FPI J98 Momentum AllWeather Suspension (Jan 2009)

J98 – Momentum AllWeather Liquidity Fund

We have recently been informed by Pioneer Alternative Investments ("PAI") that a significant percentage of underlying assets within certain fund of hedge fund portfolios it manages, have had redemption suspensions imposed. The hedge fund industry has been particularly impacted during these unprecedented global market conditions and have suffered a wave of liquidity requests as geared investors have been forced to unwind their positions. The Momentum AllWeather Liquidity Fund, is one of the PAI managed funds that have been impacted by this liquidity restriction and they have also taken the action of closing the fund for any new subscriptions.

This is the underlying vehicle the above Friends Provident International Limited (FPIL) mirror fund invests in. Whilst existing investors are unaffected by these liquidity restrictions, the position for those who wish to redeem their units or place new money into the fund has changed. We are consulting with PAI on their recent proposals.

As a consequence we are closing the fund for new investments and redemptions for an initial review period of 90 days for all new or outstanding instructions received on or after Tuesday 6th January 2009.

During this review period we can properly investigate the fairest solution for our policyholders and will write to you again with an update on the position.

FPIL will be honouring all outstanding redemption and subscription requests received up until the 6th January 2009 weekly dealing cut-off in full. The underlying fund will remain actively managed by PAI and the mirror fund will continue to price on a weekly basis throughout the initial review period as normal.

We are aware that these arrangements will cause inconvenience and frustration but please be assured that we are endeavouring to treat all policyholders in the fairest possible way in light of the restrictions that have been imposed on us by the fund managers.

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