Pension buy-ins and buy-outs hit record £34bn over the past year as landmark deals complete

9 August 2019

Lane Clark & Peacock publishes on its website:

“Analysis by Lane Clark & Peacock (LCP) shows that total buy-in and buy-out volumes by UK pension schemes reached £17.6bn in H1 2019 (H1 2018: £7.8bn) taking total volumes to £34.0bn over the 12 months to 30 June 2019. This is the busiest 12-month period ever recorded, more than doubling the £14.9bn in the previous 12 months (to 30 June 2018).

LCP’s analysis is based on insurer half year figures, including Aviva’s results today as the final insurer to report. Other findings in LCP’s analysis include:

70% of H1 2019 volumes were written by Legal & General (L&G) and Pension Insurance Corporation (PIC) who between them absorbed most of the increase in volumes. L&G wrote £6.3bn (H1 2018: £0.5bn) and PIC wrote £6.0bn (H1 2018: £3.3bn) giving them a 36% and 34% market share respectively.

The record £34.0bn volumes in the past 12 months included the three largest buy-in/out transactions ever: the £4.6bn pensioner buy-out by Rolls Royce in June 2019, the £4.4bn pensioner buy-in by British Airways in September 2018 and the £3.4bn buy-in by British American Tobacco in May 2019. There have been two further £1bn plus transactions to date in 2019 by the schemes of Marks & Spencer and Commerzbank.

The £7bn longevity swap announced this week by HSBC is the second largest longevity swap ever but the first such transaction in the past 12 months.”

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