News Release

17 March 2009

Friends Provident plc – Preliminary results for the year ended 31 December 2008 (unaudited)

Strong capital position; good progress on strategy

Financial highlights

• Insurance Groups Directive (IGD) surplus remains strong, estimated at £0.85 billion at 31 December 2008 (31 December 2007: £1.3bn) and estimated at £0.8bn at the end of February 2009
• Final dividend of 2.6p per share bringing full year dividend per share to 3.9p*
• High quality of investments and focused strategy position business well to continue turnaround
• IFRS net asset value per share excluding goodwill of 77p (2007: 96p)
• EEV underlying profit up to £420 million (2007: £16m) on our established market-consistent approach
• IFRS underlying profit of £27 million (2007: £44m) before £217m (2007: £90m) addition to corporate bond default reserves

Operating highlights

• International contribution from new business of £111 million (2007: £110m)
• UK business restructured to align operations to corporate and individual customer segments
• £25 million annualised cost savings at 31 December 2008, well on track to deliver £40 million of annualised savings in the UK by end of 2009

Trevor Matthews, chief executive officer, said:

“We are maintaining our capital strength, our prudent approach to accounting and our dividend policy, all of which position us well in the current conditions.

“The company is reorganised, the leadership team is strengthened, and operational momentum is building. We have taken significant costs out of the business, sharpening our competitive edge in the key markets we identified at the start of 2008.

“2009 will be a tough year for economies worldwide, but we will continue to enhance our product range and build a business primed to broaden our distribution and grow market share both in the UK and abroad.”

Financial Summary

* Final dividend of 2.6p expected to be paid by new holding company following group restructuring

** As defined within Appendix 1

*** Embedded value for 2007 is stated on a pro forma basis, including an uplift of the net asset value attributable to F&C to the market value of the stake

Full press release

- Ends -

Notes to editors

1. An interview with Trevor Matthews, chief executive officer, will be available to view in video, audio and text formats at www.friendsprovident.com and www.cantos.com from 7.00am today.

2. An analyst presentation will take place at 9.30am today at JP Morgan Cazenove, 20 Moorgate, London, EC2R 6DA.

3. The analyst presentation will be webcast live from 9.30am and on demand from 2.00pm on the Friends Provident website: www.friendsprovident.com/results

4. The presentation slides will be available from 9.30am today on www.friendsprovident.com/presentations

5. For more information on Friends Provident including, photos, awards, fast facts, presentations, and media contacts please visit the media section at www.friendsprovident.com/media

6. Financial reporting dates

7. Certain statements contained in this announcement constitute 'forward-looking statements'. Such forward-looking statements involve risks, uncertainties and other factors, which may cause the actual results, performance or achievements, from time to time, of Friends Provident plc, its subsidiaries and subsidiary undertakings or industry results to be materially different from any future results, performance or achievements expressed or implied by such forward- looking statements. Such risks, uncertainties and other factors include, among others, adverse changes to laws or regulations; risks in respect of taxation; unforeseen liabilities from product reviews; asset shortfalls against product liabilities; changes in the general economic environment; levels and trends in mortality, morbidity and persistency; restrictions on access to product distribution channels; increased competition; and the ability to attract and retain personnel. These forward-looking statements are made only as at the date of this announcement and, save where required in order to comply with the Listing Rules, there is no obligation on Friends Provident plc to update such forward- looking statements.

8. We received a large number of awards in 2008, showing continued recognition of the quality of our products and service:

• FTAdviser.com – Online Service Awards 2008. Friends Provident received the 4 Star award for Life & Pensions Provider
• Money Marketing Financial Services Awards 2008. Friends Provident came 3^rd in the category of Company of the Year

eBusiness

• Investment Life & Pensions Moneyfacts 2008 Awards. Winner of Best Online Service
• FTAdviser.com – Online Service Awards 2008. Friends Provident received the 5 Star award for Investment Providers and Packagers
• Financial Technology Research Centre – e-Excellence Ratings 2008. Friends Provident received numerous Triple E ratings: Individual Pensions, Group SIPP, Life Protection, Critical Illness, Income Protection and Group Personal Pensions including Stakeholder for both new and existing business

Pensions

• Incisive Media – Gold Standard Awards 2008. Friends Provident won the Group Pensions category
• European Pensions Awards 2008. Friends Provident was awarded Pension Provider of the Year

Protection

• Online Finance Awards 2008. Friends Provident was awarded Best Online Protection Provider
• Incisive Media – Gold Standard Awards 2008. Winner of Protection category
• Health Insurance Awards 2008. Friends Provident was named Best Individual Income Protection Provider

Investments

• Investment Life & Pensions Moneyfacts 2008 Awards. Friends Provident won award for Best Ethical Investment Provider