Lloyds says the deal is a signal of its commitment to the financial planning and retirement sector
Lloyds Banking Group is to buy Zurich’s UK workplace pensions and savings business in a deal that is expected to partially complete in the first quarter of next year.
The Zurich business has more than £15bn assets under administration and around 500,000 customers.
Scottish Widows already manages more than £124bn of funds of which £35bn is workplace pensions business.
According to data from Platforum, combined, Scottish Widows and Zurich would be the third largest workplace savings provider in the UK.
Data published in Platforum’s February Workplace Savings Guide show that based on third quarter 2016 assets under advice figures, Scottish Widows and Zurich would have a combined £47.7bn AUA compared to Legal & General at £56.9bn and Aviva at £55bn.
The deal will see Zurich get exclusive distribution rights for group life protection to certain corporate clients of LBG’s commercial banking business.
Zurich’s key selling point used to be this idea of seamless transition from its workplace platform to the adviser platform. Now that’s gone!
— Abraham Okusanya (@AbrahamOnMoney) October 12, 2017
Zurich Corporate Savings will broaden Scottish Widows’ offering in the large pension scheme sector with master trust and group self-invested personal pension solutions.
Around 200 Zurich staff will move to Lloyds as part of the deal.
Lloyds says the acquisition “accelerates the development” of its financial planning and retirement business.
Lloyds Banking Group director and Scottish Widows insurance and wealth chief executive Antonio Lorenzo says: “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.”
Lorenzo adds: “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 says: “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.”
Naidu adds: “This new exclusive deal with Lloyds Banking Group 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.”