Prudential has reported a 7 per cent increase in pre-tax operating profit for its UK business in 2014, despite a 49 per cent fall in individual annuity sales.
In its 2014 results, published today, the life office reported a pre-tax operating profit of £752m for its UK business, up from £706m in 2013.
An increase in bulk annuity transactions helped offset a 49 per cent drop in individual annuity sales following the Budget pension reforms.
Profit from new retail annuity sales almost halved, from £110m in 2013 to £57m in 2014.
Prudential wrote seven new bulk annuity deals in 2014, generating sales of £171m and new business profit of £105m.
This compares to three deals in 2013, which generated sales of £28m and new business profit of £24m.
The operating profit also includes a contribution of £23m from Prudential’s 25 per cent share of the PruHealth and PruProtect businesses, which it sold in November.
Prudential chief executive Tidjane Thiam says: “In the UK, our life business delivered a strong performance, with operating profit rising 7 per cent to £752, despite an unprecedented level of regulatory change affecting annuities, a core product for us.”