Update: Prudential sales slip hurts

28th Oct 2009 13:15

Prudential took a tumble Wednesday as a dive in UK business sent group insurance sales down 9% during the third quarter.The company reported insurance sales of £700m for the three months ended 30 September, with nine-month sales also dropping 9% to £2.02bn.UK retail sales slumped 22% to £157m, although they surged 66% in the US to a record £249m, while Asia enjoyed growth of 4% to £293m.Pru's Jackson business in the US boasted sales of £640m in the first nine months of the year, up 51% on the year before at actual exchange rates, while UK sales were down 13% for the period. The group blamed the drop in UK sales on trying to achieve a balance between writing profitable new business and capital conservation, which led to led to lower sales of individual annuities. Total UK new business sales dropped 28% to £534m, reflecting the large bulk annuity transaction executed in the third quarter of 2008.Weaker stock markets at the end of 2008 and start of this year also hurt sales of some other products including offshore bonds.Asset management net inflows rose 187% to £2.9bn during the quarter and were up 154% to £12.97m for the nine months. M&G boasted total net fund inflows of £11.1bn to the end of September, including £2.5bn in the third quarter. On its capital position, Pru estimated its IGD surplus at £2.8bn, covering its minimum capital requirement 2.4 times. "We believe that the economic environment will remain uncertain for a while," said chief executive Tidjane Thiam. "The group has clearly demonstrated its strong defensive capabilities and is now well positioned to benefit from the next stage of the economic cycle." Separately, the company said Nic Nicandrou had joined the business after 11 years at rival Aviva to become chief financial officer.