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Friends Provident pre-tax profit dives 97%

Friends Provident, the ailing UK insurer, has revealed a pre-tax profit of £16m for 2007 – a whopping 97% down on 2006.

Profit declined from £509m in 2006 on a European Embedded Value basis.

Under EEV, an insurance company’s current worth is calculated according to future assumptions about certain rates, including mortality and investment performance, because of the long-term nature of insurance policies.

The news will no doubt strengthen recent takeover speculation about the company, which in the midst of a strategic review.

Private equity firm JC Flowers, which was one of the initial bidders for Northern Rock, is rumoured to be compiling a takeover bid for FP, having first raised interest the the company last May.

Sir Adrian Montague, executive chairman of FP, has said the firm would entertain a formal approach but claims that there has not yet been one by JC Flowers.

He says: “We are fully focused on implementing the strategic review to gain the benefits from it swiftly and efficiently. What will emerge is a self-financing, transparent and growing company built around its expertise in manufacturing and administering life and pensions products. “

Montague insists FP’s strong positions in the protection and pensions markets are the foundation of the firm’s UK business but he says his top priority is in profiting from the international markets through FP International.

He adds: “We look forward confidently to returning the company to profitable growth.

I am immensely proud of our own people for the way that they are sustaining the high levels of service that have become the hallmark of Friends Provident.”


Northern Rock calls time on SPML backed sub-prime range

Northern Rock is withdrawing its Southern Pacific Mortgage Limited back near prime and sub-prime range as of close of business tonight.NR began originating loans on behalf of Lehman Brothers owned UK mortgage brand SPML in April 2007, in return for fee income. The arrangement worked on the basis that NR would attract applications via its […]

BUDGET 2008: NLA welcomes stable budget

The National Landlords Association says it is pleased that stability and strength are cornerstones of the 2008 Budget.David Salusbury, chairman of the NLA, says: “Landlords who have acquired property in recent years who are looking to sell will be pleased to hear that the planned changes to the Capital Gains Tax regime go ahead next […]

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Fit for Work: guidance for employers published

On Friday, the Department for Work and Pensions published its guidance for employers on using the new Fit for Work (FfW) service to help ill employees return to the workplace. It also includes more details on the tax exemption for medical interventions that commenced on 1 January 2015.


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