Just Retirement new business up by a quarter

13 April 2010 9:02 am | By Helen Pow

The group’s embedded value increased by almost 50 per cent during the period to £209.3m up from £139.8m at the end of June 2009. The firm says this reflects the growth in new business values and the reduction in corporate bond spreads, which produced a positive economic variance.

On top of this, the embedded value reflects the injection of £25m of new capital provided by Avalon Acquisitions Limited, supported by funds advised by Permira Advisers LLP, at the time of its acquisition of Just Retirement in November 2009.

Just Retirement’s funds under management which support its annuity book had grown to £2.3bn at December 31, over 22 per cent higher than the level reported at June 30, 2009.

The firm says current trading remains robust. Just Retirement recorded over £100m of total completions for annuities and equity release mortgages in March. This is the first time the Group has achieved this.

CEO Mike Fuller says the first half results benefitted from the early adoption of a profit and capital focussed strategy during the financial crisis.

He says: “The first half of the 2009/10 financial year has been very strong for Just Retirement. Market shares have grown for both products, group profit growth has been
successfully managed and our capital has remained robust.

“We are continuing to enjoy the benefits of this strategy and the position it has built for the group. Demand for enhanced annuities remains strong and, despite our competitive rate position, margins are positive.

“Whilst the market for equity release has been relatively weak, our own position within it continues to strengthen at attractive margins. Moreover, we have been able to maintain and enhance our growth without compromising our capital strength.”

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