L&G wins £2.5bn bulk annuity contract

Legal and General has secured a bulk annuity contract removing £2.5bn liabilities from TRW Automotive’s balance sheet and insuring more than 22,000 of the scheme’s pensioners.

The scheme previously implemented a liability driven investment strategy with Legal and General Investment Management in 2007.

This £2.5bn transaction follows the £3bn bulk annuity contract with the ICI Pension Fund that Legal and General secured earlier this year.

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L&G has now written £8.3bn of total annuity transactions to date in 2014.

Earlier this month, L&G reported its individual annuity sales in the third quarter of this year reduced to £125m, down 61 per cent, with total sales in the nine months to September of £508m, down 53 per cent compared with the first nine months of 2013.

However, bulk annuity sales increased 29 per cent to £3.4bn in the third quarter, compared with £2.6bn a year ago.

Kerrigan Procter, managing director of Legal and General retirement, said: “2014 has been a landmark year in the pension de-risking market with the two largest bulk annuity transactions in the UK, both with Legal and General.

“These demonstrate the strength of Legal and General’s tailored pension de-risking solutions.”