Interim results - 6 months ended 30 June 2007
Operating and financial review
Overview
Detailed worldwide life and pension new business analysis
The present value of new business premiums (PVNBP) is derived from the single and regular premiums of the products sold during the financial period and is expressed at the point of sale. The PVNBP calculation is equal to total single premium sales received in the year plus the discounted value of regular premiums expected to be received over the term of the new contracts. The projection assumptions used to calculate PVNBP for each product are the same as those used to calculate new business contribution. The discounted value of regular premiums is also expressed as annualised regular premiums multiplied by a Weighted Average Capitalisation Factor (WACF). The WACF will vary over time depending on the mix of new products sold, the average outstanding term of the new contracts and the projection assumptions. The table below sets out the factors required to derive PVNBP by business units.
| Present | Present | Present | |||||
|---|---|---|---|---|---|---|---|
| 6 months 2007 £m | 6 months 2006 £m | Local currency growth1 | 6 months 2007 £m | 6 months 2006 £m | Local currency growth1 | Local currency growth1 | |
| United Kingdom | |||||||
| Individual pensions | 959 | 1,066 | (10)% | 211 | 216 | (2)% | (17)% |
| Group pensions | 367 | 294 | 25% | 42 | 49 | (14)% | 2% |
| Annuities | 927 | 748 | 24% | - | - | - | 24% |
| Bonds | 1,939 | 1,626 | 19% | - | - | - | 19% |
| Protection | 107 | 103 | 4% | 63 | 82 | (23)% | (15)% |
| Equity release | 110 | 165 | (33)% | - | - | - | (33)% |
| UNITED KINGDOM | 4,409 | 4,002 | 10% | 316 | 347 | (9)% | - |
| France | |||||||
| Euro funds2 | 925 | 963 | (3)% | 9 | 5 | 80% | - |
| Unit-linked funds | 631 | 802 | (20)% | 28 | 24 | 17% | (17)% |
| Protection business | 1 | 1 | - | 12 | 13 | (8)% | (16)% |
| 1,557 | 1,766 | (11)% | 49 | 42 | 17% | (8)% | |
| Ireland | |||||||
| Life and savings | 337 | 203 | 69% | 26 | 16 | 63% | 66% |
| Pensions | 257 | 130 | 101% | 46 | 31 | 48% | 58% |
| 594 | 333 | 81% | 72 | 47 | 53% | 62% | |
| Italy | |||||||
| Life and savings | 1,456 | 1,282 | 15% | 72 | 48 | 53% | 16% |
| 1,456 | 1,282 | 15% | 72 | 48 | 53% | 16% | |
| Netherlands (including Belgium and Germany) | |||||||
| Life | 219 | 204 | 9% | 32 | 46 | (29)% | (19)% |
| Pensions | 394 | 384 | 4% | 40 | 30 | 33% | 14% |
| 613 | 588 | 6% | 72 | 76 | (4)% | (1)% | |
| Poland | |||||||
| Life and savings | 130 | 80 | 63% | 14 | 15 | (7)% | 27% |
| Pensions | 64 | 40 | 60% | 16 | 9 | 78% | 69% |
| 194 | 120 | 62% | 30 | 24 | 25% | 44% | |
| Spain | |||||||
| Life and savings | 669 | 479 | 41% | 43 | 36 | 19% | 29% |
| Pensions | 126 | 117 | 10% | 16 | 16 | - | 4% |
| The | 795 | 596 | 35% | 59 | 52 | 13% | 23% |
| Italy | |||||||
| Life and savings | 1,456 | 501 | 15 | 15 | 575 | 501 | 15 |
| Other Europe | 51 | 32 | 59% | 31 | 23 | 41% | 45% |
| EUROPE | 5,260 | 4,717 | 13% | 385 | 312 | 25% | 12% |
| North America | |||||||
| Life | 26 | 21 | 37% | 35 | 1 | 3,400% | 984% |
| Annuity | 1,290 | 251 | 466% | 1 | 3 | (67)% | 446% |
| Funding agreements | 152 | - | - | - | - | - | - |
| The | 1,468 | 272 | 494% | 36 | 4 | 800% | 553% |
| Asia | 184 | 87 | 127% | 48 | 35 | 46% | 76% |
| Australia | 146 | 85 | 74% | 29 | 18 | 61% | 68% |
| ASIA PACIFIC | 575 | 575 | 15 | 575 | 575 | 501 | 15 |
| Italy | |||||||
| ASIA PACIFIC | 330 | 172 | 100% | 77 | 53 | 51% | 73% |
| Total life and pensions | 11,467 | 9,163 | 26% | 814 | 716 | 14% | 19% |
- Growth rates are calculated based on constant rates of exchange.
- Euro funds are savings that receive an annual bonus declaration, based on the investment performance of the underlying funds.
