UK – Bulk annuity buy-ins could exceed £5bn (€6.1bn) in 2013, Towers Watson has predicted, as the Pension Insurance Corporation (PIC) completed a £40m buy-in for the UK Chamber of Shipping.
Discussing the number of pension funds that were prepared to complete a transaction – from both a data and an asset perspective – senior consultant Ben Stone said he expected a number of funds that had not "crossed the line" by year-end to finalise deals within the first quarter.
"More generally," he added, "pension schemes that have tested the market in the last year are now much better placed to enter into transactions when the time arises, and many schemes have good monitoring tools in place to quickly highlight market opportunities relative to their own assets.
"We should see a steadier stream of completed deals throughout the year now that schemes are more comfortable in setting objectives and making key decisions in a low interest-rate environment."
His comments came the same day PIC announced a £40m deal to insure parts of the Chamber of Shipping Retirement Benefits Plan's liabilities.
The transaction, covering all of the fund's current pensioners, was brokered with the help of Wraggle & Co, as well as consultancy LCP.
Les Stracey, chairman of the trustee at the Chamber of Shipping fund, said he was very pleased to have further secured member benefits.
"As part of an ongoing de-risking process for the plan, under which we had invested in low-risk matching assets, we have been able to take advantage of current market conditions and exchange these assets for a buy-in contract," he said.
The end of the year saw a number of de-risking transactions complete, including a £680m buy-in by the Merchant Navy Officer Pension Fund.
Additionally, the fund for UK insurer LV= completed a £800m longevity insurance deal with Swiss Re, while food manufacturer Tate & Lyle agreed a £350m buy-in with Legal & General.