Three More Years: Pru Chair To Serve New Term

Prudential will attempt to assuage investors' concerns about the departure of its chief executive by retaining Paul Manduca, its chairman, for a further term at the insurance giant.

Sky News understands that Prudential has briefed leading shareholders in recent days that Mr Manduca has agreed to stay on until 2018.

The development comes as the London-based insurer continues to discuss with regulators the plan to appoint Mike Wells, the head of its US operation, as its new group chief executive.

Mr Wells, who is president and CEO of Jackson National Life Insurance, is set to replace Tidjane Thiam, who is leaving to become chief executive of Credit Suisse, the Swiss banking giant.

The retention of Mr Manduca, who became Prudential chairman in May 2012, for a further three years is expected to be disclosed in its annual report later this month, a major investor said on Friday.

It will provide important continuity at the top of a company which has been lauded by the City for its performance in recent years.

If ratified by the Prudential Regulation Authority (PRA), Mr Wells' appointment will put him at the helm of a vast group with operations in the UK, US and Asia.

He would be the first American to run arguably the best-known of the major UK insurers, which has a market capitalisation of almost £45bn.

Mr Wells would take over at a crucial time, with a new European regulatory framework and a rulebook imposed by the PRA to strengthen accountability among senior managers in the insurance sector.

Mr Thiam's exit surprised the City, following his strong recovery from one of the most disastrous takeover attempts in recent British corporate history.

In 2010, Prudential attempted to buy AIA, a major Asian insurer, in a deal worth $35bn, but the deal was thwarted by objections from shareholders and regulators.

The defeat left Mr Thiam dismayed, and his sense of injustice was compounded when the then Financial Services Authority fined the company and censured him for failing to keep it properly informed about the AIA plans.

AIA, which is run by Mr Thiam's predecessor as the Pru's chief executive, Mark Tucker, has seen its value soar since listing on the Hong Kong Stock Exchange.

Mr Wells is already a member of Prudential's board, which makes a decision by the PRA to reject his appointment as the group chief executive unlikely in the extreme.

He has held senior roles at Jackson for 15 years and joined the Pru's board in 2011.

Prudential declined to comment.