|Company :||AGEAS||Compartment :||Other|
|ISIN :||BE0003801181||Wire :||Thomson Reuters ONE|
|Document type :||Permanent Information Releases / General Company News|
|Publication date :||8/6/2012 7:16:00 AM|
Ageas will improve the diversification of its investment portfolio by investing in corporate loans
Ageas will further diversify its investment portfolio by allocating up to 5% of the total invested assets to corporate loans, i.e. EUR 3 billion for a total amount of invested assets of roughly EUR 64 billion at the end of June 2012.
Ageas believes corporate loans offer an interesting alternative investment opportunity in the current low-interest environment with the benefit of greater portfolio diversification and attractive risk-return profile.
The main part of this investment will be realised through a partnership on Infrastructure loans with Natixis, a leading French financial institution with a well-established and proven track record in this segment. More specifically Ageas will benefit from:
- an attractive risk adjusted return: infrastructure loans provide yield enhancement and diversification benefits relative to sovereign debt (an important part of Ageas' investment portfolio);
- a collateral based on pledges linked to underlying projects (e.g. buildings, motorways.);
- an improved duration match: infrastructure loans have, by the nature of the projects they finance, long maturities, creating opportunities for the funding of long term liabilities traditionally associated with the insurers.
The agreement with Natixis has the following main characteristics:
- Natixis will be in charge of originating the loans and will retain a pre-agreed substantial percentage of each deal; Ageas will assume the remaining part;
- only new or very recently closed deals in selected sectors and countries will be eligible within the partnership;
- the scope of the partnership excludes Benelux where Ageas has direct access to infrastructure projects;
- the target amount of this loan portfolio is EUR 2 billion for Ageas;
- a period of 2 to 3 years is foreseen to reach the targeted investment amount;
- Natixis will ensure the administration of all loans in this portfolio.
The loans will be classified under the balance sheet line 'Loans' and measured at amortised cost. Accordingly, they are only subject to impairment in case of a credit event.
The remaining EUR 1 billion allocation will be primarily invested in infrastructure located in the Benelux and in real estate via AG Real Estate.
Ageas is an international insurance company with a heritage spanning more than 180 years. Ranked among the top 20 insurance companies in Europe, Ageas has chosen to concentrate its business activities in Europe and Asia, which together make up the largest share of the global insurance market. These are grouped around four segments: Belgium, United Kingdom, Continental Europe and Asia and served through a combination of wholly owned subsidiaries and partnerships with strong financial institutions and key distributors around the world. Ageas operates successful partnerships in Belgium, UK, Luxembourg, Italy, Portugal, Turkey, China, Malaysia, India and Thailand and has subsidiaries in France, Hong Kong and UK. It is the market leader in Belgium for individual life and employee benefits, as well as a leading non-life player, through AG Insurance, and in the UK, it has a strong presence as the fourth largest player in private car insurance and the over 50's market. It employs more than 13,000 people and has annual inflows of more than EUR 17 billion.
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Source: Ageas via Thomson Reuters ONE