REG - Phoenix Group Hldgs - Miscellaneous - PGH/TCS Extension of Partnership

Phoenix groupAnnouncement

07/02/2023 15:45

For best results when printing this announcement, please click on link below:
http://newsfile.refinitiv.com/getnewsfile/v1/story?guid=urn:newsml:reuters.com:20230207:nRSG2049Pa&default-theme=true

RNS Number : 2049P  Phoenix Group Holdings PLC  07 February 2023

 

LEI: 2138001P49OLAEU33T68

 

Phoenix Group extends partnership with Tata Consultancy Services (TCS)

Phoenix Group, the UK's largest long-term savings and retirement business,
today announces plans to extend its long-standing partnership with leading
global technology and IT services provider Tata Consultancy Services (TCS).
Phoenix will be moving c.3 million policies from its Alpha platform to the TCS
BaNCS(TM) platform provided by TCS's UK subsidiary Diligenta, a leading
provider of business process services to the life and pensions industry.

As part of its acquisition of ReAssure in 2020, Phoenix took ownership of the
Alpha administration platform, which manages legacy ReAssure products. Since
then, Phoenix has operated the Alpha platform in-house, alongside its
outsourced partnership with TCS.

Over the past three years, Phoenix has deepened its relationship with TCS and
Diligenta - announcing the movement of its Standard Life business to TCS in
2019 and more recently through the proposed acquisition of Sun Life of Canada
UK which already uses the TCS BaNCS(TM) platform.

Consolidating all policies on TCS BaNCS(TM) will allow the business to benefit
from TCS's significant ongoing investment in the platform with Phoenix
customers benefiting from the clear digital focus, consistent customer
journeys and customer proposition provided by one platform.

The Alpha platform will be decommissioned, with all policies moving on a
staggered basis to TCS BaNCS(TM). It is expected this will be complete by
2026. Some back office administrative processes will be moved to TCS's
operational hub in India.  All of the customer call servicing will remain
within TCS's UK operations with the plan to operate the customer contact
centre from the existing Phoenix Telford site using ReAssure operational
teams.

This will eventually lead to the closure of the Phoenix site in Hitchin by
2026.

Phoenix is working with TCS to finalise the detail of changes proposed, and -
at an appropriate time - will enter consultation with impacted employees.
Phoenix will look to ensure that redundancies are kept to a minimum wherever
possible, for example through redeployment opportunities and natural
attrition.

This transformation programme is also fully aligned with Phoenix Group's model
of enhancing long term cost efficiency, with a further c.£0.2 billion of net
cost synergies now expected to be realised from the ReAssure integration.
These synergies comprise annual post-tax cost savings of c.£35 million per
annum, valued at c.£0.4 billion which increases long-term cash generation,
and post-tax integration costs estimated at c.£0.2 billion incurred by the
Group. The estimated impact on the Group's key financials are:

·    c.£0.2 billion increase in Group long-term free cash

·    Broadly neutral impact on Solvency II surplus

Commenting on the announcement, Phoenix Group CEO, Andy Briggs said:

"We continually review our operating model to ensure it is meeting the
evolving needs of our customers on their journey to and through retirement.
Since the acquisition of ReAssure in 2020, Phoenix has been operating two
customer administration platforms concurrently. This gave us optionality in
the short-term, but over the long term, it makes more sense to consolidate
policies onto the TCS BaNCS(TM) platform. It will remove duplicate investment,
fully leverage the advantages of our strategic relationship with TCS and
ensure we maintain cost efficiency. It will enable Phoenix customers to
benefit from the clear digital focus, consistent customer journeys and
customer proposition provided by one platform.

"While this transformation will lead to the transfer of a number of roles from
existing ReAssure sites, we are committed to supporting all those employees
who will be impacted and will do whatever we can to minimise redundancies."

 

Enquiries

Investors/analysts:

Claire Hawkins, Director of Corporate Affairs and Investor Relations, Phoenix
Group

+44 (0)20 4559 3161

Andrew Downey, Investor Relations Director, Phoenix Group

+44 (0)20 4559 3145

Media:

Douglas Campbell, Teneo

+44 (0)7753 136 628

Shellie Wells, Corporate Communications Director, Phoenix Group

+44 (0)20 4559 3031

Legal Disclaimers

This announcement in relation to Phoenix Group Holdings plc and its
subsidiaries (the 'Group') contains, and the Group may make other statements
(verbal or otherwise) containing, forward-looking statements and other
financial and/or statistical data about the Group's current plans, goals,
ambitions and expectations relating to future financial condition,
performance, results, strategy and/or objectives.

Statements containing the words: 'believes', 'intends', 'will', 'may',
'should', 'expects', 'plans', 'aims', 'seeks', 'targets', 'continues' and
'anticipates' or other words of similar meaning are forward looking.  Such
forward-looking statements and other financial and/or statistical data involve
risk and uncertainty because they relate to future events and circumstances
that are beyond the Group's control. For example, certain insurance risk
disclosures are dependent on the Group's choices about assumptions and models,
which by their nature are estimates. As such, actual future gains and losses
could differ materially from those that the Group has estimated.

Other factors which could cause actual results to differ materially from those
estimated by forward-looking statements include, but are not limited to:
domestic and global economic, social, environmental and business conditions;
asset prices; market related risks such as fluctuations in interest rates and
exchange rates, the potential for a sustained low-interest rate environment,
and the performance of financial markets generally; the policies and actions
of governmental and/or regulatory authorities, including, for example,
initiatives related to the financial crisis, the COVID-19 pandemic, climate
change and the effect of the UK's version of the "Solvency II" requirements on
the Group's capital maintenance requirements; the impact of inflation and
deflation; the political, legal, social and economic effects of the COVID-19
pandemic and the UK's exit from the European Union; information technology or
data security breaches (including the Group being subject to cyberattacks);
the development of standards and interpretations including evolving practices
in ESG and climate reporting with regard to the interpretation and application
of accounting; the limitation of climate scenario analysis and the models that
analyse them; lack of transparency and comparability of climate-related
forward-looking methodologies; climate change and a transition to a low-carbon
economy (including the risk that the Group may not achieve its targets);
market competition; changes in assumptions in pricing and reserving for
insurance business (particularly with regard to mortality and morbidity
trends, gender pricing and lapse rates); the timing, impact and other
uncertainties of proposed or future acquisitions, disposals or combinations
within relevant industries; risks associated with arrangements with third
parties; inability of reinsurers to meet obligations or unavailability of
reinsurance coverage; the impact of changes in capital, solvency or accounting
standards, and tax and other legislation and regulations in the jurisdictions
in which members of the Group operate.

As a result, the Group's actual future financial condition, performance and
results may differ materially from the plans, goals, ambitions and
expectations set out in the forward-looking statements and other financial
and/or statistical data within this announcement. The Group undertakes no
obligation to update any of the forward-looking statements or data contained
within this announcement or any other forward-looking statements or data it
may make or publish.  Nothing in this announcement constitutes, nor should it
be construed as, a profit forecast or estimate.

This information is provided by RNS, the news service of the London Stock Exchange. RNS is approved by the Financial Conduct Authority to act as a Primary Information Provider in the United Kingdom. Terms and conditions relating to the use and distribution of this information may apply. For further information, please contact
rns@lseg.com (mailto:rns@lseg.com)
 or visit
www.rns.com (http://www.rns.com/)
.

RNS may use your IP address to confirm compliance with the terms and conditions, to analyse how you engage with the information contained in this communication, and to share such analysis on an anonymised basis with others as part of our commercial services. For further information about how RNS and the London Stock Exchange use the personal data you provide us, please see our
Privacy Policy (https://www.lseg.com/privacy-and-cookie-policy)
.   END  MSCUPUAGPUPWGWM