Long-term savings North America

North America

In North America our focus is on profitable growth, which we aim to achieve through diversifying our business mix, increasing internal rates of return and capital efficiency in this business. In the first three months of this year we generated good life and pension sales growth compared to the previous quarter. However, sales were lower than at the start of 2009 because of the specific actions we took last year to moderate the pace of our annuity sales and focus on capital efficiency, while driving growth in our life insurance business.

Compared to the fourth quarter of last year, sales rose by 24% to £997 million (4Q09: £803 million), which equates to an increase of 14% on a local currency basis. Measured against the same period last year, sales were 48% lower on a sterling basis and 44% lower on a local currency basis (1Q09: £1,929 million).

Annuity sales grew by 49% in the first quarter, compared to the previous three months (4Q09: £507 million), with good momentum in our application pipeline. Viewed against the first quarter of 2009, annuity sales were 57% lower at £755 million (1Q09: £1,752 million), for the strategic reasons outlined above.

We delivered strong life sales of £242 million in the first quarter, although following established seasonal patterns, sales were 18% lower than the fourth quarter of 2009 (4Q09: £296 million). Against the same period last year, our life sales have grown by 37%.