Scottish Widows buys Zurich pensions and savings business

Edinburgh-based Scottish Widows has bought the Zurich UK pensions and savings division.

The deal, which has long been the subject of speculation in the industry, adds £15 billion of assets under management to the £124 billion already under management from the Edinburgh office.

It also adds 500,000 customers.

The acquisition was announced yesterday by Scottish Widows’ parent company Lloyds Banking Group, which said the deal “accelerates the development of its financial planning and retirement business”.

Insurance giant Zurich will receive exclusive distribution rights to provide life protection to certain corporate clients of Lloyds’ commercial banking arm as part of the tie-up.

In addition, 200 Zurich employees in Cheltenham are expected to transfer to Lloyds.

Antonio Lorenzo, chief executive at Scottish Widows, said: “Today’s announcement is a clear signal of Lloyds Banking Group’s commitment to the financial planning and retirement segment.

“The acquisition of Zurich Corporate Savings complements Scottish Widows’ growth to date and provides us with an ideal opportunity to accelerate our goal to become a market leader in this important sector for advisers and customers.”

Of Scottish Widows existing £124 billion of funds under management, £35 billion is in the workplace pensions business.

Earlier this year, Lloyds finally returned to private hands nearly nine years after the government bailed it out at the height of the financial crisis.