Phoenix Group completed four bulk purchase annuity (BPA) transactions during H2 2021, covering £4bn of premiums, and is now expecting to deliver in excess of £1bn of total new business long-term cash generations for 2021.

According to the group, this is expected to "more than offset" the run-off of the in-force or heritage business, which is currently at around £0.8bn of annual cash generation.

The H2 BPA activity included around £3.6bn worth of external deals and a £0.4bn tranche of the group’s Pearl Pension Scheme, and brings the total bulk purchase annuity premiums for the year to £5.5bn in 2021, more than double the £2.5bn seen in 2020.

The capital strain for all BPA transactions written in 2021 is currently expected to be 6.5 per cent, while the cash multiple is around 2.6x, with the second half transaction economics reflective of the current low credit spread environment.

The performance has been highlighted by the group as demonstration of its efforts to drive organic growth, and as reflection of the investment made into its open business and internal asset management functions.

Commenting on the results, Phoenix Group CEO, Andy Briggs, said: “I am delighted with the progress we are making in building a market-leading bulk purchase annuity business which contracted £5.5bn of premiums in 2021, more than double our 2020 premiums.

"As a result, we have now delivered on our ambition for our new business cash generation to more than offset the run-off of our heritage business and have 'proven the wedge'.

"This reflects the investment we are making into our growing Open business and the Standard Life brand, which supports us in delivering Phoenix’s purpose of helping people secure a life of possibilities.”

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