Swiss Re to acquire Barclays Life Assurance Company Ltd for GBP 753 million

Swiss Re will acquire approximately 760 000 life insurance and pension policies and annuity contracts, representing approximately GBP 6.8 billion in invested assets. The Barclays Life book comprises unit-linked life and pension policies with a smaller block of protection business, including term life and permanent health insurance. Admin Re® is a service provided by Swiss Re involving the acquisition of closed books of life and health policies that have been placed into run-off – with Swiss Re assuming responsibility for policy administration.

Barclays Life has been closed to new business since 2001, but the closed business still generates annual premium income of approximately GBP 350 million from contributions to existing policies. The transaction is accretive to economic and US GAAP earnings and is expected to achieve an ROE in excess of Swiss Re’s over-the-cycle target of 14%. The deal will be financed by internal resources and external funding already in place. This transaction has no effect on Swiss Re’s previously announced share buy-back programme – the buy-back of CHF 7.75 billion of shares is expected to be completed as scheduled by April 2010.

Jacques Aigrain, Swiss Re’s Chief Executive Officer, said: “Swiss Re’s execution capability and capital strength, combined with our experience in managing UK life portfolios, have enabled us to acquire Barclays Life at a value-creating price. This acquisition underlines Swiss Re’s role as a leading player in the origination, transfer and trading of insurable risks.”

Completion is anticipated before 31 October 2008 subject to regulatory approvals. 23 people dedicated to Barclays Life will transfer to Swiss Re at completion.

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