Old Mutual faces £200m bill

INSURER Old Mutual could end up pouring another £200m into Nedcor if, as expected, the South African bank goes ahead with its rights issue tomorrow.

It loaned its 51 per cent-owned affiliate £160m in December and made provisions for a similar amount to cover acquisition and other costs.

But analysts believe that Nedcor must raise £400m through the issue of new shares, partly to satisfy regulators about its capital strength and partly to fund growth. Old Mutual is likely to pick up half the bill.

Meanwhile, Old Mutual's negotiations continue with the US Securities & Exchange Commission and New York attorney general over its alleged part in America's mutual funds scandal. Tomorrow's annual results announcement appears unlikely to bring fresh developments.