Phoenix Group’s SII surplus increases by £0.9bn

Written by Adam Cadle

11/05/2020

Phoenix Group’s Solvency II surplus increased by £0.9bn from £3.1bn as at 31 December 2019 to £4bn as at 24 April 2020, according to latest figures.

The insurance company said the solvency balance sheet “has moved broadly in line with published sensitivities with £(0.2)bn negative economic variances in the period comprised primarily of strains from falls in interest rates and widening of credit spreads partially offset by gains from falls in equities”.

In its trading update, Phoenix Group said it also raised £1.1bn worth of debt in the period to fund the proposed acquisition of ReAssure Group comprising a $750m Restricted Tier 1 Note in January and a £500m Tier 2 Note in April.

A total of 98% of the £20bn shareholder debt portfolio is investment grade and only 15% is BBB. The firm said it has limited exposure to sectors most at risk with only 2% of bond portfolio in airlines, hotel, leisure and traditional retail.

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