Phoenix Group completes further buy-in with its own pension scheme

Phoenix Group has completed a further £998m buy-in with the Pearl Pension Scheme.

The principal employer, Pearl Group Holdings No. 2 Limited, a Phoenix Group company, previously agreed to a series of buy-ins with the scheme to cover around £3bn of liabilities

Following this latest deal, 60 per cent of the scheme’s liabilities are now covered, with the remaining 40 per cent to be completed no later than 2023.

Revealed during a presentation on the company’s half-year results, the latest buy-in was completed in July 2021 and Phoenix stated it would deliver £206m of incremental long-term cash generation.

Phoenix Group CEO, Andy Briggs, said the firm was “delighted” to reach an agreement with the trustee and that the transaction had reduced the capital strain on this second tranche from 12 per cent in 2020 to 6 per cent this year.

The timing and size of de-risking deals with future tranches are still to be agreed with the pension trustee.

The previous buy-in, which was effective from 30 September 2020, covered £750m of the scheme’s pensioner and deferred member liabilities.

The agreement on the series of buy-ins replaced the previous 2021 Pensions Agreement, and includes provisions for payments by Pearl Group to the scheme if it does not meet the minimum buy-in completion schedule.

The scheme’s triennial valuation, as at 30 June 2018, showed a surplus of £104m.

It comprises a final salary section, a money purchase section and a hybrid section, and is closed to new members and as no active members.

Phoenix Group has four main pension schemes: Pearl Group Staff Pension Scheme, the PGL Pension Scheme, the Abbey Life Staff Pension Scheme and the ReAssure Staff Pension Scheme. 

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