Government buys IL&P life division for €1.3bn

The life and pensions division of bailed-out finance house Irish Life & Permanent (IL&P) has been bought by the Government for €1.3bn.

The deal — expected for several months — completes Ireland’s bank recapitalisation programme after a plan to sell to a rival did not materialise.

The sale has no impact on bank customers or life policyholders or on their accounts and policies.

Group chairman Alan Cook said the deal was necessary to complete plans to refinance the banking division while also safeguarding Irish Life.

“The financial crisis has exacted an enormous toll on our shareholders, our customers, the taxpayer and the wider community and I know that everyone involved with our group deeply regrets how events have unfolded,” he said.

“As chairman, I want to put on record our gratitude to the Irish Government and the Irish taxpayer for the support they have provided to the bank. “Our focus now must be on minimising any further call on the Irish taxpayer and maximising the potential to build sustainable, customer-focused businesses which in time can repay the taxpayer for the support we have been given.”

IL&P said the deal was finalised under emergency banking legislation and ordered by the High Court to be completed before the end of June. The move will separate life and pension business from banking business while taking the recapitalisation to €4bn, under the Central Bank rules. After that, Irish Life will be wholly owned by the minister for finance, with the aim of selling the business when conditions are right.

The Irish Life business is made up of Irish Life Assurance, Irish Life Investment Managers Limited and related businesses and a 30% minority interest in Allianz Ireland.

Irish Life’s gross assets last June were €30.3bn and operating profit for the six months to the end of that month was about €41m.


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