Royal London, the UK’s biggest mutual life and pensions business, yesterday unveiled a further record quarter of new business to repeat the pattern it saw throughout 2015.
It came as Dutch insurance giant Aegon – which, like Royal London, has a strong Edinburgh presence – posted a 7 per cent rise in first quarter profits.
Royal London announced a 52 per cent leap in new life and pensions business sales to £2.09 billion in the first three months of 2016. That compared with £1.38bn in the same period of last year.
Group pensions sales jumped 86 per cent to £959 million in the quarter, individual pensions rose 29 per cent to £611m, while consumer new business sales surged 179 per cent to £67m.
The group, which employs 1,100 people across Edinburgh and Glasgow, also said that assets under management grew 4 per cent to £87.9bn compared with £84.5bn at end-December 2015.
The mutual called it “a pleasing performance during a period of volatile stock market movements resulting in lack of investor confidence”.
Chief executive Phil Loney said: “While new business growth remains robust, I anticipate that group pensions will see slowing momentum in coming quarters. While we continue to bring on board large numbers of schemes, we expect that the average premium will be lower as more smaller employers enrol their workforces into a pension.”
He said the group’s fund management arm performed well, seeing gross inflows of £1.1bn in the first three months of this year “largely due to a significant increase in institutional new business with a number of new clients”.
Meanwhile, Aegon revealed that its underlying earnings in the first quarter came in at €462 million (£363.4m), up from €432m in the same quarter of 2015.
Aegon’s European division, which includes 2,300 employees at Edinburgh Park, saw earnings jump 20 per cent to €169m. Adrian Grace, UK chief executive, said in the first quarter his division had earnings of £18m.
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Earnings in the Americas fell 2 per cent, partly due to “lower fee income from lower average equity markets during the quarter”.
The group’s asset management arm’s earnings were steady at €45m, partly helped by higher performance fees in China. The wider Asian business broke even in the first quarter after a €3m loss a year ago, partly driven by growth of business with affluent customers.