Australia’s life insurance market has plummeted into more strife after trans-Tasman insurer and fund manager Tower announced it will make a first-half loss of about $159.6 million. As a result investors have stripped about $110 million out of the company’s share value.

Tower will seek to raise $NZ200 million ($177 million) in fresh funds to overcome the debt, but the group isn’t saying much until tomorrow.

Tower expects operating profit for the first half of the year to be up to $5.3 million, and it intends to reduce the carrying value of “certain group companies and other assets” by $168 million.

Tower Chairman Olaf O’Duill says the review of Tower’s financial position that has been undertaken and the proposed recapitalisation “will place Tower in a strong position for future growth and profitability”.

Standard & Poor’s says it will maintain its credit watch on the group with negative implications. And analysts expect Tower employees are in line for more bad news, with more job cuts on the way.