ING Group is getting out of the US life reinsurance business. The Netherlands-based ING announced on Monday it would transfer all assets and reinsure the liabilities of the US business through Scottish Re. It will pay Bermuda-based Scottish Re a ceding commission of Euros 450 million ($561 million).
The deal prompts a loss for ING of Euros 500 million after tax, and the group will take a charge of Euros 160 million in the third quarter and Euros 100 million in the fourth quarter. The remaining Euros 240 million will be amortised over the life of the business. “Despite the aforementioned charges, ING remains confident about its results for the full year 2004,” the group said.
Last month, ING agreed to sell its German BHF-Bank to private bank Sal. Oppenheim.
ING expects the deal with Scottish Re will reduce the capital requirements of it US insurance arm by Euros 700 million.