The group traded profitably in the period but made “significant” investments in technology, new customer services and in a number of “implementation activities” ahead of RDR, according to the first-half results for parent company Resolution.
In the corresponding period last year, SBG, which consists of an appointed representative network (Sesame), a support service provider for directly regulated IFAs (Bankhall) and a mortgage club for intermediaries (PMS), posted operating profits of £2m.
Parent company Resolution had operating profits before tax of £390m (IFRS) in the first half, up from £151m in the same period last year.
Value of new business dropped to £66m from £81m last year, impacted by lower volumes in the non-UK businesses.
Resolution said the group was continuing with its consolidation strategy following the acquisitions of Bupa Health Assurance, Friends Provident and Axa UK Life.
In March, the group relaunched the UK business under the brand Friends Life, which would focus on corporate benefits, individual protection and retirement income.
As part of this drive, the company has established a new business unit – the UK Heritage Business – to manage the requirements of customers with products it no longer actively markets to new customers, as well as those with legacy products that have previously been closed to new business.
It will be led by Evelyn Bourke, previously executive director for strategy, capital and risk at Friends Provident Holdings, who has been appointed chief commercial officer.
In June, the company confirmed it expected to be a single project vehicle – namely that it would focus solely on the UK Life Project – and that there was no requirement to retain cash for other projects.
A £500m targeted cash return was announced, with the first £250m to be returned to shareholders by way of a share buy-back during 2011, which began on 8 June.
The second £250m targeted cash return to shareholders is expected to take place during 2012 and is subject to delivery of capital synergies and regulatory approval with the form of return yet to be determined.
Looking forward, the group said it expected to profit from the onset of auto-enrolment, while it added it did not expect to be adversely impacted by the RDR.
