Barclay's Selling Assurance Business

Article published on 12th June 2008

High street bank Barclays is looking for bidder to purchase the life assurance arm of its business, which handles about £7 billion. Market commentators value the Barclays subsidiary as being worth about £1 billion on an embedded value basis.

Originally a combination of Woolwich Life and Barclays Life, the Barclays Life Assurance Company looks after the investments, life insurance and pension interests of tens of thousands of people in the UK. It apparently pays the pension of more than 70,000 people every month.

The main business of this arm of Barclays consists of unit-linked life insurance and pension policies - though it has a growing amount of annuities in payment.

Business is shrinking however, as Barclays views the division since the two original brands merged and so stopped accepting new business under their original designations back in 2001.

Barclays' 'For Sale' notice may attract Pearl Group, the life insurance company that bought out Resolution in a £5 billion deal. Other potential bidders include Swiss Re, Admin Re, General Re, XL Re and Canada Life.

A spokesman for Barclays is reported to have said: "Barclays is currently reviewing options for the Barclays Life business".

"This is an attractive business providing stable, long-term cash flows, but not core to the group's franchise. This review may or may not result in a sale."

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