NatWest Group, the excessive avenue banking group, has struck what’s considered the UK’s biggest-ever deal to outsource pension funds to a specialist insurance coverage firm.
The deal is a landmark within the accelerating pattern for firms to insure their pension dangers, with NatWest rating among the many UK’s greatest pension scheme sponsors.
Its group retirement scheme has about £33.6bn in property, whereas it had roughly 190,000 members on the finish of September.
The newest deal was disclosed – irrespective of Rothesay – in NatWest’s third-quarter outcomes assertion printed final month, however has not been publicly reported.
“In September 2024, the Trustee of the NatWest Group Pension Fund entered into a further buy-in transaction with a third-party insurer for some of the liabilities of the Main Section,” the assertion mentioned.
A number of individuals accustomed to the transactions mentioned the counterparty was Rothesay, which declined to touch upon Tuesday.
“The buy-in insurance policies are Fund investments that additional enhance the safety of member advantages by rising safety in opposition to demographic and funding dangers.
“As with other investment decisions there is no change to member benefits and members will continue to receive their benefits directly from the Fund.”
A wave of British and overseas-based multinationals have entered into pension threat switch (PRT) offers during the last decade, turning the market into one of many fastest-growing areas of specialist finance.
RSA, the insurance coverage firm which was damaged up and bought to a number of new house owners, was behind the most important sequence of PRT offers, with £6.5bn of pension liabilities insured.
The most important particular person deal was struck with Boots, which introduced a £4.8bn buy-in cope with Authorized & Common a yr in the past.
Scores of different firms, starting from the Co-operative Financial institution and De Beers to Nationwide Grid and Rolls-Royce Holdings, have turned to PRT offers to handle the dangers related to their retirement schemes extra successfully.
Different massive gamers out there embody Pension Insurance coverage Company and Commonplace Life, which is owned by Phoenix Group, whereas Aviva and Royal London have additionally sought to make inroads into the sector.
