ROYAL and Sun Alliance announced a 14 per cent fall in half-year profits yesterday.

The group said it was a better balanced business and confident it would meet regulatory capital requirements following the sale of a number of assets, including its closed UK life assurance fund for £850m.

Operating profits from the reshaped group in the six months to June 30 were in line with City expectations, down to £301m from £351m a year earlier.

The company said its remaining UK businesses, including More Than, produced strong first-half results with its combined operating ratio, a key industry measure of profitability, improving by 3.5 per cent to 93.6 per cent.

The ratio, which represents the amount of money spent paying out on claims and in costs for every £1 of premiums taken, improved in both personal and commercial lines.

Andy Haste, chief executive, said: "We have made strong progress on executing our strategy during the half, while producing another set of good results from our ongoing businesses."