VOLATILE financial markets are increasingly being accepted by investors as the "new norm", Standard Life finance director Jackie Hunt said, as sales at the pensions and savings giant beat market expectations and assets at its investment arm hit record levels.
The Edinburgh-based insurer recorded £5 billion of new business in its first quarter, down from £5.8bn in the same period last year but ahead of the £4.8bn expected by most analysts.
Standard's group assets under administration grew to £206.8bn from £198.4bn at the end of December.
Ms Hunt said: "In periods of volatility, consumers tend not to make financial decisions and they tend to defer it.
"As we went through the course of the quarter, particularly coming into April, we saw some improvement in sentiment.
"There is a sense of people getting used to the volatility as the new norm."
Standard Life's corporate pension business saw net inflows more than double to £739 million, when analysts expected £326m, thanks to enthusiasm for its Global Absolute Return Strategy, which aims to minimise the volatility of investment returns.
This was offset to some extent by weaker than expected sales at its Canadian and international arms.
Ms Hunt said: "Last year Standard Life had a very strong first half of the year and that was against strong market conditions. In the second half we continued to grow but it was at a more muted pace.
"We have indicated to the market that the shape of these flows will be the reverse [in 2012], so a weaker first half and strong second half."
Ms Hunt said she expects consumer sentiment to improve over the year and that regulatory changes, such as the introduction of auto-enrolment of pensions, when employees will have to actively opt out of company schemes, will also prompt investment activity.
Third party assets managed by Standard Life Investments hit £76.1bn at the end of March.
SLI warned it had lost a £1.8bn mandate in April after a change in strategy by one customer pension scheme, however it said it was low margin business.
Ms Hunt said Standard Life remained on course to make an additional £100m of additional cost savings by the summer.
Standard Life is ready for the retail distribution review when the abolition of commission payments to financial advisers is due to shake up the market.
Chief executive David Nish said: "Standard Life has had a resilient start to 2012 despite the uncertain economic environment and fragile consumer confidence which has affected new business volumes in the first quarter."
Standard Life's shares rose 1.1p to 225.1p.
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