Move would get rid of the risk of increased cash funding on £1.9 billion of its pension liabilities
Royal & Sun Alliance (RSA), a British insurer, has insured itself against potential rise in the cost of funding one-third of its staff pensions scheme, bringing an earnings increase from 2010 – reported in Reuters.
RSA expressed that the move would get rid of the risk of increased cash funding on £1.9 billion of its pension liabilities.
According to the company, the insurance deal arranged by investment bank Goldman Sachs, would produce a small profit from 2010, but will have no earnings impact this year.
Andy Haste, CEO of RSA, said: This transaction further de-risks the impact of the UK pension schemes on the group’s results and balance sheet.
RSA is a UK-based quoted insurance group which specialises in writing business, focusing on general insurance in the UK, Scandinavia, Canada, Ireland, Asia, the Middle East and Latin America.