The Barclays Bank UK Retirement Fund (UKRF) has completed a £5bn (€5.5bn) longevity swap transaction with Reinsurance Group of America (RGA).

The scheme was advised by Aon while Insight Investment was appointed as collateral manager for the transaction.

A multi-disciplinary team at Aon, led by senior partner Martin Bird, advised on all aspects of transaction, including risk analytics, design and structuring, reinsurance selection and operational establishment, the firm said.

It added that Aon’s team included members of the consultancy’s UK-based risk settlement group and Aon’s insurance team.

Bird said: “We worked closely with the trustee of the UKRF in tailoring an insurance structure solution to hedge the fund’s specific longevity risk profile following a competitive reinsurance selection process.”

Tom Scott, principal consultant in Aon’s risk settlement team, added: “This transaction, along with others in the pipeline, demonstrates the capacity and appetite of the global reinsurance market to take on pension fund longevity risk, even in these challenging times. Despite the current economic climate, pension schemes can still successfully access the reinsurance market in an effective manner.”

At Insight, Serkan Bektas, head of client solutions group, noted the transaction was particularly timely given that longevity risk was receiving increased focus among pension schemes.

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