Prudential targets big growth in Asia

Prudential, facing shareholder pressure after the failed multi-billion-dollar attempt to buy AIA this year, also said it was targeting a doubling of last year's life insurance and asset management pre-tax profits by 2013.

"This is a very positive statement and I think that Prudential can deliver," said Shore Capital analyst Eamonn Flanagan, who listened to the company's presentation.

"They were convincing and I think this should put an end to talk about chief executive Tidjane Thiam or chairman Harvey McGrath quitting."

Prudential was forced to pull its $35.5-bn bid for AIA – the Asian life insurance business of stricken US insurer AIG – in June after shareholders balked at the price.

The deal, pulled at the very last minute, left Prudential to pay 337m in transaction fees. AIA was floated on the Hong Kong stock exchange in October.

Prudential's Asian business is seen as the jewel in the 162-year old insurer's crown, generating almost half of group sales and still growing strongly thanks to its exposure to the dynamic economies of southeast Asia.

Broker Panmure Gordon said the aim to grow Asian profitability would help close the valuation gap between the implied valuation of Prudential's Asian operation and its competitors, including AIA.

"The announcement today is of stretching targets and reinforces the dividend paying capabilities along with adequate capital to grow the business," Panmure Gordon said.

Prudential reported 713m in life insurance and asset management pre-tax operating profit in 2009.