Rothesay Life notes today the judgement of the High Court of England and Wales (“the High Court”) in connection with the proposed transfer of a portfolio of annuities from The Prudential Assurance Company Limited (“PAC”), a subsidiary of M&GPrudential, to Rothesay Life.
Rothesay Life and PAC entered into a reinsurance transaction covering a £12.0bn portfolio of annuities on 14th March 2018, with the expectation that this would be followed by an insurance business transfer under Part VII of the Financial Services and Markets Act 2000. The High Court has however declined to sanction the transfer. Rothesay Life is disappointed by the High Court’s decision. The terms of the transfer were reviewed by an independent expert, who was appointed to report to the High Court, who concluded that it would not result in any material adverse effect on policyholders’ security or benefits. Additionally, neither the PRA nor the FCA objected to the transfer. The reinsurance transaction agreements contain provisions to address this outcome and whilst it is not the preferred or optimal outcome for either party, it will not have a material impact on Rothesay Life as a whole. Rothesay Life and PAC are committed to a long term relationship irrespective of the outcome of the proposed insurance business transfer
Rothesay Life and PAC have been granted leave to appeal by the High Court.
We look forward to continuing our strong relationship with M&GPrudential.
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