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SJP is offloading mortgage-only ARs

American giant General Electric has failed to make a significant return on its investment in GE Life after the 465m sale of the retirement specialist to Swiss Re, it is claimed.

GE spent 413m alone on the two acquisitions that constituted the majority of GE Life – 370m for National Mutual in 2002 and 43m for Stalwart in 1997 – before setting aside a further 200m for investment in National Mutual to develop the business.

One analyst, who wishes to remain unnamed, has questioned whether Swiss Re paid too much for GE Life on this basis.

Swiss Re, which has not ruled out a redundancy package as part of the deal, has no plans to add to or ditch any of GE Life’s product lines, which include annuities, equity-release and pensions.

It insists it is business as usual for IFAs at present and will announce a new brand name in early 2007.

The sale has been welcomed by brokers because they believe the might of reinsurer Swiss Re will help provide a higher level of service, as some have complained that GE Life has not been up to scratch.

Norwest Consultants principal Harry Katz says: “I am delighted by the news as the service has often been slow compared to other providers. GE will say it made money from GE Life but I am not so sure.”

Swiss Re spokesman Tim Dickenson says: “We have no plans to make any changes to the range of products mark-eted and sold by GE Life. It is business as usual from now and into the future.”

GE Life spokeswoman Kir-sty MacPherson says: “Service has always been a priority for us.”

St. James’s Place is offloading its mortgage-only appointed representatives, with Home of Choice poised to take them on.

A total of 99 ARs have been told they will have to leave SJP, with HoC being given first refusal although they will be free to choose any network.

SJP chief executive Mark Lund confirms that it is not closing to mortgage business and will take on IFAs that offer mortgages as part of a wider package but he admits that SJP will no longer run with pure mortgage brokers.

If all 99 ARs went to HoC, that would take the network’s total to almost 400 once pipeline business has gone through.

HoC has also received a cash boost after Friends Provident took a minority stake although it has no voting rights and Friends says the investment is a continuation of its policy of buying minority stakes in various distributors, which also includes Intrinsic, Thinc Destini and Tenet. Last month, Friends closed its mortgage network Friends Orion.

The only other stakeholder in HoC, other than its founder members, is Bank of Scotland.

Home of Choice chief executive Richard Coulson says: “This is a clear endorsement of our strategy.”


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