Announcement regarding Capital Return

20 July 2012

RESOLUTION LIMITED ("Resolution" or the "Company")

Cancellation of targeted £250 million capital return

The Company has determined that it would be inappropriate to make the £250 million capital return originally targeted for the first half of 2012 and consequently announces its cancellation.

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 against a backdrop of heightened investment, economic and regulatory uncertainty.

The group's capital position remains robust. Friends Life Group had an estimated IGCA surplus of £1.9 billion as at 30 June 2012. The Company's dividend policy remains unchanged.

The Company will provide a detailed update on its cash and capital position and associated sensitivities with its interim results on 15 August 2012.

Mike Biggs, Chairman of Resolution Limited commented: "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."

Enquiries:

Investors/analysts

Neil Wesley, Resolution Operations LLP +44 (0)20 3372 2928

Media

Alex Child-Villiers, Temple Bar Advisory +44 (0) 7795 425580

Notes to editors:

Resolution's current restructuring project is in the UK life and related asset management sectors (the "UK Life Project").

The Company's ordinary shares were admitted to the Official List and to trading on the main market of the London Stock Exchange in December 2008. The Company transferred to a Premium Listing as it completed its first acquisition, Friends Provident Group plc, on 4 November 2009 and is subject to those provisions of the Listing Rules that apply to overseas companies with a Premium Listing. The Company completed its second acquisition, the majority of the AXA UK life business, on 15 September 2010. On 31 January 2011, the Company completed its third acquisition, the shares and business of Bupa Health Assurance Limited.

A copy of this announcement is and will be available, subject to certain restrictions relating to persons resident in restricted jurisdictions, on the Company's website www.resolution.gg