Pru weighs up bid for NPI

PRUDENTIAL, the insurance giant, is considering a bid for National Provident Institution, the mutually-owned life insurer, Sir Peter Davis, chief executive of Prudential, said yesterday.

His comments came as Prudential launched "Egg", a direct banking venture that will sell financial services by internet, phone and mail.

Sir Peter said that the company "will certainly be having a look" at NPI, following the insurer's decision to put itself up for sale on Friday. However, he hinted that Prudential would not participate in an auction for the company. "I doubt if we'll be the people who will pay the top price," he said.

City analysts estimate that NPI could fetch up to pounds 1.5bn. A raft of foreign and UK financial groups including Swiss Life, AMP, Halifax and Abbey National have been mentioned as potential bidders.

Prudential said it would cost about pounds 150m over the next two years to set up Egg, creating 1,500 jobs by 2001. The company will take a pounds 75m charge in both 1998 and 1999, with the first profit contribution expected in 2001. Sources close to the company revealed that the company spent about pounds 1.25m choosing the name of the new venture.

The "Egg" name was selected by marketing consultant CLK, from a shortlist including Oxygen, 360 degrees and Popcorn. Mike Harris, chief executive of Egg, said the company was inspired by names such as Apple computers and Orange mobile phones.

The new service, which starts on Sunday, will initially offer savings accounts, mortgages and loans, with insurance and pensions to be added later.

The company aims to have pounds 5bn funds under management and more than 1m customers within the next five years, with around 400,000 customers in the first 12 months.

The Egg instant access saving account will offer a gross rate of 8 per cent for all deposits - almost 0.5 percentage points higher than the nearest competitor, the company said. Sir Peter said the company would not reap a profit out of the savings account but added that customers were expected to purchase other Egg products.

The new products, which differ from those offered by Prudential Bank, will be aimed at wealthy young professionals and older customers familiar with technological change.

Customers will be able to get personal financial advice and purchase the products on the Egg's website www.egg.com. There will also be a 24- hour, seven-day a week phone service from the company's new call centre in Derby.

Start your day with The Independent, sign up for daily news emails
  • Get to the point
Latest stories from i100
Have you tried new the Independent Digital Edition apps?
Independent Dating
and  

By clicking 'Search' you
are agreeing to our
Terms of Use.

iJobs Job Widget
iJobs Money & Business

SThree: Trainee Recruitment Consultant

£20000 - £25000 per annum + OTE £45,000: SThree: SThree Group have been well e...

Ashdown Group: IT Manager / Development Manager - NW London - £58k + 15% bonus

£50000 - £667000 per annum + excellent benefits : Ashdown Group: IT Manager / ...

Recruitment Genius: Sales Consultant / Telemarketer - OTE £20,000

£13000 - £20000 per annum: Recruitment Genius: Scotland's leading life insuran...

Ashdown Group: Training Programme Manager - City, London

£40000 - £45000 per annum + benefits : Ashdown Group: Training Programme Manag...

Day In a Page

Where the spooks get their coffee fix: The busiest Starbucks in the US is also the most secretive

The secret CIA Starbucks

The coffee shop is deep inside the agency's forested Virginia compound
Revealed: How the Establishment closed ranks over fallout from Loch Ness Monster 'sighting'

How the Establishment closed ranks over fallout from Nessie 'sighting'

The Natural History Museum's chief scientist was dismissed for declaring he had found the monster
One million Britons using food banks, according to Trussell Trust

One million Britons using food banks

Huge surge in number of families dependent on emergency food aid
Excavation at Italian cafe to fix rising damp unearths 2,500 years of history in 3,000 amazing objects

2,500 years of history in 3,000 amazing objects

Excavation at Italian cafe to fix rising damp unearths trove
The Hubble Space Telescope's amazing journey, 25 years on

The Hubble Space Telescope's amazing journey 25 years on

The space telescope was seen as a costly flop on its first release
Did Conservative peer Lord Ashcroft quit the House of Lords to become a non-dom?

Did Lord Ashcroft quit the House of Lords to become a non-dom?

A document seen by The Independent shows that a week after he resigned from the Lords he sold 350,000 shares in an American company - netting him $11.2m
Apple's ethnic emojis are being used to make racist comments on social media

Ethnic emojis used in racist comments

They were intended to promote harmony, but have achieved the opposite
Sir Kenneth Branagh interview: 'My bones are in the theatre'

Sir Kenneth Branagh: 'My bones are in the theatre'

The actor-turned-director’s new company will stage five plays from October – including works by Shakespeare and John Osborne
The sloth is now the face (and furry body) of three big advertising campaigns

The sloth is the face of three ad campaigns

Priya Elan discovers why slow and sleepy wins the race for brands in need of a new image
How to run a restaurant: As two newbies discovered, there's more to it than good food

How to run a restaurant

As two newbies discovered, there's more to it than good food
Record Store Day: Remembering an era when buying and selling discs were labours of love

Record Store Day: The vinyl countdown

For Lois Pryce, working in a record shop was a dream job - until the bean counters ruined it
Usher, Mary J Blige and Will.i.am to give free concert as part of the Global Poverty Project

Mary J Blige and Will.i.am to give free concert

The concert in Washington is part of the Global Citizen project, which aims to encourage young people to donate to charity
10 best tote bags

Accessorise with a stylish shopper this spring: 10 best tote bags

We find carriers with room for all your essentials (and a bit more)
Paul Scholes column: I hear Manchester City are closing on Pep Guardiola for next summer – but I'd also love to see Jürgen Klopp managing in England

Paul Scholes column

I hear Manchester City are closing on Pep Guardiola for next summer – but I'd also love to see Jürgen Klopp managing in England
Jessica Ennis-Hill: 'I just want to give it my best shot'

Jessica Ennis-Hill: 'I just want to give it my best shot'

The heptathlete has gone from the toast of the nation to being a sleep-deprived mum - but she’s ready to compete again. She just doesn't know how well she'll do...