Worldwide long-term savings new business – twelve months to 31 December 2005
Continental Europe
Poland (including Lithuania):
In the first nine months of 2005 CU Polska maintained first and second positions in the private pensions and life markets1, respectively. Total life and pension new business sales increased by 4% in 2005 to £285 million (2004: £241 million).
Life sales achieved strong growth of 27% in the year, with sales of £147 million (2004: £106 million) as a result of increased sales of single premium savings products on the back of a favourable market for long-term savings, especially in the second half of the year. The bancassurance agreement with Deutsche Bank signed in October to sell short-term endowments has contributed to this positive result. The long-term growth potential of the Polish life market is strong as household disposable income continues to rise in line with a general improvement in the economic outlook.
Pension sales were £138 million (2004: £135 million). Underlying growth was 12%, excluding exceptional sales in 2004 of £26 million made through the Polish Pension State Agency in respect of employees who had not chosen a pension provider. Following legislative changes prompted by competition issues, CU Polska and two other pension companies were excluded from this business in 2005.
Mutual fund sales were lower at £53 million (2004: £77 million) reflecting investor preference for products distributed through bank channels. In the last quarter of 2005, CU Polska signed a new distribution agreement with a leading bank-owned brokerage house. 2006 is expected to be a good year for the mutual fund industry in Poland, as the positive equity market performance is expected to increase investor confidence.
- Life market share is measured in terms of total premium income, pension market share in terms of total assets under management.
