At a glance
- The venture, Standard Life PRT Solutions, was announced in August with CVC Capital Partners, Prudential Financial, Goldman Sachs and MS&AD Insurance Group.
- For managers pitching UK insurer mandates, the split of Standard Life's balance sheet matters more than the headline commitment.
- Cecile Retaureau, head of private markets and alternatives at Standard Life, told Alternative Credit Investor in a Nov. 11 interview that the deal flow the partners bring is a major benefit alongside the capital.
Standard Life's £2 billion pension risk transfer venture with four private markets firms is meant to widen the private debt origination the insurer can draw on, its head of private markets said.
The venture, Standard Life PRT Solutions, was announced in August with CVC Capital Partners, Prudential Financial, Goldman Sachs and MS&AD Insurance Group. Standard Life contributes £500 million and retains full operational control, and the commitments are drawn over five years.
For managers pitching UK insurer mandates, the split of Standard Life's balance sheet matters more than the headline commitment. Its shareholder side holds £42 billion of annuity-backing assets that the insurer largely originates and invests in directly, in assets eligible for the matching adjustment behind bulk purchase and individual annuity liabilities. Its £275 billion defined contribution and savings book is where third-party managers win allocations, as a traditional investor rather than a strategic partner.
Cecile Retaureau, head of private markets and alternatives at Standard Life, told Alternative Credit Investor in a Nov. 11 interview that the deal flow the partners bring is a major benefit alongside the capital. "The partnership announced £2bn of capital but also access to [the partners'] private debt origination," she said. Better assets, in her account, mean sharper pricing on bulk purchase annuity quotes.
The backdrop she described is a bulk annuity market that has been "extremely competitive". Standard Life has run what she calls a hybrid investment model, mixing in-house origination with strategic partners, and is looking to widen the funnel of matching-adjustment-eligible private debt instruments held against pension risk transfer liabilities. The outlet reported the deal as the latest in a wave of insurer tie-ups with alternative managers, citing Apollo's minority stake in Athora.
For the four firms, the draw is a route into an annuity book of £42 billion that Standard Life otherwise largely sources itself, with the capital commitments drawn over five years.
The partnership announced £2bn of capital but also access to [the partners'] private debt originationCecile Retaureau, head of private markets and alternatives at Standard Life
Reported by the Who's investing desk from Alternative Credit Investor. Published . Corrections