Legal & General Group Plc has announced on Thursday (13) that it has completed a £4.4 billion buy-in for British Airways PLC’s pension scheme, Airways Pension Scheme (APS), covering nearly 22,000 pensioners.
This is the largest ever bulk annuity policy arranged with a UK pension scheme and also included the conversion of existing longevity insurance into a bulk annuity.
As announced at the half-year results, the UK pension risk transfer (PRT) market continues to demonstrate a high level of activity with Legal & General actively quoting on more than £20bn, of which more than £7bn were in exclusive negotiations at the time. Since then, Legal & General has completed £4.8bn of UK PRT transactions, including the APS buy-in, and is now actively quoting on £27bn of UK PRT deals. Additionally Legal & General has continued to show strong momentum in International PRT, completing £191 million of transactions since the end of June.
In aggregate, Legal & General has completed £6.0bn of global pension de-risking transactions year to date (UK PRT: £5.3bn, International PRT: £0.4bn, Longevity Insurance: £0.3bn). The financial metrics and Solvency II capital strain of these transactions are in line with previous levels reported by Legal & General.
“This transaction also included the conversion of existing longevity insurance to a bulk annuity, demonstrating Legal & General’s ability to deal with a complex situation and offer innovative solutions drawing on the broad experience and capabilities of the wider Legal & General Group,” said Laura Mason, CEO Legal & General Retirement Institutional.
