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Friends’ Matthews says up to 15% of advisers to take restricted route

Friends Provident chief executive Trevor Matthews says he expects around 10-15 per cent of IFAs to take the restricted route after the retail distribution review as the insurer revealed Sesame Bankhall is trading profitably in its Q1 results.

Friends Provident saw total UK life and pensions new business drop 3 per cent year on year and 21 per cent on the previous quarter at £88.1m, and the insurer says Sesame Bankhall is trading profitably and integration is nearly complete following Sesame’s acquisition of Bankhall in October 2009.

Friends’ life and pensions sales figure of £88.1m was down from £111.5m in Q4 2009 and £90.6m in Q1 2009. Total international life and pensions sales were up 53 per cent year-on-year, from £58.4m to £89.5m.

Within Friends’ new business figures, group pensions were down 5 per cent from £69.6m in Q1 2009 to £66.3m in the first quarter of this year.

Group pensions were down more sharply by 27 per cent quarter-on-quarter, from £91.1m in Q4 2010.

Friends Provident chief executive Trevor Matthews said on a conference call this morning that the drop was the delayed result of Friends having been removed from a number of employee benefits platforms at the time of its acquisition by Resolution, but added that the insurer had now been reinstated.

Group protection business was down 64 per cent from £2.2m in Q1 2009 to £0.8m in Q1 2010.

Individual life and pensions sales were up 12 per cent from Q1 2009 from £18.8m to £21m, and up 14 per cent on Q4 2009 when they were £18.4m.

Within life and pension sales, protection was down 4 per cent year-on-year, but annuities were up 37 per cent, pensions up 11 per cent and investments up 20 per cent.

Friends’ capital surplus was £1bn at the end of Q1 after a £65m dividend paid to Resolution Guernsey.

Resolution says 2010 will be “a decisive year for the re-shaping of many financial services groups”.

Speaking on a conference call this morning, Matthews said it was difficult to predict how many advisers would opt to take restricted route following the retail distribution review, but said it could be between 10 and 15 per cent.

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