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Paternoster fund deals hit £300m

Defined-benefit consolidator Paternoster has been selec-ted by pension fund trustees as the annuity provider for schemes totalling £300m in 2006.

At the end of last year, the total value of assets transferred to Paternoster was £123m, which includes assets of the Cuthbert Heath Fam-ily Plan and the Chartered Accountants’ Employees Superannuation Scheme.

Chief executive Mark Wood says: “Since we received FSA authorisation last June, we have seen interest in the transfer of the risk associated with defined-benefit pension plans intensify.

“We have been selected by 15 schemes to date and we are in dialogue with over 100 companies and their trustee boards.”

Wood predicts huge growth in the defined-benefit buyout sector in the years ahead due to the increased risks of growing longevity and changing regulation for companies and trustees of pension schemes.

Paternoster has completed its management team with the appointments of two former Prudential directors – David Still as pricing director and Viswanathan Balamurugan as chief executive officer of its Indian operation.

Still was Pru’s business development director for annuities and Balamurugan was operations and knowledge services (India) director.

Over 40 candidates have accepted deals in Paternoster’s Indian operation and are being trained in London.

Wood says: “The drivers behind the new pension reality are increases in life expectancy, changing corporate accounting disclosure requirements and changes to the regulation of pension schemes, all of which encourage risk reduction. The buyout market is one way for companies and trustees derisk their liabilities.”

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