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FCA closes investigation into four life insurance firms

Countrywide Assured and Old Mutual are among four life insurance providers to have avoided sanctions from the FCA as the regulator completes its investigations into firms’ closed-book practices.

The FCA has ended its inquiry, more than two years after it originally reviewed 11 providers over how they treated longstanding customers.

The regulator expressed particular concerns about failures in the market in general to disclose exit charges, and whether customers were given enough information on an ongoing basis.

Abbey Life, Countrywide Assured, Old Mutual, Police Mutual, Prudential and Scottish Widows were singled out for further review.

The FCA closed its investigations into Police Mutual last September, then Scottish Widows in June, noting there was not enough evidence to take enforcement action against either provider.

Examples of enforcement action include fines, bans, warning notices, court action or permission changes.

The FCA announced this morning that the remaining investigations – into Abbey Life, Old Mutual, Prudential and Countrywide Assured – have now been closed.

While the FCA “found the conduct of the four remaining firms did not warrant enforcement action”, the regulator adds that “in each firm, some issues have been identified during the investigations, which are being addressed as part of our ongoing supervision of those firms.”

The FCA’s statement did not detail any of the issues.

It says: “The FCA will continue to assess life insurance firms’ adherence to the required standards and principles, and take appropriate steps where necessary.”


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Apple: a stellar technology story

By Ali Unwin, head of technology sector research

Apple recently announced the highest-ever recorded quarterly net profit ($18bn), with the sale of 74.4 million iPhones helping the company deliver $74.6bn of revenue for the quarter ending December 2014. These sales were largely driven by strong demand for the new iPhone 6 and iPhone 6 Plus. Highlights included Chinese iPhone sales doubling year-on-year and unit growth of 44% in the US — supposedly a well-penetrated market. Apple ended the quarter with $178bn in cash on its balance sheet, having generated a staggering $30bn in free cash flow during the quarter.

At Neptune, we have been long-term believers in the Apple story, and continue to hold the stock in a number of our portfolios based on the company’s long-term growth prospects. This is predicated on our belief that Apple has proved thus far that it can — unusually for a consumer electronics company — maintain high margins for a sustained period of time, even as adoption of new technology slows down and competitors produce similar-specification products.


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