Prudential has disclosed a £459m nosedive in the fair value of its US insurance assets for the first quarter of 2008.

Under the controversial financial instruments standard IAS39, the value of the assets were hit by more than £794m in losses and £335m in gains, resulting in an overall drop of £459m.

The company also said that it took a hit of £24m from 'other-than-temporary impairment losses' on the value of its US insurance arm.

The news came as Tidjane Thiam, the insurance giant's new FD faces his first big challenge as he fields questions from the City at an analyst and investor meeting being held this morning.

Prudential said in the statement: 'Jackson's portfolio of debt securities is managed proactively: 21 credit analysts closely and regularly monitor and report on the credit quality of its holdings. Jackson continues to review its investments on a case-by-case basis to determine whether any decline in fair value represents an other-than-temporary impairment.'