Standard Life chief executive Sir Sandy Crombie says 'prompt action' on the revaluation of its Sterling Pension fund helped new business inflows recover quickly.
The group injected £102m into the Sterling fund in mid-February but IFAs criticised the time it had taken for Standard Life to make a decision on the future of the fund.
However, Standard Life says despite significantly reduced sales levels until mid-February, the group had managed to repair its relationship with IFAs quickly which fed through to core product sales in March and April 2009.
"Prompt action, including contributing capital to the fund, coupled with the strength of our distribution relationships, have seen our new business flows recover quickly," Crombie says.
Standard Life said market conditions also impacted on sales, with lower incoming transfer values into its pension products. It cited its decision not to renew bulk investment bond deals written in the first quarter of 2008 as another reason for the sales slump.
On the pensions side of the business, individual SIPP net inflows were lower at £441m (2008: £743m), and there was a 21% reduction in new business sales to £841m (2008: £1,059m).
Group pensions took lower net inflows of £293m (2008: £498m) and there was a 31% reduction in new business sales to £616m (2008: £896m). However, group SIPP volumes increased by 33% and accounted for 47% of total group pensions sales (2008: 24%).
Commenting on last week's Budget proposals on restrictions to the rate of tax relief on pension contributions from people earning more than £150,000 per annum, Standard Life said it did not expect the changes to have a material impact on its future business
According to its results announcement: "...a major part of our strategy involves consolidating and managing existing pension asset pools, particularly in the SIPP market, where pension tax relief has already been secured."
It said the Budget would present opportunities to broaden its ISA and offshore bond position.
On the investment side of the business, there were net outflows of £516m (2008: net inflow of £253m) for investment bonds and an 87% reduction in new business sales to £84m (2008: £652m).
Meanwhile, mutual funds sold on Standard Life's Wrap, Sigma and Fundzone platforms increased by 70% to £276m (2008: £162m) with net inflows rising to £164m (2008: £78m). Funds under administration on its Wrap platform increased by 12% to £1.9bn (31 December 2008: £1.7bn).
A number of endowment policies written during the early 1980s also reached maturity during the quarter. This led to a net outflow of £469m (2008: net outflow of £334m) for pre-Demutualisation life products.
Standard Life Investments achieved worldwide investment net inflows of £0.6bn compared with the record level of £2.3bn achieved during the first quarter of 2008. UK mutual fund sales showed a significant increase over the same period last year rising to £184m (2008: £21m).
Mortgage lending fell by 81% to £78m but Standard Life said this was consistent with its strategy to manage mortgage exposure during the ongoing period of difficult credit market conditions.
The group reported worldwide life and pension sales were 20% lower at £3.6bn (2008: £4.5bn).
No preferred charging model
To 1,552 families and businesses
HL and Liberty SIPP slowest
Lifetime and annual allowances