Buyout deals are projected to hit £10bn in 2010, says Pension Capital Strategies, following healthy market activity in Q2 2010, and deals totalling £2.2bn already written by insurers.

The firm has updated its analysis of pensions buyouts and believes that, despite no new longevity swap deals announced in the second quarter, interest remains from both trustees and sponsoring employers. Pension Capital Strategies said one insurer has quoted a £5.5bn pipeline during the second quarter.

2010 saw Rothesay Life confirm the completion of the largest buy-in deal, with a £1.3bn buy-in of pension liabilities of the British Airways Pension Scheme.

Tiziana Perrella, head of buyout services of Pension Capital Strategies, said: “It’s been a buoyant first half of 2010, with £6.3bn of business transacted including longevity swaps. This is further evidence of sponsors’ keenness to de-risk defined benefit schemes.”

Perrella said they expect the market to remain active throughout 2010, with transactions of around £1.5bn likely for the remaining part of 2010. This, Perrella said, will push total deals for the year to £10bn, or possibly more.

Meanwhile, reports and rumours in the financial media suggest that buyout firm Paternoster is up for sale.

The firm, which was set up in 2006, was forced to withdraw from writing new business during the financial crisis.

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