Prudential PLC announces 1st Quarter Results

Market Wire, April, 2008

PRUDENTIAL PLC FIRST QUARTER 2008 INTERIM MANAGEMENT STATEMENT

TOTAL GROUP INSURANCE SALES UP 13%

All figures in the table below are for the three months to 31 March 2008,
with comparisons to 2007 at constant exchange rates.


                                      APE                         Growth

Total Group Insurance            GBP729 million                     13%

Total Group Retail Insurance     GBP688 million                     14%

Asia                             GBP375 million                     30%

US                               GBP165 million                     (7%)

UK Retail                        GBP189 million                      4%

UK Total                         GBP189 million                      4%

Asia Asset Management            Net inflows of GBP0.5 billion down 17%

M&G                              Net inflows of GBP0.6 billion down 59%

Mark Tucker, Group Chief Executive said:

"The Group has made a very positive start to the year with overall Group new business up 13 per cent. This continues our strong momentum despite an environment characterised by high levels of uncertainty and volatility. This performance confirms the resilience that we derive from our geographic spread across three regions, and particularly the role of Asia as our leading source of new business.

"Asia's excellent new business growth momentum continues apace. In the US, although difficult market conditions are affecting sales of certain types of retirement products, we remain confident that we shall continue to out-perform the market over the longer-term. UK growth of four per cent is particularly pleasing as we have maintained our value driven focus on writing only the business that meets our profitability criteria.

"Our asset management businesses in the UK and Asia achieved GBP1.1 billion net inflows in extremely tough conditions, with Prudential's financial strength and track record of investment performance enabling us to be a beneficiary of the flight to quality that accompanies economic uncertainty.

"The current economic environment is challenging but I am confident that our geographic diversity, advantaged distribution, product expertise and management capability position us well for future growth. Our prospects for 2008 remain positive."

Asia insurance operations

Prudential's Asian life operations delivered new business APE of GBP375 million representing growth of 30 per cent over the first quarter 2007 continuing the strong growth trend seen in 2007. PVNBP basis sales for first quarter 2008 of GBP2.0 billion are 35 per cent higher than in the same period last year.

Despite the recent global investment market turmoil, demand for linked products has remained strong with the proportion of sales of linked products increasing slightly from 67 per cent of APE for the first quarter of 2007 to 69 per cent of APE in the first quarter of 2008. The main drivers of growth by country during the quarter compared to the first quarter last year were India, with our share of sales at GBP89 million an increase of 41 per cent, Indonesia at GBP40 million up a very strong 90 per cent, Hong Kong at GBP54 million up 50 per cent, Japan at GBP22 million up 100 per cent and Singapore at GBP38 million up 41 per cent.

Product innovation remains key and we have continued to develop our retirement, Takaful and health propositions to deepen our relationship with distributors and customers. Our ability to find creative solutions for our customers and to innovate allows us to grow profitably. New business from health products was 79 per cent ahead of the same quarter last year.

These strong performances came from a wide range of drivers that continue to demonstrate the success of Prudential's regional model. In India the growth reflects the investment in new branches and agency during 2007. Indonesia's agency momentum has continued through the first quarter and this operation now has 51,500 agents, a growth of 71 per cent over the first quarter of 2007, making it Prudential's second largest agency force in the region behind India. Also, the launch of Takaful products continues to be a success with 20 per cent of Indonesia APE now coming from these products. Hong Kong had a very strong first quarter with the successful launch of the new PRUlink Wealth Builder, the operation's first regular premium back-end loaded index linked product, supported by marketing activity for retirement planning. In Japan the exceptional growth has been driven largely by Term Life products where the tax benefits have now been reduced; this operation is now focusing on Variable Annuity products. We anticipate a slow down in new business volumes relative to the term life product. Singapore has also benefited from a one-off boost in single premium sales relating to changes in the Central Provident Fund investment limits effective from 1 April 2008.

Having led Prudential's Asian growth in 2007, Taiwan delivered new business APE of GBP35 million, down eight per cent. Single premium sales were particularly affected by adverse market sentiment towards investment products with a reduction of 43 per cent compared to the first quarter of last year.