Wealth Manager - Essential news for investment professionals

Register to get unlimited access to all of Citywire’s Fund Manager database. Registration is free and only takes a minute.

RSA plunges as boss quits on third profits warning

RSA plunges as boss quits on third profits warning

The FTSE 100 edged higher providing some relief from the downward momentum of the past six weeks but all eyes were on RSA Insurance Group as the insurer plunged following the sudden resignation of its chief executive.

RSA Insurance Group (RSA.L) shares dived 17% or 18p to 82p after Simon Lee (pictured) stepped down following a third profits warning that confirmed investors' fears of a possible hit to the dividend from the problems in its Irish business.

Chairman Martin Scicluna, who will take on an executive role while Lee's successor is found, said the group would strengthen its reserves by £130 million and pump a similar amount of capital into RSA Insurance Ireland after a review of the division.

Combined with the £25 million in storm damage claims that would be mean a further reduction in 2013 profits, it said. It added that these factors would be taken into account when considering the final dividend for the year.

Shares in RSA have fallen by over a third in 2013, in part because of an unpopular dividend cut by Lee earlier in the year.

The FTSE 100 gained 12 points or 0.2% to 6,456 after yesterday's retreat. Strong recent economic data from the US has inclined more investors to think that the Federal Reserve may start to 'taper' its extraordinary stimulus policies as early as next week.

Chip designer ARM Holdings (ARM.L) led the index, up 4.4% to £10.15 followed by Sports Direct International (SPD.L), recovering 3% after yesterday's slide.

Leave a comment!

Please sign in or register to comment. It is free to register and only takes a minute or two.
Citywire TV
Play Tesco, Japan and the rise of the central banker

Tesco, Japan and the rise of the central banker

 Libby Ashby and leading wealth managers scrutinise the food retail sector, Japan’s consumption tax hike and political risk in the markets.

Play Colin McLean's mid-cap picks

Colin McLean's mid-cap picks

The SVM director and fund manager on his pick of the UK mid-caps.

Play Gervais Williams: the real reason to worry about Quindell

Gervais Williams: the real reason to worry about Quindell

Citywire AA-rated manager Gervais Williams has argued that sentiment is the true danger to Quindell.

Your Business: Cover Star Club

Profile: Psigma's Edinburgh boss on why he is in Scotland long term

Profile: Psigma's Edinburgh boss on why he is in Scotland long term

When Tim Wishart agreed to launch an Edinburgh office for Psigma he was not expecting to  head the company’s first overseas team

Wealth Manager on Twitter