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Friends Prov new business up after strategic review

Friends Provident’s new life and pensions business increased by 11 per cent from £223m in the first quarter 2007 to £247m in the first quarter this year.

The firm, which announced it was selling F&C asset management, Lombard and Pantheon Financial in February to focus on its life and pensions business, saw its new business, excluding Lombard, increased by 11 per cent to £223 in the first quarter.

UK new business was down by 2 per cent from £169m in 2007 to £165m while Friends Provident International’s new business was up a significant 77 per cent from this time last year to £58m.

Lombard’s new business was up by 11 per cent to £24m and F&C’s assets under management dropped from £101.8bn in March 2007 to £103.6bn in December last year.

Friends Provident is planning to close 11 area sales offices, consolidating it into four regional offices, and conducting staff reviews in a bid to reduce its operating costs by at least £40m by the end of 2009.

Protection new business was down by 12 per cent to £15m in the first quarter. The firm attributes the decline to the troubled mortgage market. But premiums in force rose from £311m in December last year to £315m in the first quarter.

Pensions new business jumped 11 per cent to £127m. The firm withdrew from marketing schemes with unfunded initial commission after its strategic review and Friends Provident says a 21 per cent drop in new individual pensions business reflects this.

Executive chairman Adrian Montague says: “The first quarter new business figures were satisfying, and we were pleased that FPI continues to show a strong and growing contribution to the overall result. We are making good progress on delivery of our strategic review, and look forward to providing a full update at the interims.

“We continue to focus on our core strengths of manufacturing and administering life and pensions products in the UK and increasingly in international markets in order to achieve our objective of enhanced profitability and greater returns for our shareholders. There is much to be done, but we remain confident in our strategy and long-term
prospects.”

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Since Living Time was launched in November 2006, chief executive Kim Lerche-Thomsen has been keen to get the word out about a new way of pension planning.

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