Lloyds Bank to sell Abbey Life to Deutsche Bank for £977 million
By Our Banking Bureau | 01 Aug 2007
The UK's fifth largest banking group, Lloyds TSB, has announced its decision to sell its insurance business Abbey Life, a subsidiary of Lloyds' Scottish Widows unit, for £977 million to Deutsche Bank.
Abbey Life, which has been closed to new business since 2000, managed £12 billion of assets held in 1.2 million policies as of 31 December 2006.
Lloyds TSB chief executive Eric Daniels said that following a review, the group had decided that the divestment of Abbey Life was in the "best interest of the group, as well as Abbey Life's policyholders and staff".
Also in the bidding race to acquire Abbey Life, were the UK insurer Pearl, reinsurance giant Swiss Re and Resolution.
While Swiss Re dropped out, Resolution withdrew last week, after announcing its proposed merger with Friends Provident, leaving Pearl and Deutsche to enter a third round of bidding, drawing out an auction that has been going on for several months. Lloyds Bank, one of the oldest banks in the UK, was formed in 1765 in Birmingham. Through a series of mergers Lloyds emerged to become one of the 'big four' banks in the UK.
TSB traces its roots to the first savings bank founded by Henry Duncan in Ruthwell, Dumfriesshire in 1810. In 1985, an Act of Parliament merged all the remaining savings banks in Great Britain under TSB Bank plc.
