PRUDENTIAL chief executive Tidjane Thiam has been censured and the insurer fined £30 million after it failed to inform the financial regulator of its $35.5 billion (£22.6bn) bid for Asia-based AIA in 2010.

But the Financial Services Authority stopped short of calling for Mr Thiam's dismissal, by ruling that it "made no finding of lack of fitness and propriety" concerning the executive and that the breach of the rules was not intentional.

Prudential has already borne £377 million of costs relating to the deal, which it abandoned due to lack of shareholder support.

Tracey McDermott, the FSA's director of enforcement and financial crime, said: "Prudential, led by Mr Thiam as chief executive, failed to give due consideration to its obligation to inform the FSA of this transaction, which would have had a huge impact on the group, had it gone through.

"That was a serious error of judgement for which Prudential is paying the price."

She added: "Mr Thiam has also been censured in relation to his role in this matter. This case should send a clear message to all board members of their collective and individual responsibility for the decisions they make on behalf of their companies."

Prudential's shares, which also went ex-dividend yesterday, fell 47p or 4.28% to 1051p.

The FSA said it should have been told about Prudential's proposed acquisition well in advance of the leak of the details in February 2010 and said Mr Thiam played a significant role in the decision not to contact the regulator.

The FSA revealed Prudential's advisers, at investment bank Credit Suisse, had advised it to disclose the proposed deal.

It dismissed Mr Thiam's claim that he was not personally culpable and that the case against him was "unwarranted and without precedent", and posed a "grave threat" to his reputation and career.

The FSA said it regarded his conduct to be serious and that he was repeatedly advised of the need to advise the FSA of its intention to purchase what was the Asian business of US insurer AIG although the company feared a leak.

Paul Manduca, the chairman of Prudential, said: "The board has decided to settle this matter in the best interests of the group and all its stakeholders.

"We wish to draw a line under the matter, and to ensure our constructive relationship with our regulators remains good.

"Tidjane acted at all times in the interests of the company and with the full knowledge and authority of the board."