Further £750m pension risk transfer transaction for ICI Pension Fund
Legal & General Group Plc (“Legal & General”) today announced it had completed a £750 million Pension Buy-In transaction for the ICI Pension Fund (“ICI PF”).
Legal & General Retirement sales year to date across bulk annuities, individual annuities and lifetime mortgages are £4.75 billion, (£4 billion in H1 2016 compared to £1.36 billion in H1 2015).
Legal & General has now executed bulk and individual annuity business in 2016 of £4.5 billion year to date, compared to the 2015 full year annuity sales of £2.7 billion. This is partly made up of the £2.9 billion Aegon back-book transaction in May, and £250 million of pension risk transfer business conducted in June during the Referendum period.
Legal & General and ICI PF executed the £750 million pension risk transfer deal shortly after the EU Referendum, working together quickly to make good use of market opportunities. ICI PF has now executed £5 billion in pension risk transfers with Legal & General since 2014.
Large pension funds are moving towards an incremental approach to pension risk transfer. Pensioner buy-ins, top-slicing and longevity insurance are all becoming steps in this incremental approach and so allow insurers and pension schemes to form mutually helpful strategic relationships.
Commenting on the latest transaction, Cheryl Agius, Head of Strategic Pension Risk Transfer, Legal & General Retirement (photo) said: “The strength and depth of our relationship with ICI Pension Fund enabled us move fast when the market opportunity presented itself. The result is a further step forward in the de-risking programme which we are helping the ICI Pension Fund Trustees to deliver for their scheme members.”
For more information please contact:
Head of Group Corporate Communications
t: +44 (0) 2031 242095
m: +44 (0) 7515 324001
Investors should contact:
Laura Doyle, Head of Investor Relations
Tel: 020 3124 2088
Stephen Thomas, Investor Relations Manager
Tel: 020 3124 2047
Notes to editors:
The Trustees of the ICI PF were advised on all of these transfers by LCP and Allen & Overy.
Legal & General Group Plc:
Established in 1836, Legal & General is a leading provider of insurance, savings and investment management products in the UK. The Group has a market capitalisation of £11.4bn (as at 18 July 2016) and is responsible for investing £746bn worldwide (as at 31 December 2015) on behalf of investors, policyholders and shareholders. Legal & General has over seven million customers in the UK for life assurance, pensions, investments and general insurance plans and over one million customers in the US who rely on us for life assurance. In 2015, Legal & General's operating profit (on the IFRS basis) was £1,455m and adjusted earnings per share were 18.58p for the period, an increase of 14% and 11% respectively.
For more information on Legal & General, please see http://www.legalandgeneralgroup.com/
Legal & General Retirement
Legal & General Retirement has participated in the insurance solution pension de-risking market for nearly 30 years and was voted Risk Reduction Provider of the Year at the 2016, 2014 and 2013 UK Pensions Awards and Risk Management Provider of the Year at the Pensions Age Awards 2014. Legal & General was also voted Insurer of the Year at the 2014 Insurance Risk Awards, Winner of the Engaged Investor Trustee Awards in 2015, and Derisking Provider of the year at the Pensions Expert's Pension and Investment Provider Awards 2015. Legal & General provides annuities to pensioners and has completed a number of landmark transactions. These include the $900m deal with Philips in the US in partnership with The Prudential Insurance Company of America in 2015, the £3bn bulk annuity arrangement with the ICI Pension Fund, the largest bulk annuity policy arranged by a pension scheme in the UK to date, secured in March 2014, the UK's largest medically underwritten deal for £230m with Kingfisher in December 2015 and the £3.2bn longevity insurance transaction with the BAE Systems 2000 Pension Plan in February 2013. Legal & General manages £43.4bn of annuity assets as at 31 December 2015.
Legal & General offers a range of de-risking solutions, which includes buyout, buy-in, longevity insurance and liability-driven investment (LDI), to pension schemes of all sizes. Legal & General is also able to tailor a combination of LDI and longevity insurance to provide "DIY buy-in" solutions. Legal & General has expertise in investment management, all aspects of defined benefit provision as well as an in-depth understanding of mortality trends and longevity risk. The excellent services we are able to provide also include payroll, administration and communications services. LGR is multi award winning business, and in 2016 has been awarded: UK Pensions Awards – De-risking Provider of the Year, aiCIO’s European Innovation Awards – Swap and Buy-in Provider of the Year, and European Pensions Awards – Buyout Firm of the Year.
This announcement may contain certain forward-looking statements relating to Legal & General, its plans and its current goals and expectations relating to future financial condition, performance and results. By their nature, forward-looking statements involve uncertainty because they relate to future events and circumstances which are beyond Legal & General’s control, including, among others, UK domestic and global economic and business conditions, market related risks such as fluctuations in interest rates and exchange rates, the policies and actions of regulatory and Governmental authorities, the impact of competition, the timing impact of these events and other uncertainties of future acquisition or combinations within relevant industries. As a result, Legal & General’s actual future condition, performance and results may differ materially from the plans, goals and expectations set out in these forward-looking statements and persons reading this announcement should not place reliance on forward-looking statements. These forward-looking statements are made only as at the date on which such statements are made and Legal & General Group Plc does not undertake to update forward-looking statements contained in this announcement or any other forward-looking statement it may make.