Resolution turns over a new leaf

While the abandonment of disposal plans will perhaps disappoint some shareholders, who will have been hoping that such deals could unlock some of the value within the life insurer - the shares trade almost below embedded value - the adoption of a new structure could help it shake off some of the regulatory uncertainty that has depressed its share price. The business is currently managed by an offshore operating company run by founder Clive Cowdery, with only non-executives in its UK-based operating company, but will now employ a conventional board which Mr Cowdery will join.

However, there was no sign that a postponed £250m special dividend will be paid any time soon - although the group's capital surplus remains robust, it's maintaining a £400m "prudence buffer" given the uncertain market backdrop and currently only has £619m of available shareholder cash. Still, Resolution's board stuck by its promise of a progressive dividend policy, expressing confidence that continued integration of Friends Life is on track, and this should help the life assurer reach its annual target of £400m of distributable cash.

Broker Investec Securities expects full-year operating EPS of 34.4p (from 50.4p in 2011).