Double blow floors Pearl parent

SHARES in AMP, the company behind Pearl Assurance, hit a record low amid fears about risk controls in its UK-based asset manager Henderson Global.

Investors were also spooked by reports that Citigroup is predicting AMP will need to raise more cash to shore up its UK life funds.

Nigel Pittaway of Citigroup reportedly said that an additional capital raising to facilitate the demerger of its UK operations was 'a significant risk'.

Sydney-listed AMP company declined to comment. But its chief executive has repeatedly said AMP will not have to go to the market for further capital.

AMP crashed more than 8% in Sydney, hitting a record low of A$4.37 (£1.76), despite the company's attempts to soothe fears over Henderson. A leaked internal audit said Henderson's risk controls exposed it to the risk of 'significant financial and reputation damage'.

AMP said some of the claims were inaccurate and that the risks referred to represented management processes that were being improved. 'It was found that some of these improvements were not yet fully operational,' the company said.

The group wants to want use Henderson as the core asset of its UK company after demerger - a move desperately needed for AMP's survival following British life insurance losses.