Axa's life and savings business rose just 6% to £1.09bn last year as tax changes affecting offshore bonds dampened growth, according to the group's annual results.
The provider says proposed changes to capital gains tax (CGT) in the first quarter of 2007 led to a drop in offshore bond sales, which fell 36% by the end of the year.
Meanwhile, offshore estate planning bond sales rose 68% and individual pension business rose 14%, leading to overall wealth management growth of 7%.
Total underlying earnings for the life and savings business rose 40% to £174m due to improved investment performance, higher fees and a £20m gain thanks to a 2%drop in the corporation tax rate to 28%.
New business values rose 12% to £133m, which Axa attributes to volume growth and margin improvements in some product lines. Group pension business rose just 2% while its protection business rose 27%.
Nicolas Moreau, group chief executive of AXA UK and Ireland, says: “We have consolidated our position in the employee support and well-being arena. At the same time our market share in both protection and IFA wealth management has improved.
"The other changes we are embarking on, from the launch of our wrap platform to the development of our investment office, are fundamental to the future of our business.”
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