Canada NewsWire
TORONTO, Feb. 27, 2023
TORONTO, Feb. 27, 2023 /CNW/ - Intact Financial Corporation (TSX: IFC) (Intact, IFC or the Company) today announced that the RSA UK Pension Trustees have entered into an agreement with Pension Insurance Corporation plc (PIC) for Bulk Purchase Annuities (or "buy-ins") with respect to £6.5 billion of RSA UK pension plan liabilities. The buy-ins fully insure the defined benefit liabilities of the Royal Insurance Group Pension Scheme and the Sal Pension Scheme (the "Pension Schemes") to PIC, a specialist insurer of defined benefit pension schemes.
"The current market environment provides an excellent opportunity to remove UK pension exposure on IFC's balance sheet," said Louis Marcotte, Executive Vice President and Chief Financial Officer, Intact Financial Corporation. "This transaction represents a cost-effective de-risking, with the upfront payment approximately equal to the remaining annual funding contributions and the capital released. Meanwhile, the key metrics related to our RSA acquisition continue to be very strong, and the buy-ins strengthen our ability to pursue growth opportunities."
The transaction fulfills several strategic objectives:
IFC will facilitate this transaction through an upfront contribution to the Pension Schemes of approximately £500 million.
Intact were advised on the transaction by Lane Clark and Peacock (LCP) and Slaughter and May.
For more details on this transaction, please visit the Events and Presentations section of the Intact Financial Corporation website.
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1 This measure is a non-GAAP ratio, which does not have a standardized meaning prescribed by IFRS and may not be comparable to similar measures used by other companies in our industry. For historical information about these measures, please see Section 36 – Non-GAAP and other financial measures in our Management's Discussion and Analysis for the year ended December 31, 2022 which is available on our web site at www.intactfc.com or on SEDAR at www.sedar.com. |
Intact Financial Corporation (TSX: IFC) is the largest provider of property and casualty (P&C) insurance in Canada, a leading provider of global specialty insurance, and, with RSA, a leader in the U.K. and Ireland. Our business has grown organically and through acquisitions to over $21 billion of total annual premiums.
In Canada, Intact distributes insurance under the Intact Insurance brand through a wide network of brokers, including its wholly-owned subsidiary BrokerLink, and directly to consumers through belairdirect. Intact also provides affinity insurance solutions through the Johnson Affinity Groups.
In the US, Intact Insurance Specialty Solutions provides a range of specialty insurance products and services through independent agencies, regional and national brokers, and wholesalers and managing general agencies.
Outside of North America, the Company provides personal, commercial and specialty insurance solutions across the U.K., Ireland, and Europe through the RSA brands.
The purpose of PIC is to pay the pensions of its current and future policyholders. PIC provides secure retirement incomes through comprehensive risk management and excellence in asset and liability management, as well as exceptional customer service. At 30 June 2022, PIC had insured 293,400 pension scheme members and had £44.1 billion in financial investments, accumulated through the provision of tailored pension insurance buyouts and buy-ins to the trustees and sponsors of UK defined benefit pension schemes. To date, PIC has made total pension payments of almost £9 billion to its policyholders. Clients include FTSE 100 companies, multinationals and the public sector. PIC is authorised by the Prudential Regulation Authority and regulated by the Financial Conduct Authority and Prudential Regulation Authority (FRN 454345). For further information please visit www.pensioncorporation.com.
Certain statements made in this press release are forward-looking statements. These statements include, without limitation: statements relating to the anticipated benefits and other impacts of the transaction, the sources of funding for the upfront contribution, and the anticipated effect on OROE, BVPS, NOIPS, debt-to-total capital ratio, IRR and pre-tax annual run-rate synergies. All such forward-looking statements are made pursuant to the 'safe harbour' provisions of applicable Canadian securities laws.
Forward-looking statements are based on estimates and assumptions made by management based on management's experience and perception of historical trends, current conditions and expected future developments, as well as other factors that management believes are appropriate in the circumstances. Many factors could cause the Company's actual results, performance or achievements or future events or developments to differ materially from those expressed or implied by the forward-looking statements. In the case of estimated claims and losses, due to the preliminary nature of the information available to prepare estimates, future estimates and the actual amount and categorization of claims and losses associated with events described above may be materially different from current estimates.
All of the forward-looking statements included in this press release are qualified by these cautionary statements and those made in the "Risk Management" sections of our 2022 Management's Discussion and Analysis (Sections 30-34), in Notes 10 and 13 of our Consolidated Financial Statements for the year ended December 31, 2022 and in our Annual Information Form dated February 7, 2023, all of which are available on our web site at www.intactfc.com or on SEDAR at www.sedar.com. The buy-in transaction is also subject to certain risks including that the benefits of the transaction may fail to materialize as anticipated. This may adversely impact the financial performance of Intact. These factors are not intended to represent a complete list of the factors that could affect the Company. These factors should, however, be considered carefully. Although the forward-looking statements are based upon what management believes to be reasonable assumptions, the Company cannot assure investors that actual results will be consistent with these forward-looking statements. When relying on forward-looking statements to make decisions, investors should ensure the preceding information is carefully considered. Undue reliance should not be placed on forward-looking statements made in this press release. The Company has no intention and undertakes no obligation to update or revise any forward-looking statements, whether as a result of new information, future events or otherwise, except as required by law.
SOURCE Intact Financial Corporation
View original content: http://www.newswire.ca/en/releases/archive/February2023/27/c1417.html
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