Aviva today announces it has completed a £400 million bulk purchase annuity buy-in transaction with the Trustee of the Marks and Spencer Pension Scheme.
This is the second buy-in transaction between Aviva and the Marks and Spencer Pension Scheme, following a £925 million transaction announced in May 2018*, and it was completed using a pre-agreed ‘umbrella contract’ to support a quick and efficient process. It builds on the important wider existing corporate relationship that Aviva already has with Marks and Spencer, for which it provides health and general insurance.
Aviva will insure the defined benefit pension liabilities of a further 2,293 pensioner members, removing the investment and longevity risk of these members from the Scheme. Members will see no change in the amount of their benefits or the way in which they are paid as a result of the transaction.
The process to select an insurer and negotiate terms was led by Lane Clark and Peacock (LCP).
Jamie Cole, Head of Bulk Purchase Annuity Origination at Aviva, said: "We are delighted to have completed a second transaction with the Marks and Spencer Pension Scheme, building on the great working relationship we already share. The transaction was completed using a pre-agreed ‘umbrella contract’, allowing the efficient completion of the transaction. It provides greater security for Scheme members and again demonstrates the expertise and capability of the Aviva team."
Graham Oakley, Chairman of the Marks and Spencer Pension Trust, said: "We’re pleased to announce the purchase of this additional buy-in policy, providing another important contribution to the Trustee’s ongoing objective of reducing the longevity risk in the Scheme to increase the security of all members’ pensions. Through a collaborative approach with the Company and our existing relationship with Aviva, we were able to act quickly and benefit from the market opportunities seen during 2020 to complete a further well-priced transaction."
Myles Pink, Partner at LCP, said: "The M&S Pension Scheme has been able to take a further step to remove longevity and other risks, building on the thorough preparatory work carried out for its previous buy-in transactions. The Scheme has again demonstrated how well-prepared pension schemes that are flexible in their approach and have umbrella terms in place can efficiently lock into market opportunities when they arise."
Notes to editors:
- For information on how Aviva is helping our people, customers and communities impacted by COVID-19 visit: www.aviva.com/covid-19-our-response/
- We exist to be with people when it really matters, throughout their lives – to help them make the most of life. We have been taking care of people for more than 320 years, in line with our purpose of being ‘with you today, for a better tomorrow’.
- We will focus on the UK, Ireland and Canada where we have leading market positions and significant potential. We will invest for growth in these markets. Our International businesses in Europe and Asia will be managed for long-term shareholder value. We will also transform our performance and improve our efficiency. Our transformation will be underpinned by managing our balance sheet prudently, reducing debt and increasing our financial resilience.
- Total group assets under management at Aviva group are £522 billion and our Solvency II capital surplus is £12.0 billion (HY20). Our shares are listed on the London Stock Exchange and we are a member of the FTSE 100 index.
- For more details on what we do, our business and how we help our customers, visit www.aviva.com/about-us
- The Aviva newsroom at www.aviva.com/newsroom includes links to our image library, research reports and our news release archive. Sign up to get the latest news from Aviva by email.
- You can follow us on Twitter: www.twitter.com/avivaplc/
- You can follow us on LinkedIn: www.linkedin.com/company/aviva-plc
- For the latest corporate films from around our business, subscribe to our YouTube channel: www.youtube.com/user/aviva
- We have a Globelynx system for broadcast interviews. Please contact the Press Officer noted above if you would like to make a booking.