Royal London, Britain's biggest mutual life assurer, revealed today that £1.1 billion had been wiped from its regulatory capital cushion in the past 12 months because of slumping markets and the deal to buy Resolution assets from Pearl, reports The Times .
The official measure of capital strength, the IGD capital surplus, shrank from £1.9 billion to £773 million. But Royal London said its "realistic" capital position was more resilient - down from £1.9 billion to £1.2 billion.
Mike Yardley, chief executive of Royal London, said, "Arguably, one would regard the fall in markets coupled with the banking crisis during 2008 as being a 1-in-200-year event. Despite this, our realistic capital position remains strong and is more than sufficient to withstand a further 1-in-200-year event." Full story...
GORDON BROWN'S PLANS for a $2 trillion (£1.4 trillion) "New Deal" to revive the global economy have been quietly dropped to preserve the facade of unity as world leaders gather in London for the G20 summit, according to The Telegraph.
The US and Britain have both backed away from spending proposals worth 2pc of global GDP, accepting that each country must find its own way. White House officials confess that there is no chance of a deal that entails further public debt.
"Nobody is coming to London to commit to do more right now. No single number is sacrosanct," said Michael Froman, the US deputy national security advisor.
British Foreign Secretary David Miliband disowned a leaked draft retaining talk of a $2 trillion boost, insisting that it was an old document that merely lists spending packages already under way across the world. Full story...
SIR FRED GOODWIN'S £703,000-a-year pension from Royal Bank of Scotland is expected to provoke a protest vote by the bank's major investors at what is likely to be a stormy annual meeting this week, reports The Guardian.
The crucial vote on the remuneration report belongs to UK Financial Investments, the government shareholder, which is expected to decide in the next 48 hours whether to heap further pressure on the former chief executive to hand back part of the payment by voting against the report.
As an investor with more than 50% of the votes, UKFI will determine the fate of the remuneration report. It is thought to be giving serious consideration to blocking the report.
Though votes on the remuneration report are not binding a vote against would send a clear signal to Goodwin about the opposition to his pension pot, which was doubled to £16.9m on the weekend of the October bank bailout. Full story...IFAonline
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