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Pru suffers Q1 sales drop as RDR hits with-profits bonds


Prudential has reported a 2 per cent drop in sales during the first quarter, from £189m in Q1 2012 to £185m this year, as with-profits bond sales slumped following the RDR.

The provider’s Q1 interim management statement, published this morning, shows individual annuity sales increased 15 per cent from £48m to £55m.

Corporate pensions sales were also up 8 per cent in the first quarter, from £49m in Q1 2012 to £53m this year.

However, onshore bond sales were down 18 per cent, from £55m to £45m, a trend which the provider says is largely due to the RDR.

Prudential says: “Sales of onshore bonds were down 18 per cent to APE of £45m, largely reflecting the anticipated reduction in sales of with-profits bonds as a consequence of the implementation of the Retail Distribution Review  regulations at the end of 2012. 

“First quarter with-profit bond sales were 21 per cent lower than the first quarter of 2012 despite benefiting from a significant pre-RDR pipeline. 

“We anticipate market dislocation will persist in the short-term as consumers and distributors adjust to the new environment and we continue to expect this will dampen our sales of investment bonds in 2013, compared to the level of sales achieved in 2012.”



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There are 5 comments at the moment, we would love to hear your opinion too.

  1. So Pru WP and Onshore bond sales are down as a result of RDR. What does that tell you? (As if we didn’t know all along). Now perhaps those who continue to bellyache about the RDR might perhaps concede that in some respects it was necessary.

  2. So RDR bashers, is it a good thing that customers can now see the full cost of WP bonds and choosing not to buy, or are customers now missing out on a good deal because advisers can’t convince them its worth the cost?

  3. This is no surprise and is, I suspect, largely due to falling adviser numbers (bank and other) and not, as some may wish to be the case, because customers have lost their appetite for such products!

    However, there is no solace in any of this!

  4. Patrick Schan 7th May 2013 at 11:41 am

    @Harry katz and John Anyeo

    I’m sorry fellas but I can’t accept your RDR points. I don’t know much about the Pru with profits bond, never having sold one, although I did once see a customer who was very pleased with the one she had, which did seem to have done pretty well. I don’t know if she still has it as she never, actually, became a client.

    There is no way I believe, however, that the RDR is a good thing, just because it means with profit bond sales have fallen. I can’t see anything inherently wrong with the concept of with profits, just with the implementation of them by certain companies that meant a lack of transparency, which was clearly a bad thing. I was, and am, concerned about the pricing of some products, pre and post RDR, but have not had the time to make any in depth investigations other than that which was directly applicable to the paltry amount of client business I have done so far this year, due to contantly falling behing with my admin.

    The RDR is a disaster, which has meant many good people leaving the inustry, with further to come. Lots of people are losing their jobs as a consequence of the RDR.

    better control of the banks, under the existing lesilation, could have achieved improvements without the wholesale slaughter that has come about and the loss of work time suffered taking pointless exams.

    I have always maintained the view that the crooks will find their way around any system, unfortunately. Just wait and see.

  5. RegulatorSaurusRex 8th May 2013 at 9:35 am

    Must pay Harry Katz a visit, he appears to have serious issues.

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