Lloyds Banking Group has acquired Zurich’s UK workplace pensions and savings business, which it said would accelerate the development of its adviser-based offering.
The acquisition added more than £15bn assets under administration and 500,000 customers to the business.
It will see Zurich gain exclusive distribution rights for group life protection to certain corporate clients of Lloyds’ commercial banking services.
Lloyds said it planned to boost subsidiary Scottish Widows’ workplace savings platform. The firm manages more than £124bn of funds, of which £35bn is workplace pensions business.
It also intends to provide a flexible investment capability to support advisers to create bespoke client investments and access assets not previously available via Scottish Widows.
As part of the transaction some 200 Zurich employees – including key management, relationship managers, technical experts and operations staff, located primarily in Cheltenham – are expected to transfer to Lloyds.
The acquisition is expected to partially close in the first quarter of 2018, with subsequent completion and transfer of assets following the required regulatory and legal approvals.
Wealth management push
In August, it was reported Lloyds was targeting a “big push” into the wealth management market to capitalise on pension freedom reforms, as part of a three-year growth plan.
On twitter, Platforum head Heather Hopkins said the acquisition had made Lloyds the third largest workplace provider after L&G and Aviva, according to its own data:
Lloyds acquires Zurich’s workplace business. Makes them 3rd largest workplace provider after L&G and Aviva according to @theplatforum data
— heatherahopkins (@heatherahopkins) October 12, 2017
Lloyds director and Scottish Widows insurance and wealth chief executive Antonio Lorenzo said: “Today’s announcement is a clear signal of our commitment to the financial planning and retirement segment.
“The acquisition of Zurich Corporate Savings complements Scottish Widows’ growth to date and provides us with an ideal opportunity to accelerate our goal to become a market leader in this important sector for advisers and customers.
“The greater proposition choice created through this acquisition will help us meet adviser and customer demands and ensure we continue to evolve our service proposition so that we are easy to do business with.”
Zurich UK chief executive Tulsi Naidu added: “We see today’s announcement as a very positive step forward for our business. We are simplifying our organisation and focusing on markets where we have strong assets and can best serve our customers and distributors.
“Our UK life and savings strategy is simple – to establish market leading positions in retail wealth, and retail and corporate protection, while growing our new corporate longevity and de-risking business.”
She added: “This new exclusive deal with Lloyds broadens our corporate protection distribution footprint. To support our other ambitious growth plans, we are also investing in a new multi-million pound retail protection platform and enhancing the range of products on our retail wealth platform.”
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