Aegon UK chief denies company will be floated on stock market

OTTO Thoresen, chief executive of insurance firm Aegon UK, dismissed suggestions that the company might be sold or floated on the stock market, insisting that the firm was an "important element" of its Dutch parent company's business.

His assertion came despite a fall in sales of life and pensions products in the first quarter of the year compared to 2009.

Aegon said its UK life and pensions new business (API) in the first quarter of 2010 was 235 million, down 7 per cent on the same quarter last year as a result of the firm "significantly" reducing annuity rates in preparation for new European legislation.

But underlying earnings recovered strongly, up 178 per cent to 25m, thanks largely to rises in equity and bond markets and further growth in the business, the firm said.

Its Dutch parent company reported a return to profit in the first quarter, as it wrote down the value of investment assets by the smallest amount in nearly two years.

Net profit was 371m (316m), from a loss of 173m in the same period a year earlier.

When asked about the UK's new coalition government, Thoresen criticised the former Labour administration's "tinkering" with relief on pension savings for high earners.

He said the move had been "counterproductive" when the UK "was trying to encourage a savings culture".

He added: "Against a backdrop of growing pressure on public finances and significant levels of under-saving for retirement, pensions policy has to be a key issue for the government.

"Aegon is calling for an end to the continuous changes to tax relief on pension contributions, a review of the arrangements for automatic enrolment and an urgent review into public sector pensions."

Meanwhile, Standard Life Investments hailed a return of investor confidence in mutual funds. The Edinburgh-based fund manager said retail investors had invested 588m gross in its range of mutual funds during the first quarter.