Soaring sales in Asia help Prudential bounce back

The company said the fast-growing economies of South-East Asia represented its primary focus for growth and investment as penetration rates for insurance products remained low in comparison with developed countries.

In support of this strategy, it said it had a strong position in the United States and a more focused business in the UK, where the Pru has concentrated on driving profits through value rather than volume growth.

By competing selectively in the retirement savings and income markets, the Pru said sales in the UK rose five per cent, to 166m, in the third quarter. The new business margin in the first nine months of the year improved by three percentage points on a year earlier, to 35 per cent in the UK, it added.

In Asia, where economic conditions are "very positive", Pru said sales rose 25 per cent, to 353m, despite the impact of regulatory changes in India.

Pru added: "With the exception of India, we expect that the favourable market conditions will persist for the remainder of the year, sustaining our sales momentum."

Analysts said the Pru had taken another step in its rehabilitation after an abortive bid to land the Asian arm of US giant AIG cost it 377m and incurred the wrath of shareholders.

Chief executive Tidjane Thiam faced calls to quit following the debacle earlier this year, when the Pru's major investors baulked at the $35.5bn asking price, and AIG refused to budge.

Mr Thiam said the company had restored relations with its shareholders following the collapse of the bid.

"It's a large diverse group and there's always a diversity of views at any one point of time, but we believe that with the body of our shareholders there's a good

understanding," he added.

Analysts at Shore Capital said: "Another terrific set of new business figures from Prudential."

Charles Stanley analyst Nic Clarke said: "We believe that this set of new business results, being better than expected, helps to re-build investor confidence in the Pru's management which was so badly damaged during the failed approach for AIA.

"Given the Pru's strong sales and new business profit growth our recommendation on the stock remains accumulate."

The company's US arm, Jackson, saw revenues jump 33 per cent,

to 850m, in the first nine months of the year, driven by annuity sales.

Across the group, new business profits for the same period lifted 21 per cent, to 1.34bn, the Pru added.

Shares closed last night at 623p, a fall of one per cent.