Handelsbank buys SPP
Sweden’s Handelsbanken has bought the life and insurance business of competing mutual insurance company SPP in a deal worth SEK7.1bn – a move which sees it overtake rivals to become the largest commercial bank in the country’s occupational pensions sector.
The group will now manage approximately 35% of new occupational pensions premiums – 25% in private pensions and 16% in the capital insurance area, a figure to a large degree composed of the move by around 610,000 white collar workers into the Handelsbanken fold - a legacy of SPP’s pensions monopoly in the sector which ended in the early 1990’s.
As a result the volume of assets managed by Handelsbanken will leap to SEK250bn from their current level of SEK90.
The deal also brings Handelsbanken’s portion of the fledgling PPM market up to 17% - making it the second largest player today.
Explaining the buy, Handelsbanken says it sees great cross-selling potential for bank and insurance products. Co-ordination of Handelsbanken Liv and SPP Liv will also bring business synergies to the table, the group says, with SPP Liv turned into a profit-distributing company as is the case with Handelsbanken Liv, which will convert by January 1, 2002.
SPP was moved to sell its life and insurance operations after coming under heavy flak from the Swedish agency for fair trade, criticising its role both as a market monopoly and free agent.
The acquisition will not lead to any redundancies, according to Handelsbanken, and co-operation with Sweden’s white-collar employee organisations will be maintained as before.