Upbeat Pru shrugs off Isa slump
PRUDENTIAL, the insurance giant, has shrugged off a slump in demand for individual savings accounts (Isas), lifting underlying sales by a better-than-expected 26% in the first quarter of 2002.
In the UK, strong sales of with-profits funds, individual annuities and pensions more than offset a 20% slide in Isa sales to £89m. Chief executive Jonathan Bloomer said the UK performance had beaten City expectations and that the Isa outcome was good, considering the overall market for the tax shelter savings vehicles had fallen by 30% or 40%. Investors have shunned Isas after the slide in stock prices last year.
Isa demand picked up in the last few weeks of the tax year. Sales volumes in March and the first five days of April were double those of the previous two months combined, and only 12% down on the equivalent period in 2001.
Bloomer said: 'Our strategy of growing internationally, broadening our distribution reach and diversifying our product range has once again been fully endorsed.'
Group-wide, the closely watched annual premium equivalent measure of sales grew by 26% to £806m. APE growth in the US was 7% while in Asia, the key area for Pru expansion, it fell 1% because of an exceptional previous year in Singapore.
Last week Legal & General posted a 34% increase in new business and a 77% rise in Isa sales, thanks to distribution deals with Barclays and Alliance & Leicester.
