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Tucker is expected to announce plans this week to sell insurance products from the Pru's M&G business to Egg customers, drawing the online bank closer to its parent company.

But it is thought the scheme could go further with Prudential, which owns 79% of stock market-listed Egg, buying out other shareholders altogether.

Tucker took over as chief executive in March after Jonathan Bloomer was ousted. Bloomer had planned to sell Egg, but no one came forward with a bid acceptable to the Pru.

The Egg plans will be overseen by Nick Prettejohn, head of Lloyd's of London insurance market, who was Egg shares fell to 97½p last week, while shares in Prudential were down to 474½p.

The drop marked the lowest price for both shares since May and reflected the market's expectation that Egg would not now be sold. Egg shares could rise again if Tucker confirms plans to buy up the 21% of the company held by private investors.

The future of Egg is one of a number of thorny issues facing Tucker. Also looming is a multi-million pound liability in Taiwan that some analysts say could put a large dent in the group's finances.

In 1999, Prudential bought Taiwanese insurer Chinfon Life. The group's books included policies already sold to Taiwanese customers guaranteeing returns of at least 5% a year.

With interest rates in Taiwan running at only two per cent, Prudential has been left facing a huge shortfall. It set aside £230m for the liability in June, but analysts believe the final bill could be much higher.

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