The longevity swap market has been notably quiet in 2012, as broader economic factors seemed to put a stop to transactions in the space after a relatively busy 2011. Now it seems that things might begin to pick up as it has been reported that Heineken UK, a brewer of beer and cider products, is actively seeking quotes for a longevity swap for one of its pension plans.
The report in Plan Sponsor Europe (which you can read here) says that Heineken UK are in the advance stages of seeking out quotes for a longevity swap from a number of parties. The quotes are expected to be received with price outlines for a longevity swap transaction within the next few weeks.
According to Plan Sponsor, Heineken UK have requested quotes to transfer the longevity risk of an unspecified portion of their £1.5 billion UK Scottish and Newcastle pension plan. A pensions spokesperson from Heineken UK told Plan Sponsor that they are ‘quite far down the line’ in the process of seeking out quotes and expect two or three providers to respond within a month.
It would be good for the longevity swap and longevity risk transfer market to see a transaction being completed soon. There have been a number of large longevity risk transfer transactions this year, but we haven’t covered a major longevity swap transaction since the Aegon – Deutsche Bank deal in February of this year. We’ll update you should we hear anymore on Heineken UK’s plans.