UK insurer Prudential to pay over 20 mn pounds in bonuses: report

UK insurer Prudential to pay over 20 mn pounds in bonuses: report

London: British insurer Prudential Plc has agreed to pay out bonuses worth over £20 million to stop staff attrition at its Asian business, which the company is to buy from AIG, says a media report.

Recently, Prudential entered into a deal to acquire AIA, the Asian operation of American insurer AIG, for over £23 million.

“Prudential has agreed to pay out more than £20 million in bonuses to stop staff defections at the giant Asian business it is trying to buy," The Sunday Times has reported.

According to the publication, two senior executives at AIA quit last week in protest against the takeover, as they had wanted to float the business on the Hong Kong Stock Exchange rather than sell it.

“Steve Roder, the finance director, and Peter Cashin, the chief legal counsel, were expected to make paper fortunes from the listing," the report noted.

Prudential and AIG have now created a new bonus scheme for other executives worried about missing out on the windfall.

“It is understood the scheme is worth ‘tens of millions of dollars´ shared between a large number of executives.

“Although the cash will be paid out by AIG before the deal concludes, Prudential has agreed to the payments. The scheme may also require a rubber stamp from the US government’s pay tsar," the publication said.

The US government has about 85% stake in AIG and would retain an 11% shareholding in the new enlarged Prudential once the deal goes through.