Prudential plc

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Prudential plc
Public limited company
Traded as LSEPRU
NYSEPUK
SEHK2378
FTSE 100 Component
Industry Financial services
Founded 1848; 169 years ago (1848)
(London)
Headquarters London, EC4
United Kingdom
Area served
Worldwide
Key people
Paul Manduca
(Chairman)
Mike Wells
(Group Chief Executive)
Products Life insurance
Investment management
Consumer finance
Revenue £71.842 billion (2016)[1]
£3.212 billion (2016)[1]
£1.921 billion (2016)[1]
Website www.prudential.co.uk

Prudential plc is a British multinational life insurance and financial services company headquartered in London, United Kingdom. It was founded in London in May 1848 as The Prudential Mutual Assurance Investment and Loan Association to provide loans to professional and working people.[2]

Prudential has 24 million life customers.[3] It owns Jackson National Life Insurance Company, which is one of the largest life insurance providers in the United States, and M&G Investments, a Europe-focused asset manager.[4]

Prudential has a primary listing on the London Stock Exchange and is a constituent of the FTSE 100 Index. Prudential has secondary listings on the Hong Kong Stock Exchange, New York Stock Exchange and Singapore Exchange.

History[edit]

Early history[edit]

The company was founded in Hatton Garden in London as The Prudential Mutual Assurance Investment and Loan Association providing loans to professional and working people on 30 May 1848.[2] In 1854, the Company began selling the relatively new concept of industrial branch insurance policies to the working class population for premiums as low as one penny through agents acting as door to door salesmen. The army of premium collection agents was for many years identified with the Prudential as the "Man from the Pru".[2] It moved to its traditional home at Holborn Bars in 1879 and converted to a limited company in 1881.[2] The building was designed by Alfred Waterhouse, and is built of terracotta manufactured by Gibbs and Canning Limited of Tamworth (c.1878) — two of the same driving forces behind the Natural History Museum in London.[5]

Twentieth century[edit]

Holborn Bars—Traditional home of Prudential

The company was first listed on the London Stock Exchange in 1978.[6] In 1986, Prudential acquired the American insurer Jackson National Life.[7] In 1997, Prudential acquired Scottish Amicable, a business founded in 1826 in Glasgow as the West of Scotland Life Insurance Company, for £1.75bn.[8]

In 1998, Prudential set up Egg, an internet bank within the UK. The subsidiary reached 550,000 customers within nine months but had difficulty achieving profitability.[9] In June 2000, an initial public offering of 21% was made to allow for further growth of the internet business but in February 2006 Prudential decided to repurchase the 21% share of Egg.[10] Egg was subsequently sold to Citibank in January 2007.[11] In 1999, M&G, a UK fund management company, was acquired.[12] In June 2000, the company was first listed on the New York Stock Exchange to help focus on the US market.[13]

Twenty-first century[edit]

In October 2004, Prudential launched a new subsidiary, PruHealth, a joint venture with Discovery Holdings of South Africa selling private medical insurance to the UK market.[14] In April 2008, Prudential outsourced its back office functions to Capita: about 3,000 jobs were transferred (1,000 in Stirling, 750 in Reading and 1,250 in Mumbai).[15] This significant outsourcing deal, worth an estimated £722m over a 15-year contract, built on Prudential's existing relationship with Capita who took over its Belfast operation in 2006 along with approximately 450 employees in a smaller operational restructure.[16]

On 1 March 2010, Prudential announced that it was in "advanced talks" to purchase the pan-Asian life insurance company of AIG, American International Assurance (AIA) for approximately £23 billion.[17] The deal later collapsed and AIA ended up raising money in an IPO.[18]

In December 2013, Prudential announced the purchase of Ghana’s Express Life Company. Express Life was subsequently rebranded as Prudential Ghana.[19] In April 2014, Prudential launched two corporate responsibility initiatives to support education in Ghana: the Prudential Scholarship Programme for more than 500 senior high school students, in partnership with the NGO Plan Ghana; and a scheme to support actuarial science graduates.[20] In September 2014, Prudential purchased Kenyan life insurer Shield Assurance and rebranded it as Prudential Kenya, further expanding the company’s presence in Africa.[21]

On 10 March 2015, it was announced that the CEO, Tidjane Thiam, would leave Prudential to become the next CEO of Credit Suisse.[22] On 1 May 2015, it was announced that Mike Wells, head of the company's US business, would succeed Tidjane Thiam as CEO, on a pay package worth up to £7.5 million.[23]

Operations[edit]

Prudential's administrative centre in Reading, United Kingdom

The Company has four business units:[24]

  • Prudential UK, Europe & Africa: the business offers pensions, annuities, savings and investments (bonds, ISAs). They are particularly well known for the sale of with-profit bonds and pensions, corporate pension schemes, bulk annuities and individual annuities. The company left the general insurance (household, car) market in 2002, licensing Churchill Insurance (now part of the Direct Line Group) to use the Prudential name.
  • M&G: the business offers investment management services including retail fund management, institutional fixed income, pooled life, pension funds, property and private finance. Part of M&G, Prudential Property Investment Managers specialises in the management of Prudential's property assets.
  • Prudential Corporation Asia: based in Hong Kong,[25] the business is the largest UK life assurer in Asia. It has had a presence in the continent since 1923 when an overseas agency for life assurance was created in India. Although this was subsequently nationalised, Prudential relaunched in India in 2000 as ICICI Prudential, a 26% joint venture with ICICI Bank. As CITIC Prudential Life, a 50–50 joint venture, they were the first UK company to re-establish life business in China in 2000. There are also businesses in Hong Kong, Taiwan, Japan, South Korea, Singapore, Malaysia, Philippines, Thailand, Vietnam and Indonesia. On 15 November 2011, Prudential Corporation Asia announced its intention to change the name of its asset management business to Eastspring Investments.
  • Jackson National Life Insurance Company: based in Michigan, United States,[26] the business was purchased in 1986. It was named after Andrew Jackson, the seventh President of the United States of America and started business in 1961.

Prudential RideLondon[edit]

Prudential RideLondon is an annual two-day cycling festival, held for the first time in 2013. The 2015 Prudential RideLondon-Surrey 100 saw over 25,500 finishers and set a new fundraising record for the event with more than £12 million raised for charity.[27]

The event was developed by the Mayor of London and his agencies and is organised by the London & Surrey Cycling Partnership. The main events are a 100-mile professional road race through Surrey and London, and an amateur race along the same route. Participants in the amateur race typically raise money for good causes. The 20,709 finishers in the 2014 event raised more than £10 million for charity.[28]

The inaugural sponsor of RideLondon, Prudential has extended its sponsorship of the event for a further three years, up to and including the 2018 event.[29]

Swansea Bay Tidal Lagoon[edit]

In October 2014, Prudential announced that it will invest up to £100 million in the Swansea Bay Tidal Lagoon Power station, a world-leading infrastructure project. Prudential has committed to invest £25 billion in UK infrastructure projects over five years. Prudential will be one of the main investors in the scheme designed to harness tidal-energy, which could power 120,000 homes for 120 years. If approved, the project would take two years to build and would create 1,850 construction jobs.[30]

Senior management[edit]

Key individuals are:

Chairman of the Board of Directors Paul Manduca
Group Chief Executive Mike Wells
Chief Financial Officer Mark FitzPatrick
Chief Executive of M&G Anne Richards (chief executive)
Chief Executive of Prudential Corporation Asia Nic Nicandrou
Chairman and Chief Executive of the North American Business Unit Barry Stowe
Chief Executive, Prudential UK & Europe John Foley
Group Chief Risk Officer Penny James
Group Chief Digital Officer Al-Noor Ramji

See also[edit]

References[edit]

  1. ^ a b c "Full Year Results 2016" (PDF). Prudential Public Limited Company. Retrieved 9 April 2017. 
  2. ^ a b c d "Timeline 1826–1901". Prudential plc. Retrieved 13 December 2013. 
  3. ^ "Fact file 2016" (PDF). Prudential plc. Retrieved 9 April 2017. 
  4. ^ "Prudential Plc Investor Conference 2014". Prudential plc. Retrieved 2 December 2014. 
  5. ^ Research page including details of many buildings that used Gibbs and Canning terracotta accessed 25 March 2012
  6. ^ "Prudential plc". London Stock Exchange. Retrieved 9 April 2017. 
  7. ^ "Prudential P.L.C. To Buy Jackson". New York Times. 19 September 1986. Retrieved 9 April 2017. 
  8. ^ Pru of Britain in Deal to buy Scottish Life Insurancer. The New York Times, 26 March 1997.
  9. ^ Egg cracks internet for Pru BBC News, 1999
  10. ^ Prudential to swallow the Egg whole. BBC News, 2005.
  11. ^ Pru sells Egg to Citigroup. BBC News, 2007.
  12. ^ Pru pounces on investment rival BBC News, 1999
  13. ^ Prudential goes to New York BBC News, 2000
  14. ^ Insurance boon for health conscious. BBC News, 2004.
  15. ^ Prudential jobs deal with Capita BBC News, 2007
  16. ^ Prudential outsources 450 jobs in Belfast to Capita Group. The Independent, 17 August 2006.
  17. ^ "Prudential gambles on Asia with $35bn deal". theguardian.com. 1 March 2010. Retrieved 18 April 2011. 
  18. ^ "Prudential abandons bid for AIA". BBC News. 2 June 2010. Retrieved 25 March 2012. 
  19. ^ "Prudential Moves into Insurance in Ghana". The Financial Times. Retrieved 5 December 2013. 
  20. ^ "Prudential Increases Capital Base". Business and Financial Times. 25 April 2014. Retrieved 25 April 2014. 
  21. ^ Jones, Sarah (16 September 2014). "Prudential Buys Kenyan Insurer in Second African Purchase". Bloomberg Business. Retrieved 16 September 2014. 
  22. ^ Milmo, Dan (10 March 2015). "Prudential's Tidjane Thiam to take top role at Credit Suisse". The Guardian. Retrieved 10 March 2015. 
  23. ^ Julia Kollewe. "Prudential appoints new CEO on £7.5m pay package". the Guardian. Retrieved 26 March 2016. 
  24. ^ "About us". prudential.co.uk. Retrieved 21 March 2015. 
  25. ^ "Prudential Corporation Asia – How to contact us". Prudential.co.uk. Retrieved 13 December 2013. 
  26. ^ "Jackson National Life Insurance Company - How to contact us". Prudential.co.uk. Retrieved 13 December 2013. 
  27. ^ "Prudential RideLondon raises record-breaking £12 million for charity". Prudentialridelondon.co.uk. Retrieved 26 February 2016. 
  28. ^ "Prudential RideLondon raises record-breaking £10 million for charity". Prudentialridelondon.co.uk. Retrieved 18 December 2014. 
  29. ^ "Prudential renews sponsorship of RideLondon". Prudentialridelondon.co.uk. Retrieved 26 February 2016. 
  30. ^ "£100m investment in Swansea Bay tidal lagoon". BBC News. 20 October 2014. Retrieved 20 October 2014. 

External links[edit]