report are not historical facts
and are forward-looking within the meaning of the Private Securities Litigation
Reform Act. Forward-looking statements involve known and unknown risks,
uncertainties and other factors, which may cause the actual results to differ
materially from the forward-looking statements. Words such as "anticipates",
"expects", "intends", "plans", "believes", "seeks", "estimates", "may", "will",
"continue", "project", and similar expressions, as well as statements in the
future tense, identify forward-looking statements.

     These forward-looking statements are not guarantees of our future
performance and are subject to risks and uncertainties that could cause actual
results to differ materially from the results contemplated by the
forward-looking statements. These risks and uncertainties include:

     o    uncertainties relating to the ratings accorded to our insurance
          subsidiaries;

     o    the risk that our risk analysis and underwriting may be inadequate;

     o    exposure to mortality experience which differs from our assumptions;

     o    risks arising from our investment strategy, including risks related to
          the market value of our investments, fluctuations in interest rates
          and our need for liquidity;

     o    uncertainties arising from control of our invested assets by third
          parties;

     o    developments in global financial markets that could affect our
          investment portfolio and fee income;

     o    changes in the rate of policyholder withdrawals or recapture of
          reinsurance treaties;

     o    the risk that our retrocessionaires may not honor their obligations to
          us;

     o    terrorist attacks on the United States and the impact of such attacks
          on the economy in general and on our business in particular;

     o    political and economic risks in developing countries;

     o    the impact of acquisitions, including the ability to successfully
          integrate acquired businesses, the competing demands for our capital
          and the risk of undisclosed liabilities;


                                       39
<PAGE>

                     Scottish Annuity & Life Holdings, Ltd.
                Management's Discussion and Analysis of Financial
                       Condition and Results of Operations

     o    loss of the services of any of our key employees;

     o    losses due to foreign currency exchange rate fluctuations;

     o    uncertainties relating to government and regulatory policies (such as
          subjecting us to insurance regulation or taxation in additional
          jurisdictions);

     o    the competitive environment in which we operate and associated pricing
          pressures; and

     o    changes in accounting principles.

     The effects of these factors are difficult to predict. New factors emerge
from time to time and we cannot assess the financial impact of any such factor
on the business or the extent to which any factor, or combination of factors,
may cause results to differ materially from those contained in any forward
looking statement. Any forward looking statement speaks only as of the date of
this report and we do not undertake any obligation, other than as may be
required under the Federal securities laws, to update any forward looking
statements to reflect events or circumstances after the date of such statement
or to reflect the occurrence of unanticipated events.

Risk Factors of Investing in Our Ordinary Shares

     Investing in our ordinary shares involves a high degree of risk. Prior to
investing in the ordinary shares, potential investors should consider carefully
the risk factors set forth in our Annual Report on Form 10-K filed with the
Securities and Exchange Commission, in addition to the other information set
forth in this Form 10-Q.


                                       40
<PAGE>


Item 3.  Quantitative and Qualitative Disclosures About Market Risk

     There have been no material changes since December 31, 2002. Please refer
to "Item 7A: Quantitative and Qualitative Disclosures About Market Risk" in our
Annual Report on Form 10-K.

Item 4.  Disclosure Controls and Procedures

     Evaluation of disclosure controls and procedures. Based on their evaluation
as of June 30, 2003, our principal executive officers and principal financial
officer have concluded that Scottish Annuity & Life's disclosure controls and
procedures (as defined in Rules 13a-14(c) and 15d-14(c) under the Securities and
Exchange Act of 1934 (the "Exchange Act")) are effective to ensure that
information required to be disclosed by Scottish Annuity & Life in reports that
it files or submits under the Exchange Act is recorded, processed, summarized
and reported within the time periods specified in Securities and Exchange
Commission rules and forms.

     Changes in internal controls. There have been no significant changes in
internal control over financial reporting that occurred during the quarter ended
June 30, 2003 that have materially affected, or are reasonably likely to
materially affect, Scottish Annuity & Life's internal control over financial
reporting.


                                       41
<PAGE>

PART II. OTHER INFORMATION

Item 1.  Legal Proceedings

     The Company is not currently involved in any material litigation or
arbitration.

Item 2.  Changes in Securities and Use of Proceeds

     On July 17, 2003, the Company completed a public offering of 9,200,000
ordinary shares (Commission File Number 333-104545), which included an
over-allotment option of 1,200,000 ordinary shares, for an aggregate offering
price of $190.9 million. After deducting estimated expenses of $11.2 million,
the Company raised aggregate net proceeds of $179.7 million. The managing
underwriters were Bear, Stearns & Co. Inc., UBS Investment Bank, A.G. Edwards &
Sons, Inc, Keefe Bruyette & Woods, Inc and Putnam Lovell NBF Securities Inc. The
Company used the proceeds of the offering to repurchase 1,525,000 shares, from
Pacific Life Insurance Company, and will use the remainder for general corporate
purposes.


Item 3.  Defaults Upon Senior Securities

     Not applicable.


                                       42
<PAGE>

Item 4.  Submission of Matters to a Vote of Securities Holders

     The 2003 Annual Meeting of Shareholders of the Company was held on May 5,
2003. The following items of business were presented to the shareholders of the
Company (the "Shareholders"):



                              Election of Directors



     The results of the vote of the Shareholders with respect to the three Class
II Directors were elected as proposed in the Proxy Statement dated April 2, 2003
under the caption titled "Proposal for Election of Directors" were as follows:



                           Total Vote       Total Vote

                           For              Withheld From

Name                       Each Director    Each Director



Class II Directors



Michael Austin             22,642,133       16,500

Lord Norman Lamont         22,642,133       16,500

Scott E. Willkomm          22,620,083       38,550


                                       43
<PAGE>


                      Ratification of Independent Auditors


     The Board of Directors has selected, based upon the recommendation of the
Audit Committee, Ernst & Young, as the independent auditors for the Company for
the fiscal year ending December 31, 2003. The results of the vote of the
Shareholders with respect to this selection were as follows:



         For:                22,432,236

         Against:               223,287

         Abstain:                 3,110


Item 5.  Other Information

         Not applicable.

Item 6.  Exhibits and Reports on Form 8-K

A.   Exhibits

     Except as otherwise indicated, the following Exhibits are filed herewith
and made a part hereof:

     3.1   Memorandum of Association of Scottish Annuity & Life, as amended as
           of December 14, 2001 (incorporated herein by reference to Scottish
           Annuity & Life's Current Report on Form 8-K/A).(6)

     3.2   Articles of Association of Scottish Annuity & Life, as amended as of
           May 2, 2002 (incorporated herein by reference to Scottish Annuity &
           Life's Current Report on Form 8-K filed with the SEC on April 14,
           2003).

     4.1   Specimen Ordinary Share Certificate (incorporated herein by reference
           to Exhibit 4.1 to Scottish Annuity & Life's Registration Statement on
           Form S-1).(1)

     4.2   Form of Amended and Restated Class A Warrant (incorporated herein by
           reference to Exhibit 4.2 to Scottish Annuity & Life's Registration
           Statement on Form S-1).(1)

     4.3   Form of Amended and Restated Class B Warrant (incorporated herein by
           reference to Exhibit 4.3 to Scottish Annuity & Life's Registration
           Statement on Form S-1).(1)


                                       44
<PAGE>

     4.4   Form of Securities Purchase Agreement for the Class A Warrants
           (incorporated herein by reference to Exhibit 4.4 to Scottish Annuity
           & Life's Registration Statement on Form S-1).(1)

     4.5   Form of Warrant Purchase Agreement for the Class B Warrants
           (incorporated herein by reference to Exhibit 4.5 to Scottish Annuity
           & Life's Registration Statement on Form S-1).(1)

     4.6   Form of Securities Purchase Agreement between Scottish Annuity & Life
           and the Shareholder Investors (incorporated herein by reference to
           Exhibit 4.10 to Scottish Annuity & Life's Registration Statement on
           Form S-1).(1)

     4.7   Form of Securities Purchase Agreement between Scottish Annuity & Life
           and the Non-Shareholder Investors (incorporated herein by reference
           to Exhibit to Scottish Annuity & Life's Registration Statement on
           Form S-1).(1)

     10.1  Employment Agreement dated June 18, 1998 between Scottish Annuity &
           Life and Michael C. French (incorporated herein by reference to
           Exhibit 10.1 to Scottish Annuity & Life's Registration Statement on
           Form S-1).(1)(10)

     10.2  Second Amended and Restated 1998 Stock Option Plan effective October
           22, 1998 (incorporated herein by reference to Exhibit 10.3 to
           Scottish Annuity & Life's Registration Statement on Form S-1).(1)(10)

     10.3  Form of Stock Option Agreement in connection with 1998 Stock Option
           Plan (incorporated herein by reference to Exhibit 10.4 to Scottish
           Annuity & Life's Registration Statement on Form S-1).(1)(10)

     10.4  Investment Management Agreement dated October 22, 1998 between
           Scottish Annuity & Life and General Re-New England Asset Management,
           Inc. (incorporated herein by reference to Exhibit 10.14 to Scottish
           Annuity & Life's Registration Statement on Form S-1).(1)

     10.5  Form of Omnibus Registration Rights Agreement (incorporated herein by
           reference to Exhibit 10.17 to Scottish Annuity & Life's Registration
           Statement on Form S-1).(1)

     10.6  1999 Stock Option Plan (incorporated herein by reference to Exhibit
           10.14 to Scottish Annuity & Life's 1999 Annual Report on Form
           10-K).(2)(10)

     10.7  Form of Stock Options Agreement in connection with 1999 Stock Option
           Plan (incorporated herein by reference to Exhibit 10.15 to Scottish
           Annuity & Life's 1999 Annual Report on Form 10-K).(2)(10)

     10.8  Employment Agreement dated September 18, 2000 between Scottish
           Annuity & Life and Oscar R. Scofield (incorporated herein by
           reference to Exhibit 10.16 to Scottish Annuity & Life's 2000 Annual
           Report on Form 10-K).(3)(10)


                                       45
<PAGE>

     10.9  Share Purchase Agreement by and between Scottish Annuity & Life and
           Pacific Life dated August 6, 2001 (incorporated by reference to
           Scottish Annuity & Life's Current Report on Form 8-K).(7)

     10.10 Amendment No. 1, dated November 8, 2001, to Share Purchase Agreement
           dated August 6, 2001 by and between Scottish Annuity & Life and
           Pacific Life (incorporated by reference to the Company's Current
           Report on Form 8-K).(5)

     10.11 2001 Stock Option Plan (incorporated herein by reference to Exhibit
           10.17 to Scottish Annuity & Life's 2001 Annual Report on Form 10-K).
           (4)(10)

     10.12 Form of Nonqualified Stock Option Agreement in connection with 2001
           Stock Option Plan. (incorporated herein by reference to Exhibit 10.17
           to Scottish Annuity & Life's 2001 Annual Report on Form
           10-K). (4)(10)

     10.13 Service Agreement dated December 31, 2001 between World-Wide
           Holdings, Paul Andrew Bispham and Scottish Annuity & Life.(4)(10)

     10.14 Registration Rights Agreement dated December 31, 2001 between
           Scottish Annuity & Life and Pacific Life (incorporated by reference
           to Scottish Annuity & Life's Current Report on Form 8-K).(5)

     10.15 Stockholder Agreement dated December 31, 2001 between Scottish
           Annuity & Life and Pacific Life (incorporated by reference to
           Scottish Annuity & Life's Current Report on Form 8-K).(5)

     10.16 Tax Deed of Covenant dated December 31, 2001 between Scottish Annuity
           & Life and Pacific Life (incorporated by reference to Scottish
           Annuity & Life's Current Report on Form 8-K).(5)

     10.17 Letter Agreement dated December 28, 2001 between Scottish Annuity &
           Life and Pacific Life (incorporated by reference to Scottish Annuity
           & Life's Current Report on Form 8-K).(5)

     10.18 Form of Indemnification Agreement between Scottish Annuity & Life and
           each of its directors and officers (incorporated by reference to
           Scottish Annuity & Life's Amended Quarterly Report on Form 10-Q/A for
           the period ended June 30, 2002).(8)(10)

     10.19 Employment Agreement dated July 1, 2002 between Scottish Annuity &
           Life Insurance Company (Cayman) Ltd. and Thomas A. McAvity, Jr.
           (incorporated by reference to Scottish Annuity & Life's Amended
           Quarterly Report on Form 10-Q/A for the period ended June 30,
           2002).(8)(10)

     10.20 Employment Agreement dated June 3, 2002 between Scottish Re (U.S.),
           Inc. and J. Clay Moye, III (incorporated by reference to Scottish
           Annuity & Life's Amended Quarterly Report on Form 10-Q/A for the
           period ended June 30, 2002).(8)(10)

     10.21 Employment Agreement dated June 1, 2002 between Scottish Annuity &
           Life and Elizabeth Murphy (incorporated by reference to Scottish
           Annuity & Life's Amended Quarterly Report on Form 10-Q/A for the
           period ended June 30, 2002).(8)(10)


                                       46
<PAGE>

     10.22 Employment Agreement dated June 1, 2002 between Scottish Annuity &
           Life and Clifford J. Wagner (incorporated by reference to Scottish
           Annuity & Life's Amended Quarterly Report on Form 10-Q/A for the
           period ended June 30, 2002).(8)(10)

     10.23 Employment Agreement dated July 8, 2002 between Scottish Annuity &
           Life and Scott E. Willkomm (incorporated by reference to Scottish
           Annuity & Life's Amended Quarterly Report on Form 10-Q/A for the
           period ended June 30, 2002).(8)(10)

     10.24 Employment Agreement dated February 10, 2003 between Scottish Annuity
           & Life and Michael C. French. (10)

     10.25 Employment Agreement dated February 10, 2003 between Scottish Re
           (U.S), Inc. and Oscar R. Scofield. (10)

     10.26 Amended employment Agreement dated February 10, 2003 between Scottish
           Annuity & Life and Thomas A. McAvity. (10)

     10.27 Indenture, dated November 22, 2002, between Scottish Annuity & Life
           and The Bank of New York (incorporated herein by reference to
           Scottish Annuity & Life's Registration Statement on Form S-3). (9)

     10.28 Registration Rights Agreement, dated November 22, 2002, between
           Scottish Annuity & Life and Bear Stearns & Co. and Putnam Lovell
           Securities Inc. (incorporated herein by reference to Scottish Annuity
           & Life's Registration Statement on Form S-3). (9)

     10.29 Employment Agreement dated May 1, 2003 between World-Wide Holdings
           Ltd. and David Huntley. (10)

     10.30 Share Purchase Agreement dated July 3, 2003 by and between Scottish
           Annuity & Life and Pacific Life Insurance Company (incorporated
           herein by reference to Scottish Annuity & Life's Current Report on
           Form 8-K filed with the SEC on July 8, 2003).

     23.1  Consent of Ernst & Young LLP.

     31.1  Certification Pursuant to Section 302 of the Sarbanes-Oxley Act of
           2002

     31.2  Certification Pursuant to Section 302 of the Sarbanes-Oxley Act of
           2002

     31.3  Certification Pursuant to Section 302 of the Sarbanes-Oxley Act of
           2002

     32.1  Certification Pursuant to 18 U.S.C. Section 1350, as Adopted Pursuant
           to Section 906 of the Sarbanes-Oxley Act of 2002.

     32.2  Certification Pursuant to 18 U.S.C. Section 1350, as Adopted Pursuant
           to Section 906 of the Sarbanes-Oxley Act of 2002.

     32.3  Certification Pursuant to 18 U.S.C. Section 1350, as Adopted Pursuant
           to Section 906 of the Sarbanes-Oxley Act of 2002.

     -----------------------
     (1)  Scottish Annuity & Life's Registration Statement on Form S-1 was filed
          with the SEC on June 19, 1998, as amended.

     (2)  Scottish Annuity & Life's 1999 Annual Report on Form 10-K was filed
          with the SEC on April 3, 2000.


                                       47
<PAGE>

     (3)  Scottish Annuity & Life's 2000 Annual Report on Form 10-K was filed
          with the SEC on March 30, 2001.

     (4)  Scottish Annuity & Life's 2001 Annual Report on Form 10-K was filed
          with the SEC on March 5, 2002.

     (5)  Scottish Annuity & Life's Current Report on Form 8-K was filed with
          the SEC on December 31, 2001.

     (6)  Scottish Annuity & Life's Current Report on Form 8-K/A was filed with
          the SEC on January 11, 2002.

     (7)  Scottish Annuity & Life's Current Report on Form 8-K was filed with
          the SEC on August 9, 2001.

     (8)  Scottish Annuity & Life's Amended Quarterly Report on Form 10-Q/A was
          filed with the SEC on August 8, 2002.

     (9)  Scottish Annuity & Life's Registration Statement on Form S-3 was filed
          with the SEC on January 31, 2003, as amended.

     (10) This exhibit is a management contract or compensatory plan or
          arrangement.

B. Reports on Form 8-K

     The following reports on Form 8-K were filed during the three month period
ended June 30, 2003.

     The Company filed a report on Form 8-K on April 14, 2003 to file under Item
5 (Other Events) the current text of Scottish Annuity & Life's Articles of
Association.

     The Company filed a report on Form 8-K on May 7, 2003 to report under Item
12 (Results of Operations and Financial Condition) that the Company had issued
on May 7, 2003 a press release announcing its second quarter earnings.


                                       48
<PAGE>

                                   SIGNATURES

     Pursuant to the requirements of the Securities Exchange Act of 1934, the
Registrant has duly caused this report to be signed on its behalf by the
undersigned, thereunto duly authorized.

                                        SCOTTISH ANNUITY & LIFE HOLDINGS, LTD.

Date:  August 12, 2003                       By: /s/ Scott E. Willkomm
                                                 Scott E. Willkomm
                                                 President
Date:  August 12, 2003                       By: /s/ Michael C. French
                                                 Michael C. French
                                                 Chief Executive Officer
Date:  August 12, 2003                       By: /s/ Elizabeth A. Murphy
                                                 Elizabeth A. Murphy
                                                 Chief Financial Officer


                                       49