Life Insurance  

Phoenix profits boosted by closed life books cash

Phoenix Group Holdings announced year to end of September cash generation of £734m, suggesting the group is on track to achieve the top end of its 2013 cash generation target of £650m to £750m.

The manager of life assurance policies in closed books reports a further £300m has been generated from insurers during October 2013, resulting in total year to date cash generation of £734m.

The estimated Phoenix Life free surplus, which represents excess capital over the life companies’ minimum requirements and the capital policies, increased by £324m to £730m at 1 October.

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Phoenix’s investment firm, Ignis, reported £1.4bn of net third party asset inflows in the nine months to 30 September.

Ignis had also benefitted from Phoenix transferring about £5bn of annuity in-payment liabilities to Guardian Financial Services.

About £1.1bn of assets relating to the annuity transfer transaction that took place with Guardian were transferred back to Ignis during this period for investment management, the results revealed.

Total group assets under management were £68.7bn at 30 September.

Bosses used the results announcement to confirm discussions regarding a possible combination of Phoenix Group and Swiss Re’s UK Admin Re Business Unit were still progressing.

If successful, Clive Bannister, group chief executive of Phoenix, said the transaction is expected to result in Swiss Re holding a minority shareholding in Phoenix Group.

But he warned there could be “no certainty” that these discussions will lead to any transaction or any certainty as to the terms upon which any such transaction might proceed.

He added further statements would be made if and when appropriate.

FTAdviser first revealed talks were taking place between the two closed life book managers back in July.