Resolution had originally planned to pay £250m on the back of its performance during the first half of this year but has subsequently been forced to cancel it.
In a statement, the company confirmed: “This decision is based on the estimated capital position of the group as at the end of June 2012 and follows careful consideration of the expected future capital requirements of Friends Life Group.”
Mike Biggs, chairman of Resolution Limited, added: "I understand that shareholders will be very disappointed that the Board has concluded not to return a second £250 million of capital but it would be inappropriate to do so against the backdrop of heightened investment, economic and regulatory uncertainty."
Friends Life Group’s IGCA (insurance group capital adequacy) position dropped from £2.1bn at the end of last year to £1.9bn at the end of Q1 where it remained at the end of June. Its position at the end of H1 includes a £250m dividend to Resolution at the end of March, part of an unchanged dividend policy.
Resolution’s interim results are due on 15 August when it will provide a detailed update on its cash and capital position.
