INSURER Royal and Sun Alliance, which plans to axe 1,550 jobs by 2008, yesterday posted a 41 per cent leap in profits.

The group, which employs about 650 people in Sunderland, said profits before one-off items rose to £333m in the six months to June 30, following strong performances from all its core businesses.

Royal said the UK remained its most competitive market, but added that its More Than arm increased sales by 17 per cent over the first half of 2005.

The company took steps to boost efficiency earlier this year when it announced plans to axe 1,550 jobs by June 2008, including 1,000 in the UK.

It has since revealed it is closing its Hertford office, with the loss of 150 jobs, during the first half of 2008 and intends to make about 220 redundancies at its Leeds office by next summer.

Earlier this week a spokesperson for the group said no redundancies had been made at its call centre in Sunderland.

The restructuring is expected to slash costs by £70m in the UK in the next two years and £130m globally.

Chief executive Andy Haste yesterday said the group had good momentum with growth in its targeted markets.