A dramatic 217 per cent increase in new business for Colonial’s mas-ter fund has helped its Australian retail operations turn in a net profit of $152 million for the 1999 half-year.
A dramatic 217 per cent increase in new business for Colonial’s mas-ter fund has helped its Australian retail operations turn in a net profit of $152 million for the 1999 half-year.
Master fund new business topped $769 million during the six-month re-porting period, compared to $203 million in the corresponding period.
New business sales for insurance and superannuation was at $1.3 bil-lion, which was up a strong 196 per cent on the previous half-year.
Colonial chief executive officer Peter Smedley says the integration of Prudential and L & G two years ahead of schedule helped lift the figure.
“We benefited from strong sales growth in all regions, together with the impact of considerable efficiencies flowing from the successful integration of the Prudential and L & G business,” he says.
“Notably, total annualised cost savings in excess of $150 million have now been achieved as a result of the integration.”
The integration has three phases – corporate consolidation, future business platform and conversion of the legacy book. Smedley says the first two phases are now complete and the target for the conversion of the legacy book is to be achieved by 2001.
Colonial has also managed to keep the customer base of the two merged operations. Smedley says. “Sales are up 11 per cent on the combined sales of the three former companies.”
Colonial is also improving its cross-selling ratio, a key component of the allfinanz strategy. In this year-half the cross-selling ratio was 17 per cent, compared to 15 per cent in December, 1998.
Colonial First State also turned in a strong performance, with prof-its up 100 per cent to $34 million for the June half-year.
It now has funds under management totalling $43.5 billion, compared to $29.5 billion in the corresponding half last year. Inflows of ex-ternal funds totalled $4.3 billion in the 1999 half-year.
Overall, all divisions reported stronger figures and this gave the Colonial group an after-tax profit of $212 million, up 54 per cent on the previous half-year result.
