Standard Life Financial Inc. said Tuesday that, premiums and deposits grew 13% to $1.2 billion in the quarter ended June 30, underpinned by successful sales in its core markets.

Net income amounted to $23.8 million, increasing year-to-date profit to $77.9 million from $64.9 million a year ago.

Headquartered in Montreal, Standard Life Financial is the Canadian subsidiary of the UK-based long-term savings and investment group Standard Life plc. Earlier Tuesday, Standard Life plc published detailed results for the six months ended June 30, and announced a 4.8% increase on the prior year of its interim dividend to 7 cents.

“I am pleased with the way Standard Life has adapted to the changing market conditions and delivered growth in Canada for a third consecutive quarter,” says Joseph Iannicelli, president, Standard Life Financial.

“We are particularly encouraged by our gains in market share and the momentum we’re building in our core segments of retail investment funds, defined contribution retirement plans and disability management,” he adds.

The increase in premiums and deposits for Standard Life’s retail solutions in the second quarter was mainly driven by a higher demand for its segregated funds offering. Segregated and mutual fund sales grew by 62% to $27.9 million from $17.2 million a year ago, significantly outpacing the market.

Overall, group premiums and deposits were 16% higher at $858.3 million vs. $737.1 million in the year earlier period. despite slower market activity.

The Standard Life Assurance Company of Canada maintained its capital and financial strength, reporting a solvency ratio of 217%, without any need to access additional capital.

Standard Life Financial maintains its positive outlook for the rest of 2010, although the external environment is likely to remain uncertain, the company says.

More specifically, the insurer expects continued success in its core segments in Canada. However, it does remain cautious about the short-term prospects in the group savings and retirement market and the impact of equity market volatility on retail investors’ confidence.

As part of a group-wide transformation program to be better aligned with customer needs and the changing environment, Standard Life says it will adopt a new organizational structure in the fall. In Canada, this means moving from a structure that is currently divided by line of business to one divided by functional expertise.

“Our business is doing well and we’re delivering against our targets. Our goal is to create a fitter, more flexible business that can identify and capture new opportunities, putting customers at the heart of everything we do,” says Iannicelli.

IE