Friends Life plans to return to the asset management sector in the second half of next year with the launch of Friends Life Investments.
It will seed the new asset management arm, to be run by chief investment officer Mark Versey, with £8bn of recaptured assets, focusing initially on fixed income. The business will use an outsourced model with the investment operations to be managed by a third-party administrator.
Friends Life chief executive Andy Briggs says: “The launch of Friends Life Investments marks a significant development for our business. The intention is for this new company to build on existing expertise across our business and is further evidence of our strategic focus in the UK.”
He says the asset management subsidiary will initially focus on fixed income assets “in respect of annuity liabilities, shareholder assets and assets backing other non-profit liabilities”.
He says further investment classes will be considered as the business grows.
The existing Friends Life asset and liability manage- ment team will continue to have oversight and control over non-unit-linked asset management suppliers. This will inc- lude governance of suppliers, investment policy, strategic asset allocation and management of exposure to financial risk from the asset portfolio.
Technology and Technical founder and director Kim North says: “Fixed income is a crowded area at the moment and Friends will need to bring on some big-name managers to complete with the other established players.”