The Standard Life Assurance Co. of Canada today reported that 2008 year-end results show strong sales growth and a resilient balance sheet, even as net income plunged.

The company is part of the group Standard Life plc, which published its 2008 year-end results earlier today.

Net income at Standard Life Canada fell to $3 million in 2008 from $204 million in 2007, and was affected by the unprecedented market challenges, the company said.

The drop in net income was largely due to investment losses and other related charges resulting from the adverse market conditions in the second half. Unrealized losses on bond and equity investments of $124 million were fully reflected in the stated net income due to the accounting treatment Standard Life Canada uses, the company said.

Premiums and deposits rose 7% to $4.7 billion in 2008 compared to $4.4 billion in 2007.

“In Canada, Standard Life demonstrated continued resilience in the face of challenging market conditions in 2008,” said Joseph Iannicelli, president and CEO. “Despite the difficult economic environment, our financial results testify to our focus on growth in savings, retirement and insurance products, as well as to our commitment to operational and capital efficiency.”

Net inflows from clients increased eightfold to $665 million in 2008 compared to $84 million in 2007, while client retention remained high at 94.6% in 2008 compared to 95.7% in 2007. These two results improved the value of assets under administration, but were offset by the negative effects of turbulent capital markets. Assets under administration totalled $32 billion as at Dec. 31, 2008 compared to $35 billion a year ago.

“Standard Life in Canada was able to maintain a strong solvency ratio without requiring additional capital from markets or the parent company, due to our prudent, conservative approach to investments and product design that proves even more appropriate in times like this,” said Iannicelli.

The company maintained a Minimum Continuing Capital Surplus Ratio (”MCCSR”) of 198%, without any need to access additional capital. The MCCSR is well within regulatory requirements, Standard Life Canada said.

Separately, Standard Life Canada announced that Sir Sandy Crombie, group chief executive of Scotland-based Standard Life plc and director of the company, will assume the position of chairman of the board of directors of Standard Life Canada.

Crombie will replace Jocelyn Proteau, who will retire as chairman of the board, and director of the board of Standard Life plc.

In addition, Bill Black, currently serving as an independent non-executive director on the company’s board will be appointed to the newly created role of deputy chairman.

Maurice Forget, also a non-executive director, will retire as well, after 20 years of dedicated service on the Standard Life Canada board. All changes will be effective on May 15.

Following these changes, the board of the Standard Life Canada will be comprised of four independent non-executive directors, two executive directors and two affiliated directors, including the chairman.

IE