SAVINGS. OVERVIEW.

Mark Gregory, Group Executive Director (Savings) (photo)

“The continued transformation of our savings business has delivered strong results in 2011 and leaves us well positioned for the changes facing our industry.”

MARK GREGORY
GROUP EXECUTIVE DIRECTOR (SAVINGS)


HIGHLIGHTS

  • TRANSFORMATION STORY CONTINUES IN SAVINGS DIVISION WITH IMPROVED PROFITABILITY AND OPERATIONAL EFFICIENCY.

  • WELL PLACED FOR THE CHANGES THAT RDR AND AUTO ENROLMENT WILL BRING TO THE MARKETPLACE.

  • WORKPLACE SAVINGS HAS SIGNED UP 133 SCHEMES IN 2011 GENERATING AN EXPECTED TRANSFER OF OVER 94,000 ACTIVE SCHEME MEMBERS.

  • OUR OWN INVESTMENT PLATFORM, INVESTOR PORTFOLIO SERVICE (IPS), HAS SIGNIFICANTLY GROWN IN SCALE OVER THE LAST YEAR, WITH £6.8BN OF MUTUAL FUNDS AND INSURED ASSETS AND OVER 420,000 CUSTOMERS.

£65bn

TOTAL ASSETS UNDER ADMINISTRATION (AUA)

(2010: £64bn)

OPERATING PROFIT

£128m

(2010: £115m)

  • Savings delivered an 11% increase in operating profit as the business continues the transformation required to maximise the opportunity of the Retail Distribution Review (RDR) and pensions auto enrolment.

NET CASH GENERATION

£111m

(2010: £68m)

  • Net cash generation increased 63% in 2011 as focus remains on asset accumulation, sales of capital light products and improving operational efficiency.

IFRS PROFIT BEFORE TAX

£94m

(2010: £61m)

  • IFRS profit before tax up 54% on 2010. [New business strain] as a percentage of [PVNBP] improved to 2.7%
    (2010: 2.8%).

SAVINGS INVESTMENTS

£688m

NEW BUSINESS [APE]

(2010: £643m)

  • New business APE increased by 7%. Sales of mutual funds on our platform, IPS, continue to perform well increasing by 58% to £204m (2010: £129m).

  • Unit Trusts and ISAs grew by 13% to £294m
    (2010: £261m).

  • Uninsured [SIPP] new business grew by 26% to £88m (2010: £70m) as we extend our distribution and reach. Our Suffolk Life proposition is now available on eight third-party platforms representing nearly 80% coverage of the SIPP market.

  • Savings Investments operating profit up 10% to £23m (2010: £21m).

INSURED SAVINGS

£445m

NEW BUSINESS APE

(2010: £478m)

  • Substantial increase in operating profits to £36m (2010: £31m) and net cash generation to £38m (2010: £1m) driven by our strategic shift towards fee-based products such as workplace pensions and focus on cost management.

  • Continued strong momentum in workplace savings, with a 30% year-on-year growth in schemes secured, although APE is lower for 2011 at £269m (2010: £311m) as a number of schemes have deferred completion into 2012 and 2013 to align with auto enrolment staging dates.

  • Despite market volatility in the second half of 2011, Insured bonds APE grew by 14% to £119m (2010: £104m), primarily driven by the success of our International Bonds proposition.

WITH-PROFITS

£69m

[IFRS OPERATING PROFIT]

(2010: £63m)

  • Operating profit, representing the shareholders’ share of the With-profits bonus, for all products sold in the With-profits fund, including With-profits pensions and With-profits bonds, was up 10% in 2011.

  • Net cash generation increased by 11% to £51m
    (2010: £46m).

  • New business [APE] reduced by 8% to £122m
    (2010: £132m).

top


Share this page.