Standard Life has overcome last minute wrangles with the UK Financial Services Authority (FSA) and will press ahead with its planned flotation next year. This will pave the way for windfalls for 2.4 million of the mutual's members, up to 100,000 of whom are based in the Republic.

The Edinburgh-based group is understood to have satisfied the FSA on assurances it gave last year when it announced that it was unable to fulfil its mortgage promise to 600,000 holders of endowment policies.

However, it will continue to work with the chief City regulator on the fine details of its demutualisation plans.

Some 2.4 million Standard Life members will qualify for free shares, with the average amount expected to be in the high hundreds of pounds.

Standard Life said yesterday that members whose policies matured between today and a general meeting scheduled for May or June, could still qualify for free shares.

It plans to put a proposal to the meeting, amending its rules, which would enable these members to qualify.

It said customers taking out new with-profit policies from today would not qualify for membership of the mutual.

However, since March 31st, 2004, those taking out with-profit policies have not been eligible to vote on the proposed demutualisation and would not qualify for windfall shares.

Standard Life has declined to speculate on its possible market valuation.

However, analysts say it could have an embedded value - a measure of the worth of in-force life assurance policies - of about £3 billion (€4.37 billion).

It is also planning to raise at least £1 billion in the initial public offering, scheduled for July. Analysts estimate that this could give it a market capitalisation of £4-£7 billion.

Brian Stewart, chairman of the mutual, said yesterday: "There remains a lot of work to be done before our proposals can be put before members, but I believe Standard Life has an exciting and successful future. The proposed demutualisation and flotation are key stepping stones in realising our ambitions."

Standard Life was forced to reverse its long-standing opposition to demutualisation last year after clashing with the FSA over the measurement of its solvency.

It also changed its chief executive and sold £7.5 billion worth of shares.

The mutual will today begin writing to members to confirm addresses and policy details.- (Financial Times Service)