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Pru slashes payouts by 10 per cent on with-profits

Prudential has announced it is slashing payouts on with-profits by up to 10 per cent blaming substantial declines in the stockmarkets.

The cuts will affect unitised policies under the Prudential, Prudential International and Scottish Amicable brands, including the Pru Bond. Conventional with-profits are currently unaffected by the announcement.

The company has taken the unusual step of explaining the move in advertisement in the national press.

Prudential UK chief executive Mark Wood says: “In just over two and a half years the UK stockmarket has fallen by nearly 40 per cent, yet the strength of our well diversified with-profits fund has shielded our investors from the full impact of this decline. This is a prudent move to protect the strong financial position of the fund and the interests of our ongoing customers.”

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