REG-Standard Life plc Interim Management Statement - Part 2

Released: 29/10/2009


  
Part 2 : For preceding part double-click [nRn1c5536B]  
                                                                                                                                                                                               
  Total worldwide investment products excluding money market and   25,368         4,084                 (1,959)       2,125         3,290                        5,415           30,783        
  related funds                                                                                                                                                                                
                      UKMoney market funds (f)                     4,977          (683)                 -             (683)         (444)                        (1,127)         3,850         
                      India cash funds (f)(g)                      1,263          1,774                 -             1,774         (810)                        964             2,227         
  Total worldwide investment products                              31,608         5,175                 (1,959)       3,216         2,036                        5,252           36,860        
  
  
Total third party assets under management comprise the investment business noted 
above together with third party insurance contracts. New business relating to 
third party insurance contracts is disclosed as insurance business for reporting 
purposes. An analysis of total third party funds under management is shown 
below.  
  
 
                                                              Opening FUM    Gross inflows      Redemptions   Net inflows   Market and other movements   Net movement    Closing FUM   
                                                              1 Jan 2009                                                                                 in FUM          30 Sep 2009   
                                                              £m             £m                 £m            £m            £m                           £m              £m            
  Third party investment products                             31,608         5,175              (1,959)       3,216         2,036                        5,252           36,860        
  Third party insurance contracts  (new business classified   13,861         2,149              (1,083)       1,066         2,266                        3,332           17,193        
  as insurance products)                                                                                                                                                               
  Total third party assets under management                   45,469         7,324              (3,042)       4,282         4,302                        8,584           54,053        
                                                                                                                                                                                       
  Standard Life Investments - total assets under management   123,835                                                                                                    136,942       
  
  
(a) Included within mutual funds are cash inflows which have also been reflected 
in UK and Canada mutual fund new business sales.  
  
(b) In the nine months to 30 September 2008 UK mutual funds gross inflows were 
£925m and net inflows were £57m.    
  
(c) In the nine months to 30 September 2008 Canadian mutual funds gross inflows 
were £185m and net inflows were £53m.  
  
(d) Separate mandates refers to investment funds products sold in Canada 
exclusively to institutional customers. These products contain no insurance risk 
and consist primarily of defined benefit pension plan assets for which Standard 
Life Investments exclusively provides portfolio advisory services.  
  
(e) International gross inflows include India where, due to the nature of the 
Indian investment sales market, the new business is shown as the net of sales 
less redemptions. India cash funds are included under money market and related 
funds in the table.  
  
(f) Due to the nature of the Money market funds and India cash funds the flows 
are calculated using average net client balances. Other movements are derived as 
the difference between these average net inflows and the movement in the opening 
and closing FUM.   
  
(g) Historically, the Indian cash fund flows were calculated on the spot rate 
balances. Due to the volatility of these funds, the approach has been changed to 
ensure consistency with the methodology applied to UK money market funds.   
  
 (h) Funds denominated in foreign currencies have been translated to Sterling 
using the closing exchange rates at 30 September 2009. Investment fund flows are 
translated at average exchange rates. Gains and losses arising from the 
translation of funds denominated in foreign currencies are included in the 
market and other movements column. The principal closing exchange rates used as 
at 30 September 2009 were £1: C$1.72 (31 December 2008: £1:C$1.77) and £1:E1.09 
(31 December 2008: £1: E1.03). The principal average exchange rates for the nine 
months to 30 September 2009 were £1: C$1.79 (2008: £1: C$1.98) and £1: E1.12 
(2008: £1: E1.29).    
  
  Insurance operations net flows (regulatory basis)  
  
3 months ended 30 September 2009  
  
 
                                                     Gross inflows   Redemptions    Net inflows    Gross inflows   Redemptions    Net inflows   
                                                     3 months to     3 months to    3 months to    3 months to     3 months to    3 months to   
                                                     30 Sep 2009     30 Sep 2009    30 Sep2009     30 Sep2008      30 Sep 2008    30 Sep 2008   
                                                     £m              £m             £m             £m              £m             £m            
  UK                                                                                                                                            
  Individual SIPP (a)                                649             (285)          364            689             (205)          484           
  Individual pensions                                209             (540)          (331)          257             (741)          (484)         
  Group pensions(a)                                  570             (279)          291            609             (293)          316           
  Institutional pensions                             612             (270)          342            629             (268)          361           
  Pensions                                           2,040           (1,374)        666            2,184           (1,507)        677           
  Investment bonds                                   59              (274)          (215)          194             (386)          (192)         
  Mutual funds (b) (c)                               263             (61)           202            184             (87)           97            
  Savings and investments                            322             (335)          (13)           378             (473)          (95)          
  Annuities                                          133             (282)          (149)          136             (264)          (128)         
  Protection                                         23              (13)           10             27              (16)           11            
  Legacy life                                        97              (390)          (293)          114             (534)          (420)         
  UK life and pensions(d) (e)                        2,615           (2,394)        221            2,839           (2,794)        45            
                                                                                                                                                
  Europe                                                                                                                                        
  Ireland(d)                                         244             (234)          10             257             (143)          114           
  Germany                                            188             (22)           166            177             (17)           160           
  Europe life and pensions                           432             (256)          176            434             (160)          274           
                                                                                                                                                
  Canada                                                                                                                                        
  Group savings and retirement                       342             (238)          104            257             (255)          2             
  Individual insurance, savings and retirement       217             (162)          55             92              (149)          (57)          
  Group insurance                                    88              (70)           18             77              (45)           32            
  Mutual funds (b)                                   53              (41)           12             49              (38)           11            
  Canada life and pensions                           700             (511)          189            475             (487)          (12)          
                                                                                                                                                
  Total worldwide life and pensions excluding Asia   3,747           (3,161)        586            3,748           (3,441)        307           
                                                                                                                                                
  
  
(a) Included within non-insured SIPP is an element which is also included within 
UK mutual fund net flows in the third party Investment operations figures.  
  
(b) The mutual funds net flows are also included within mutual fund net flows in 
the third party Investment operations figures.  
  
(c) UK figures include Sigma UKFS mutual funds. 2008 figures have been re-stated 
to reflect inclusion of these mutual funds. The total net outflow for the period 
was £13m (2008: £54m outflow).  
  
(d) The offshore business is shown within the total Ireland result. This was 
previously included within UK life and pensions. The total net inflow for the 
period was £23m (2008: £155m inflow).  
  
(e) UK life and pensions include a total net outflow of £486m in relation to 
conventional with profits business (2008: £611m outflow).  
  
  Insurance operations new business   
  
3 months ended 30 September 2009   
  
 
                                                 Single Premiums                                        New Regular Premiums                                   PVNBP                                                                                      
                                                 3 months to 30 Sep 2009   3 months to 30 Sep 2008      3 months to 30 Sep 2009   3 months to 30 Sep 2008      3 months to 30 Sep 2009   3 months to 30 Sep 2008   Change    Changein constant currency   
                                                                                                                                                                                                                   (g)       (g) (h)                      
                                                 £m                        £m                           £m                        £m                           £m                        £m                        %         %                            
  UK                                                                                                                                                                                                                                                      
  Individual SIPP(a)                             587                       738                          12                        15                           642                       815                       (21%)     (21%)                        
  Individual pensions(b)                         85                        118                          5                         7                            97                        136                       (29%)     (29%)                        
  Group pensions(a)(b)                           140                       203                          65                        85                           378                       489                       (23%)     (23%)                        
  Institutional pensions                         477                       590                          (4)                       -                            470                       590                       (20%)     (20%)                        
  Pensions                                       1,289                     1,649                        78                        107                          1,587                     2,030                     (22%)     (22%)                        
  Investment bonds                               40                        161                          -                         -                            40                        161                       (75%)     (75%)                        
  Mutual funds (c)                               260                       177                          4                         2                            288                       195                       48%       48%                          
  Savings and investments                        300                       338                          4                         2                            328                       356                       (8%)      (8%)                         
  Annuities                                      95                        109                          -                         -                            95                        109                       (13%)     (13%)                        
  Protection                                     -                         -                            -                         1                            -                         2                         (100%)    (100%)                       
  UK life and pensions(d)                        1,684                     2,096                        82                        110                          2,010                     2,497                     (20%)     (20%)                        
                                                                                                                                                                                                                                                          
  Europe                                                                                                                                                                                                                                                  
  Ireland(d)                                     211                       219                          2                         2                            217                       234                       (7%)      (10%)                        
  Germany                                        5                         10                           6                         13                           80                        140                       (43%)     (49%)                        
  Europe life and pensions                       216                       229                          8                         15                           297                       374                       (21%)     (26%)                        
                                                                                                                                                                                                                                                          
  Canada                                                                                                                                                                                                                                                  
  Group savings and retirement                   131                       65                           6                         8                            214                       176                       22%       11%                          
  Individual insurance, savings and retirement   192                       67                           1                         -                            202                       72                        181%      153%                         
  Group insurance(e)                             -                         -                            7                         9                            117                       64                        83%       64%                          
  Mutual funds                                   53                        49                           -                         -                            53                        49                        8%        (4%)                         
  Canada life and pensions                       376                       181                          14                        17                           586                       361                       62%       47%                          
                                                                                                                                                                                                                                                          
  Asia                                                                                                                                                                                                                                                    
  India(f)                                       3                         2                            21                        26                           98                        95                        3%        (2%)                         
  China(f)                                       8                         14                           2                         2                            22                        24                        (8%)      (24%)                        
  Hong Kong                                      3                         2                            6                         3                            32                        14                        129%      95%                          
  Asia life and pensions                         14                        18                           29                        31                           152                       133                       14%       5%                           
                                                                                                                                                                                                                                                          
  Total worldwide life and pensions              2,290                     2,524                        133                       173                          3,045                     3,365                     (10%)     (12%)                        
  
  
(a) Included within non-insured SIPP is an element which is also included within 
UK mutual fund net flows in the third party Investment operations figures.  
  
(b) Single premiums include Department of Work and Pensions rebate premiums of 
£75m (2008: £93m), comprising Individual pension rebates of £41m (2008: £48m) 
and Group pensions rebates of £34m (2008: £45m).  
  
(c) UK figures include Sigma mutual funds. 2008 figures have been re-stated to 
reflect inclusion of these mutual funds. The 2009 impact is £39m (2008: £26m).  
  
(d) The offshore business is shown within the total Ireland result, comprising 
single premiums of £79m (2008: £163m) and PVBNP of £79m (2008: £163m). This was 
previously included within UK life and pensions.  
  
(e) Canada Group insurance includes £0.1m (2008: £nil) of new regular premiums 
in respect of Consultaction policies, representing the comparable full premium 
for £nil (2008: £nil) of new annualised fee income.  
  
(f) Standard Life's share of the Joint Venture Company's new business.  
  
(g) % change is calculated on the figures rounded to millions.  
  
(h) Calculated using constant rates of exchange.  
  
 (i) New business gross sales for overseas operations are calculated using 
average exchange rates. The principal average rates for the nine months to 30 
September 2009 were £1:C$1.79 (2008: £1: C$1.98) and £1: E1.12 (2008:£1:E1.29).  
Investment operations  
  
3 months ended 30 September 2009  
  
 
                                                                   Opening FUM    Gross inflows         Redemptions   Net inflows   Market and other movements   Net movement    Closing FUM   
                                                                   1 July 2009                                                                                   in FUM          30 Sep 2009   
                                                                   £m             £m                    £m            £m            £m                           £m              £m            
  UK                                      Mutual funds (a)         4,705          372             (b)   (241)         131           661                          792             5,497         
                                          Private equity           3,414          4                     (1)           3             219                          222             3,636         
                                          Segregated funds         10,995         338                   (256)         82            1,474                        1,556           12,551        
                                          Pooled property funds    832            -                     -             -             277                          277             1,109         
  Total UK                                                         19,946         714                   (498)         216           2,631                        2,847           22,793        
  Canada                                  Mutual funds (a)         1,267          60              (c)   (47)          13            233                          246             1,513         
                                          Separate mandates (d)    1,655          780                   (10)          770           326                          1,096           2,751         
  Total Canada                                                     2,922          840                   (57)          783           559                          1,342           4,264         
  International                           Europe                   1,500          180                   (10)          170           215                          385             1,885         
                                          Asia (excluding India)   87             1                     (1)           -             4                            4               91            
                                          India(e)                 1,595          (114)                 -             (114)         269                          155             1,750         
  Total International                                              3,182          67                    (11)          56            488                          544             3,726         
                                                                                                                                                                                               
  Total worldwide investment products excluding money market and   26,050         1,621                 (566)         1,055         3,678                        4,733           30,783        
  related funds                                                                                                                                                                                
                      Money market funds (f)                       4,770          (1,117)               -             (1,117)       197                          (920)           3,850         
                      India cash funds (f) (g)                     1,981          888                   -             888           (642)                        246             2,227         
  Total worldwide investment products                              32,801         1,392                 (566)         826           3,233                        4,059           36,860        
  
  
Total third party assets under management comprise the investment business noted 
above together with third party insurance contracts. New business relating to 
third party insurance contracts is disclosed as insurance business for reporting 
purposes. An analysis of total third party funds under management is shown 
below.  
  
 
                                                              Opening FUM    Gross inflows      Redemptions   Net inflows   Market and other movements   Net movement    Closing FUM   
                                                              1 July 2009                                                                                in FUM          30 Sep 2009   
                                                              £m             £m                 £m            £m            £m                           £m              £m            
  Third party investment products                             32,801         1,392              (566)         826           3,233                        4,059           36,860        
  Third party insurance contracts  (new business classified   14,523         721                (379)         342           2,328                        2,670           17,193        
  as insurance products)                                                                                                                                                               
  Total third party assets under management                   47,324         2,113              (945)         1,168         5,561                        6,729           54,053        
                                                                                                                                                                                       
  Standard Life Investments - total assets under management   121,552                                                                                                    136,942       
  
  
(a) Included within mutual funds are cash inflows which have also been reflected 
in UK and Canada mutual fund new business sales.  
  
(b) In the three months to 30 September 2008 UK mutual funds gross inflows were 
£352m and net inflows were £53m.    
  
(c) In the three months to 30 September 2008 Canadian mutual funds gross inflows 
were £55m and net inflows were £13m.  
  
(d) Separate mandates refers to investment funds products sold in Canada 
exclusively to institutional customers. These products contain no insurance risk 
and consist primarily of defined benefit pension plan assets for which Standard 
Life Investments exclusively provides portfolio advisory services.  
  
(e) International gross inflows include India where, due to the nature of the 
Indian investment sales market, the new business is shown as the net of sales 
less redemptions. India cash funds are included under money market and related 
funds in the table.  
  
(f) Due to the nature of the Money market funds and India cash funds the flows 
are calculated using average net client balances. Other movements are derived as 
the difference between these average net inflows and the movement in the opening 
and closing FUM.   
  
(g) Historically, the Indian cash fund flows were calculated on the spot rate 
balances. Due to the volatility of these funds, the approach has been changed to 
ensure consistency with the methodology applied to UK money market funds. 
Included within the net flows for the period is £272m relating to prior period 
Indian cash fund net flows.   
  
(h) Funds denominated in foreign currencies have been translated to Sterling 
using the closing exchange rates at 30 September 2009. Investment fund flows are 
translated at average exchange rates. Gains and losses arising from the 
translation of funds denominated in foreign currencies are included in the 
market and other movements column. The principal closing exchange rates used as 
at 30 September 2009 were £1: C$1.72 (30 June 2009: £1: C$1.91) and £1:E1.09 (30 
June 2009: £1: E1.17). The principal average exchange rates for the nine months 
to 30 September 2009 were £1: C$1.79 (2008: £1: C$1.98) and £1: E1.12 (2008: £1: 
E1.29).     
  
 
  Insurance operations new business                                                                                                                                                  
  15 months ended 30 September 2009                                                                                                                                                  
                                                                                                                                                                                     
                                                 Present Value of New Business Premiums (PVNBP)                                                                                      
                                                 3 months to 30 Sep 2009          3 months to 30June 2009     3 months to 31 Mar 2009   3 months to       3 months to 30 Sep 2008    
                                                                                                                                        31Dec2008(d)                                 
                                                 £m                               £m                          £m                        £m                £m                         
  UK                                                                                                                                                                                 
  Individual SIPP                                642                              696                         841                       870               815                        
  Individual pensions                            97                               191                         91                        87                136                        
  Group pensions                                 378                              911                         616                       464               489                        
  Institutional pensions                         470                              525                         419                       272               590                        
  Pensions                                       1,587                            2,323                       1,967                     1,693             2,030                      
  Investment bonds                               40                               70                          84                        112               161                        
  Mutual funds(a)                                288                              266                         276                       172               195                        
  Savings and investments                        328                              336                         360                       284               356                        
  Annuities                                      95                               110                         148                       110               109                        
  Protection                                     -                                1                           1                         1                 2                          
  UK life and pensions (b)                       2,010                            2,770                       2,476                     2,088             2,497                      
                                                                                                                                                                                     
  Europe                                                                                                                                                                             
  Ireland(b)                                     217                              208                         164                       417               234                        
  Germany                                        80                               86                          99                        178               140                        
  Europe life and pensions                       297                              294                         263                       595               374                        
                                                                                                                                                                                     
  Canada                                                                                                                                                                             
  Group savings and retirement                   214                              393                         357                       204               176                        
  Individual insurance, savings and retirement   202                              130                         110                       110               72                         
  Group insurance                                117                              145                         115                       62                64                         
  Mutual funds                                   53                               49                          53                        49                49                         
  Canada life and pensions                       586                              717                         635                       425               361                        
                                                                                                                                                                                     
  Asia                                                                                                                                                                               
  India(c)                                       98                               58                          145                       70                95                         
  China(c)                                       22                               23                          33                        43                24                         
  Hong Kong                                      32                               23                          14                        9                 14                         
  Asia life and pensions                         152                              104                         192                       122               133                        
                                                                                                                                                                                     
  Total worldwide life and pensions              3,045                            3,885                       3,566                     3,230             3,365                      
  
  
(a) UK figures include Sigma UKFS mutual funds. 2008 figures have been re-stated 
to reflect inclusion of these mutual funds.   
  
(b) 2008 comparatives have been restated to reflect the inclusion of Offshore 
business within the total Ireland result. The impact on the three months to 31 
December 2008: £228m; 30 September 2008: £163m. This was previously included 
within UK life and pensions.    
  
(c) Amounts shown reflect Standard Life's share of the Joint Venture Company's 
new business.   
  
(d) The three month period to 31 December 2008 excludes the full impact of 2008 
year end changes to non-economic assumptions. The effect of changes to year end 
non-economic assumptions was an increase in total PVNBP of £33m in the final 
PVNBP results published in the 2008 Preliminary results.           
  
 
  Insurance operations netflows (regulatory basis)                                                                                                                                             
  15 months ended 30 September 2009                                                                                                                                                            
                                                                                                                                                                                               
                                                 Net flows                                                                                                                                     
                                                 3 months to 30 Sep 2009                  3 months to 30 June 2009      3 months to 31 Mar 2009   3 months to       3 months to 30 Sep 2008    
                                                                                                                                                  31 Dec 2008                                  
                                                 £m                                       £m                            £m                        £m                £m                         
  UK                                                                                                                                                                                           
  Individual SIPP                                364                                      518                           441                       545               484                        
  Individual pensions                            (331)                                    (228)                         (370)                     (500)             (484)                      
  Group pensions                                 291                                      378                           293                       278               316                        
  Institutional pensions                         342                                      279                           281                       30                361                        
  Pensions                                       666                                      947                           645                       353               677                        
  Investment bonds                               (215)                                    (309)                         (516)                     (192)             (192)                      
  Mutual funds(a)                                202                                      172                           164                       82                97                         
  Savings and investments                        (13)                                     (137)                         (352)                     (110)             (95)                       
  Annuities                                      (149)                                    (136)                         (89)                      (135)             (128)                      
  Protection                                     10                                       11                            7                         13                11                         
  Legacy life                                    (293)                                    (292)                         (469)                     (359)             (420)                      
  UK life and pensions (b)                       221                                      393                           (258)                     (238)             45                         
                                                                                                                                                                                               
  Europe                                                                                                                                                                                       
  Ireland(b)                                     10                                       53                            9                         250               114                        
  Germany                                        166                                      162                           164                       231               160                        
  Europe life and pensions                       176                                      215                           173                       481               274                        
                                                                                                                                                                                               
  Canada                                                                                                                                                                                       
  Group savings and retirement                   104                                      83                            80                        59                2                          
  Individual insurance, savings and retirement   55                                       (27)                          (43)                      (48)              (57)                       
  Group insurance                                18                                       15                            16                        31                32                         
  Mutual funds                                   12                                       11                            4                         6                 11                         
  Canada life and pensions                       189                                      82                            57                        48                (12)                       
                                                                                                                                                                                               
  Total worldwide life and pensions              586                                      690                           (28)                      291               307                        
  excluding Asia                                                                                                                                                                               
  
  
(a) UK figures include Sigma UKFS mutual funds. 2008 figures have been re-stated 
to reflect inclusion of these mutual funds. The impact on the three months to 31 
December 2008: £41m outflow; 30 September 2008: £54m outflow.   
  
  
More to follow, for following part double-click [nRn3c5536B]