09.11.2005
2005 Third Quarter New Business Performance



Press releases are intended for information only and should not be relied upon by customers when making investment decisions.

Due to their nature some of the information in the press release may no longer be current.

  • UK Life & Pensions Annual Premium Equivalent (APE) up 5% to £648m in the nine months to 30 September 2005 (2004: £616m).
  • Worldwide APE insurance sales in the nine months to 30 September 2005 of £869m (2004: £861m).
  • Group Funds under management up by £16bn to £124bn over the nine month period.
  • Third party funds under management at Standard Life Investments up almost £7bn in the nine months to 30 September 2005 to £25.3bn, aided by record net new business.

UK Life and Pensions has delivered resilient performance as the repositioning programme continues.

The company's SIPP product is continuing to demonstrate strong performance with APE sales over the nine months to 30 September 2005 of £88 million against £24m last year (equivalent product). As we focus on the more profitable SIPP business, APE sales of UK individual pensions other than SIPP in the nine months to 30 September 2005 were £101 million (2004: £190m).

Group pensions APE sales over the nine months to 30 September 2005 were £277 million (2004: £264m). Within the Group pensions market, the company has however seen a reduction in volumes in the third quarter. A selective approach to pricing new business opportunities is being taken, with the aim of improving profitability of this line of business.

APE sales of UK Life and Pensions investment products in the nine months to 30 September 2005 were £151 million (2004: £87 million), supported by an expanding product range and strong underlying investment performance.

The Protection market remains highly competitive, with fewer house sales and increasingly strong price competition.

Standard Life Investments has recorded its strongest quarterly trading period. Worldwide gross fund inflows for the third quarter rose to over £1bn, up from £233m in the same period last year. Standard Life Investments now manages £112.5bn, of which third party funds under management represent £25.3 billion, an increase of £3 billion over the last three months and almost £7 billion for the year to date. This includes several significant pension fund mandate wins during the third quarter, driven in part by strong investment performance.

Standard Life Healthcare achieved sales of £15 million (2004: £23 million) during the nine months to 30 September 2005, reflecting a more focused approach on assessing the profitability of new business opportunities. During the period, the company signed a sale and purchase agreement for the Private Medical Insurance business of FirstAssist, which on completion (expected in the first quarter of 2006) should place Standard Life Healthcare as the third largest provider in the UK health insurance market.

The UK mortgage market remains competitive and Standard Life Bank's gross mortgage lending for the nine months to 30 September 2005 was £2,290 million (2004: £3,329 million). The mortgage balance ended the period at £10.5 billion (31 December 2004 £10.2 billion).

Standard Life Canada's APE insurance sales in the nine months to 30 September 2005 were £119 million (2004: £117 million). Individual annuities continue to see year on year growth, although Group annuities saw a fall in APE driven largely by a reduction in regular premium business.

Total APE new insurance business written outside the UK and Canada in the nine months to 30 September 2005 was £87 million (2004: £105 million).

In line with the rest of the German market, sales in Standard Life Germany fell below normal levels following last year's business surge ahead of the changes in taxation of pensions, which had a particular impact in the fourth quarter of 2004. In the nine months to 30 September 2005 APE sales were £51 million (2004: £71million). Standard Life Ireland's repositioning exercise continues and APE sales in the nine months to 30 September 2005 were £17 million (2004: £18 million).

In India the joint venture HDFC Standard Life demonstrated strong growth, with APE sales of £65 million (of which Standard Life's share was £17 million) in the nine months to 30 September 2005 (2004: £23 million of which Standard Life's share was £7 million). The Chinese joint venture Heng An Standard Life was granted permission to open a branch in Beijing, following the opening of its first branch in Qingdao earlier this year. The Beijing branch will open for business in early 2006. The sale of Standard Life's Spanish subsidiary, Prosperity, was completed in September.

Group Chief Executive, Sandy Crombie, commented:

"2005 is a pivotal year for Standard Life and the repositioning of our business continues. Group funds under management have reached £124bn, and total new insurance business, represented by single premiums plus new regular premiums, has risen by almost 17% from £3.9bn to £4.6bn. Although we expect many of our chosen markets such as group and individual pensions to remain competitive, the results for this third quarter demonstrate our continued progress in establishing a sound base from which to grow the business."

Notes to Editors

  1. All financial information is unaudited. The financial information shown in the press release has been prepared under UK GAAP. The group will be preparing its year-end financial statements in accordance with International Financial Reporting Standards. The subsidiary companies will continue to prepare their financial statements under UK GAAP.
  2. Following the change in 2004 of the Company's year-end from 15 November to 31 December and the change to calendar quarter reporting, appropriate comparatives for new business APE, investment sales and gross mortgage lending have been provided for the 9-month period to 30 September 2004.
  3. Annual Premium Equivalent (APE) sales comprise new regular premium sales plus 10% of single premiums.
  4. Standard Life participates in two joint-ventures with HDFC: a life assurance company, HDFC Standard Life Insurance Company, in which it holds 22.4% and HDFC Asset Management Company, in which it holds 49.9%.
  5. Insurance new business and Investment gross sales for overseas operations are calculated using average exchange rates. The principal average exchange rates used are £1:C$2.25 (2004 £1:C$2.38) and £1:Euro 1.46 (2004 £1:Euro 1.47). Funds under management are calculated using the closing exchange rate at the period end. The principal closing exchange rates used are £1:C$2.05 (2004 £1:C$2.29) and £1:Euro 1.47 (2004 £1:Euro 1.46)
View the full Q3 New Business Announcement.


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