Dutch telecoms group KPN has reported substantial profits after a year of heavy cost-cutting.

LLOYDS TSB Group plc held its final dividend yesterday despite an 18% profit drop, but shares in Britain’s fourth-biggest bank lost ground as investors fretted about its future dividend policy.

Shares in life assurer Friends Provident Plc jumped yesterday after the group reported a rise in third quarter sales and said that it was well placed despite volatile market conditions.