M&S offloads £1.4 billion of its pension liabilities

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Pension

Marks & Spencer has reportedly transferred £1.4 billion in pension liabilities to insurance firms as it looks to reduce the risk on its own balance sheet.

In its biggest deal to date Aviva has taken on £925 million of M&S’s defined benefit pension liabilities, while Phoenix completed its first bulk annuity deal for £470 million.

The department store is understood to have nearly £9 billion in pensions liabilities, and its most recent move was designed to reduce longevity risk for a proportion of the schemes retired members.

Both of the insurers have said they have set up structures which allow them to take on more of M&S’s liabilities in the future.

Chief investment officer of the scheme Simon Lee said: “We are delighted to have secured these insurance policies for a significant portion of the benefits payable to our members.”

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