No plans to sell life business
Skeoch: Standard Life may sell annuities business
Keith Skeoch, soon to be joint CEO, played down speculation in the market that it would pull out of life assurance when the £11 billion deal goes through, and turn the new company into a fully-fledged asset manager.
Speculation mounted after Standard Life’s insurance business will not have a seat on the new 16 member board.
While dismissing the rumours Mr Skeoch said the company was open to selling the annuity business, which provides an income for life to retirees.
“It is the most capital-heavy part of our business, so I would be quite happy to dispose of that book of business if I can get benefit for shareholders,” he said at a briefing.
“However, at this level of interest rates, the capital would tend to go with the book (and) pricing is quite tight because there are quite a lot of books for sale.”
Specialist annuity providers are often keen to take on back books of business as they can use economies of scale to run them more efficiently, and the policies generate cash.
Fellow Edinburgh insurer Aegon last year sold a £9 billion book of UK annuities to Legal and General and Rothesay Life.
Standard Life will seek investor approval on Monday for its merger with Aberdeen and will shed its index classification as an insurer to become an asset manager.