SOURCE: Prudential plc

January 29, 2007 07:19 ET

Prudential PLC announce 2006 Full Year NBF

LONDON, UK -- (MARKET WIRE) -- January 29, 2007 --Embargo: 10.46am Monday 29 January 2007


All figures compared to 2005 at constant exchange rates unless stated

New business for the full year 2006:

                                APE       Growth      PVNBP     Growth

Total Group Insurance   GBP2,470 million    16%  GBP18,947 million  12%
Prudential UK retail    GBP689 million      14%  GBP5,594 million   15%

Total UK                GBP900 million       1%  GBP7,712 million    0%

Jackson                 GBP613 million      21%  GBP6,103 million   20%

Prudential Corporation 
Asia                    GBP956 million      30%  GBP5,132 million   26%

Asia Fund Management    Record net fund inflows of GBP2.5 billion, up 91%

M&G                     Record net fund inflows of GBP6.1 billion, up 58%

Mark Tucker, Group Chief Executive said:

"I am delighted by our full year new business figures: the Group's insurance new business has increased by 16 per cent year on year, on an APE basis, and our asset management businesses saw net inflows increase by 66% to GBP8.6 billion.

"We have seen a 25 per cent increase in the Group's insurance new business, on an APE basis, for the fourth quarter of 2006 compared to the same quarter in 2005 and an encouraging 21 per cent rise in new business for the fourth quarter of 2006 over the third. Overall the Group is in robust health.

"A 14 per cent increase in UK retail insurance operations APE sales was driven primarily by the growth in individual annuities and corporate pensions. In wholesale, we have chosen not to write business at unattractive pricing and therefore sales are down year on year.

"We have continued to reassess in depth the prospects for all sectors of the UK life and pensions market and are confident that there are profitable organic opportunities in the retirement savings and income market. We shall provide an update with further details by 15th March.

"Jackson, Prudential's US insurance business, achieved record new business of GBP613 million APE in 2006, representing a 21 per cent increase on 2005, driven by strong growth in sales of variable annuities, up 48 per cent on last year.

"Prudential's Asian life operations delivered new business APE of GBP956million, up 30 per cent in 2006 including a 25 per cent rise over the third quarter and reflecting the momentum of the business seen throughout the year. We have seen strong growth in a number of country markets including India up 95 per cent, China up 56 per cent and Korea up 54 per cent.

"Asset management continues to perform exceptionally well with M&G achieving record net fund inflows of GBP6.1 billion, an increase of 58 per cent, reflecting M&G's leading position in retail fund management, institutional fixed income, pooled life and pension funds, property and private finance.

"In Asia, PCA Fund Management also achieved record net inflows of GBP2.5 billion, almost double the 2005 figure. This reflects the product strength and increasing geographic diversification of our Asian fund management business.

"Trading conditions at Egg, our UK banking business, have seen further deterioration since we updated the market in October as a result of worsening credit experience and lower levels of lending than anticipated. Separately today, Prudential has announced that it has entered into a binding agreement to sell Egg to Citigroup for a consideration of GBP575 million subject to adjustment to reflect any change in net asset value between 31 December 2006 and completion.

"Going forward, the Group expects to maintain both its momentum in sales volume and its focus on value."

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