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Skandia proportion of sales on platform rises

Skandia UK profits slumped by 29 per cent to £53m in the first half of this year from £75m in the first half of 2010.

The firm says the decline is due to a lower profit from smoothing of policyholder tax on the firm’s unit-linked policies.

It says this resulted in a benefit to the firm’s accounts of £14m the first half this year compared with £36m last year. If the effect of this is taken out, the firm’s profits would have been £39m in both years.

Total sales rose slightly from £3.3bn to £3.4bn. Eighty-two per cent of sales were from the firm’s platform compared with 78 per cent last year.

Chief executive Peter Mann says: “The customer benefits of platforms are increasingly becoming recognised as well as the efficiencies they deliver to financial advisers. We are supportive of the way that the FSA’s platform consultation is progressing and are pleased with the confirmation that it remains minded to ban cash rebates. We believe this is in the best interests of customers.”

Last week, the Skandia platform crashed due to a power outage which cut off electricity to its London office, where the platform is powered.

The system went down at around 9am on Thursday and remained down for the rest of the day and advisers had to fax instructions to the firm.

The problem was fixed over-night and the platform was fully operational by Friday.

A Skandia spokesman says: “We worked hard to restore systems so the platform was fully operational by the start of business on Friday. We would like to apologise for the inconvenience this may have caused.”

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