Standard Life recorded a 5% jump in UK life and pensions new business in the first half of the year, with strong IFA take-up and sales on its wrap platform a highlight for the Edinburgh-based insurer.
UK life and pensions new business climbed to £948m (APE) for H1, up on the £902m in the corresponding period last year.
The firm’s UK operating profit before tax leapt 70% during the half to £394m (EEV), mainly attributed to a one off £105m UK immediate annuities reinsurance.
Overall, the group's before tax operating profit increased by 51% to £534m (EEV).
However, Standard Life’s UK net flows dipped to £1.43bn, slightly lower than the £1.47bn recorded in H1 last year.
The firm saw a 33% jump in mutual fund sales to £324m, which it attributed to the growing customer base on the wrap and FundZone platforms.
IFA firms using the platform leapt from 209 to 263 during the period, which accounts for 12,900 customers with an average fund size of £113,000. Wrap funds under administration increased by 36% to £1.5bn during the period.
Standard Life also recorded strong offshore bond sales, more than three times the previous year.
Individual SIPP funds under administration jumped 12% to £8.6bn, while SIPP customer numbers increased 23% to 57,500. Standard Life says a 19% drop in individual SIPP sales to £2.1bn was due to a very strong prior year significantly enhanced by heightened post A-day activity.
It expects the continued growth in this area, predicting the UK SIPP market to double in size to £100bn of assets by 2011.
Meanwhile, the volatile market conditions hit gross lending, down 54% to £728m. The firm’s mortgages under management stand at £10.6bn, with an arrears rate of 0.24% – less than a fifth of the Council of Mortgage Lenders' industry average at 31 March.
Standard Life group chief executive Sandy Crombie says the firm has enjoyed a successful H1, despite the difficult market conditions.
“In our life and pensions businesses, net flows were strong, sales showed good growth and profitability was maintained,” he says.
“In Standard Life Investments, net inflows offset the impact of market declines so that third party funds under management remained constant.
“Looking ahead, we will continue to drive further efficiency gains, whilst investing in our businesses where we identify opportunities for growth.
“Reflecting our progress in the first half and our confidence about the future, the board is increasing the interim dividend payment by 7%.”IFAonline
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