RSA silent on rights issue

ROYAL & Sun Alliance Insurance is expected to post a 17% rise in first-half operating profit this week, but the run-up to Thursday's results announcement has been dominated by rights issue talk.

Shares in Britain's second-biggest general insurer on Friday closed 4% lower at 138-1/2 pence, falling from 154p at the beginning of the week, on rekindled speculation that it would announce a rights issue, possibly with the half-year figures.

Sunday newspapers speculated that the insurer could tap the markets for up to a billion pounds, with one reporting that chief executive Andy Haste would use the money to expand RSA's underwriting business and to shore up its capital position.