RCS - Rothesay Life PLC - Rothesay - First Quarter Trading Update

Mondelez InternationalAnnouncement

02/05/2023 15:30

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RNS Number : 1517Y  Rothesay Life PLC  02 May 2023

2(nd) May 2023

First Quarter Trading Update

Substantial capital surplus and proven execution capabilities deliver strong
performance in a buoyant market

 

Rothesay, the UK's largest specialist pensions insurance company, today
provides an update on its trading and financial performance for the first
quarter of 2023.

 

·     New business: Since the start of 2023, Rothesay has completed
de-risking transactions with four pension schemes, resulting in new business
premiums of c.£1.6bn.

 

·      Market outlook: Rothesay is currently in advanced stages on over
c.£10bn of further new business. A buoyant bulk annuity market continues to
create significant new business opportunities, with Rothesay's own new
business pipeline currently over £40bn. The Group continues to maintain its
disciplined approach to underwriting to ensure returns from new business are
appropriate.

 

·      Solvency: Rothesay is pleased to announce that the Prudential
Regulation Authority has approved its application to use a Full Internal Model
(FIM) in relation to Rothesay's Solvency Capital Requirement (SCR). The FIM
will be implemented during the second quarter of 2023. We estimate that the
Group's solvency position as at 31(st) March 2023, pro-forma allowing for the
impact of the FIM as of that date, would have been 243%. Our significant
surplus capital means that Rothesay is well-placed for further future growth
opportunities resulting from the positive conditions in the pension risk
transfer market.

 

·     Market Consistent Embedded Value: As of 31(st) March 2023, the
Market Consistent Embedded Value of the Group was estimated to be c.£6.8bn
(£6.4bn as at 31(st) December 2022).

 

·      Risk management: Rothesay's long-term investment in
market-leading risk management systems combined with its comprehensive
liquidity risk management framework, meant that the Group's solvency and
liquidity position remained very strong throughout the significant turbulence
in the financial markets in 2023. Rothesay has minimal exposure to BBB-rated
bonds and no direct exposure to US regional banks. Rothesay's commercial real
estate lending exposure is primarily through senior debt financing of landmark
property assets with highly-rated tenants and owners, and low Loan to Value
(LTV) ratios. As at 31 December 2022, the average LTV ratio on our commercial
real estate loans was around 50%.

 

·      Credit ratings: Rothesay Life Plc is rated A+ (Strong) for the
Fitch Insurer Financial Strength Rating, and A2 for the Moody's Insurance
Financial Strength Rating. The rating outlook is stable from both.

 

Tom Pearce, Chief Executive Officer of Rothesay, said: "Rothesay's substantial
capital surplus combined with our well proven extensive execution
capabilities, particularly in relation to large and complex transactions, mean
we are very well-positioned in an incredibly buoyant bulk annuity market. We
have executed four transactions already in 2023 and are currently in advanced
negotiations on a further significant volume of additional new business, with
an unprecedented pipeline for the rest of the year and into 2024.

 

As we navigate these exciting growth opportunities we will always maintain our
disciplined approach to underwriting, our focus on operational excellence and
our continued investment in our market leading and purpose-built risk
management systems."

ENDS

Media Contacts

Rothesay: Anthony Marlowe, Head of Communications & Public Affairs

+44 (0)7912 550184 or anthony.marlowe@rothesay.com
(mailto:anthony.marlowe@rothesay.com)

Temple Bar Advisory: Alex Child-Villiers +44 (0)7795 425580, Will Barker +44
(0)7827 960151 or Sam Livingstone +44(0) 7769 655437 or
rothesay@templebaradvisory.com (mailto:rothesay@templebaradvisory.com)

 

Notes to Editors

About Rothesay

Rothesay is the UK's largest pensions insurance specialist, purpose-built to
protect pension schemes and their members' pensions. With over £47 billion of
assets under management, we secure the pensions of more than 825,000 people
and pay out, on average, approximately £200 million in pension payments each
month.

 

Rothesay is dedicated to providing excellence in customer service alongside
prudent underwriting, a conservative investment strategy and the careful
management of risk. We are trusted by the pension schemes of some of the UK's
best known companies to provide pension solutions, including Asda, British
Airways, Cadbury, the Civil Aviation Authority, the Co-operative Bank, William
Hill, National Grid, Morrisons, the Post Office and telent.

 

Rothesay has two substantial institutional shareholders, GIC and Massachusetts
Mutual Life Insurance Company ("MassMutual"), who provide the company with
long-term support for its growth and development.

 

Rothesay refers to Rothesay Limited and its subsidiaries and is the trading
name for Rothesay Life Plc, an insurance company authorised by the Prudential
Regulation Authority and regulated by the Financial Conduct Authority and the
Prudential Regulation Authority. Firm Reference Number: 466067. Rothesay Life
Plc is registered in England and Wales with company registration number:
06127279 and registered address: Rothesay Life Plc, The Post Building, 100
Museum Street, London WC1A 1PB. Further information is available at
www.rothesay.com (http://www.rothesay.com)

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