US Life Offshore Business Clo
Ref 13/09
18 March 2009
US LIFE OFFSHORE BUSINESS CLOSING TO NEW BUSINESS
Old Mutual plc ('Old Mutual' or the 'Group') announces that its US Life offshore business, Old Mutual Bermuda ('OMB') is being closed to new business with immediate effect. As the Group reported at its preliminary results on 4 March, the OMB management team has been focused on rebuilding the business by writing specialist investment products which would meet its customers' needs as long as this could be done within the Group's agreed risk appetite. Management has now concluded that it is unlikely OMB will be able to launch products that meet these risk requirements successfully and provide a satisfactory return on capital.
Furthermore, closing to new business is expected to facilitate further de-risking and reduce costs by running OMB under a more streamlined team. Old Mutual has therefore decided to close OMB to all new business applications (unless contractually bound to accept them).
OMB remains firmly committed to all existing policy obligations. Hedging effectiveness has continued to improve from the 92% in the fourth quarter of 2008, as reported on 4 March, to more than 94% for the period 1 January to 8 March 2009. The business remains well capitalised with a significant amount of excess capital over and above its regulatory requirement.
Julian Roberts, Old Mutual Group Chief Executive, said:
'One of our key priorities is strengthening governance and risk management and we have taken the decision to close OMB to new business with this in mind. We have improved controls across the Group and each business has been allocated clear risk appetites within which it must trade. The action in connection with OMB will provide greater certainty in respect of the business's future liabilities and will therefore strengthen the Group as a whole.'
For further information on Old Mutual plc, please visit the corporate website at www.oldmutual.com
Enquiries
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Investor Relations |
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Aleida White |
UK |
+44 (0)20 7002 7287 |
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Deward Serfontein |
SA |
+27 (0)82 810 5672 |
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Media |
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Matthew Gregorowski |
UK / SA |
+44 (0)20 7002 7133 |
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Brian Cattell (Finsbury) |
UK |
+44 (0)20 7251 3801 |
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Notes to Editors
Old Mutual
Old Mutual plc is an international savings and wealth management company based in the UK. Originating in South Africa in 1845, the group has a portfolio of businesses offering life assurance, asset management, banking and general insurance services in over 40 countries in Europe, the Americas, Africa and Asia. Old Mutual plc is listed on the London Stock Exchange and the JSE, among others.
In the year ended 31 December 2008, the group reported adjusted operating profit of £1.0 billion (on an IFRS basis) and had £265 billion of funds under management at the year end. The Company has approximately 57,000 employees.
This information is provided by RNS
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