Friends Provident’s various international businesses posted a 70% growth in sales, to £133.5m, during the period, paced by a 176% leap at Lombard, its Luxembourg-based, high-net-worth-focused wealth management operation.
A recent trend at Friends Provident whereby international results have tended to outshine those generated by the home UK market continued in the results unveiled today, which showed total UK life and pension sales slid by 13% in the third quarter and 1% in the year-to-date, to £105m and £295.9m respectively. This was described as in line with the comparable periods in 2009.
The results were the first to show the consolidated new business results of Friends Provident – acquired last year by Clive Cowdery’s Guernsey domiciled holding company, Resolution – and AXA UK’s life business, the acquisition of which Resolution officially completed on 15 September.
Separately, Friends Provident today revealed that AmLife, the Malaysian insurer in which it has a 30% stake, was one of four joint-venture companies to have been granted a takaful, or Islamic insurance, licence by the Malaysian authorities. A business venture between American International Assurance and Alliance Bank Malaysia was among the other three companies.
‘Return in cofidence levels’
Rocco Sepe, managing director of Friends Provident’s international businesses, said a “good return in confidence levels in the markets we trade in” had been a major factor contributing to the strong international sales, which, when looked at over the nine months since the beginning of January, were almost double the same period in 2009 – a gloomy time in many corners of the world, he admitted.
Friends Provident this year has suceeded in its efforts to realise more of its Luxembourg-based Lombard division’s annual sales in the first nine months of the year, rather than having them come in the fourth quarter, according to Sepe. He noted that this is likely to be reflected in less dramatic comparisons with last year’s final quarter for Lombard, FPI’s European wealth management arm, when the results for that period of 2010 come out early next year. This traditional year-end spike reflects the fact that 31 December is the end of the tax year in many countries and is thus a time when many consumers typically attend to their investments.
As for AmLife’s takaful licence, Sepe said Friends Provident and AmBank– AmLife’s parent – had worked hard to make their case to the authorities, who were believed to have turned down as many as six other applications, even though the Malaysian government is understood to be keen to promote the country as a global hub for Islamic insurance.
For AmBank, formerly known as the Arab-Malaysian Development Bank and Malaysia’s fifth-largest banking group, takaful seemed an obvious market to explore, he added.
Total sales £683m
Overall, sales in the nine months to 30 September for the Friends Provident Group totalled £683m on an annualised premium equivalent basis (APE), compared with £505m in 2009, a 35% increase. This figure excludes £26m in annual premium equivalent generated by the AXA operation.
As reported, Resolution last month announced plans to acquire Bupa Health Assurance for £102m, in a deal that is expected to complete early in 2011. In a statement accompanying today’s results, Friends Provident chief executive Trevor Matthews referred to the Bupa deal and Resolution’s other recent purchases, and said the consolidations underlined "our clear commitment to our core UK markets", even though "sales continue to reflect previous uncertainty over our UK position".
"Moving forward we will seek to capitalise on appropriate consolidation opportunities presented by Resolution’s UK Life Project,"Matthews added.
9 months 2010, £m |
9 months 2009, £m |
% change |
Q3 2010, £m |
Q3 2009, £m |
% change |
|
| Total UK Life & Pensions | 294.2 | 295.9 | (1) | 91.8 | 105 | (13) |
| International | 176 | 134.2 | 31 | 55.3 | 50.1 | 10 |
| Lombard | 213 | 74.9 | 184 | 78.2 | 28.3 | 176 |
| Total Intl Life & Pensions | 389 | 209.1 | 86 | 133.5 | 78.4 | 70 |
Total Life & Pensions |
683.2 |
505 |
35 |
225.3 |
183.4 |
23 |
