Friends Provident International has seen sales in the first nine months of 2008 rise 29% compared with the same period in 2007, despite turbulent global market conditions.
Although the bulk of the rise, measured in annual premium equivalent (APE), came in the first two quarters, the third quarter still saw year-on-year growth of 20% if Asian sales are excluded. New business from Hong Kong fell, causing an 8% drop in overall new business for FPI in the third quarter, but this came after an exceptionally strong Q3 2007 figure, and Q3 2008 sales in Hong Kong were 108% ahead of the same period in 2006.
Managing director Rocco Sepe said last year’s Q3 figures from Hong Kong reflected an exceptional combination of a very strong market and FPI’s proposition “really starting to fly” in the region. “While the figure is down on 2007, it’s something of a consolidation – you can’t expect it to grow exponentially forever,” he added.
The figures were released as part of an update from the Friends Provident group, which has also confirmed its intention to divest from fund management business F&C Investments. Sepe said this should have minimal impact on FPI policyholders.
“We have tried to manage our relationship with F&C on an arm’s-length basis, and that will be formalised,” he explained. “We are not expecting any dramatic change immediately; we know the people there well and would like to think those relationships will be mutually beneficial going forward.”
While FPI’s new business advances reflect Friends Provident’s decision to focus on growing outside the UK, Sepe warned the immediate future will still hold substantial challenges.
“It very much depends on the world economy, and the stability of banking institutions first and foremost,” he said. “It’s hard to call at the moment – the uncertainty will contribute to a growing sense of unease among clients, and we may see that translate into slower sales. If we are heading into a worldwide recession, that will bring problems.”
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