{"id":12558,"date":"2016-09-28T11:05:01","date_gmt":"2016-09-28T11:05:01","guid":{"rendered":"http:\/\/www.biphoo.com\/bipnews\/?p=12558"},"modified":"2016-09-28T11:09:49","modified_gmt":"2016-09-28T11:09:49","slug":"deutsche-bank-sells-abbey-life-unit-to-phoenix-for-1-2-billion","status":"publish","type":"post","link":"https:\/\/www.biphoo.com\/bipnews\/business\/deutsche-bank-sells-abbey-life-unit-to-phoenix-for-1-2-billion.html","title":{"rendered":"Deutsche Bank Sells Abbey Life Unit to Phoenix for $1.2 Billion"},"content":{"rendered":"

Deutsche Bank Sells Abbey Life Unit to Phoenix for $1.2 Billion<\/span><\/strong><\/h2>\n

Deutsche Bank Sells Abbey Life Unit to Phoenix for $1.2 Billion<\/strong> : Deutsche Bank on Wednesday said it had sold its Abbey Life insurance unit to Phoenix Group Holdings for \u00a3935 million ($1.22 billion) in a deal that will boost the German lender\u2019s capital position.<\/span><\/p>\n

Shares in the bank rose about 3% in early trading in Frankfurt, following sharp declines earlier this week amid intensifying concerns about its financial health.<\/span><\/p>\n

Deutsche Bank Chief Executive John Cryan said in a statement that the sale would allow the bank\u2019s asset-management arm to focus on its core business and strengthen its capital position.<\/span><\/p>\n

The sale, while relatively small, is good news for the bank at a time of renewed investor concerns about its thin capital cushion ahead of a potential multibillion-dollar settlement with U.S. authorities over mortgage-securities probes. The looming charge has sparked concerns that the bank may need to raise fresh funds, and questions about whether Berlin might be forced to support the lender.<\/span><\/p>\n

Deutsche Bank has dismissed such concerns in recent days, and Mr. Cryan ruled out the need for a capital increase or government assistance in a local media interview published Wednesday.<\/span><\/p>\n

Germany\u2019s finance ministry also denied Wednesday a media report saying the government and regulators are preparing a rescue plan for the bank.<\/span><\/p>\n

Deutsche Bank said the Abbey Life sale will add about 0.1 percentage point to its common equity tier 1 capital ratio. However, the transaction\u2014which is subject to regulatory approval\u2014will result in an expected pretax loss of about \u20ac800 million ($897.2 million) because of goodwill impairment.<\/span><\/p>\n

For Phoenix, the deal will add \u00a310 billion of assets under management, 735,000 new policyholders and boost cash flow to support planned dividend increases. The U.K.-listed business will partly fund the deal through a \u00a3735 million rights issue.<\/span><\/p>\n

As part of the transaction, Deutsche has agreed to indemnify Phoenix to cover a potential negative outcome from a U.K. investigation into Abbey Life\u2019s fair treatment of customers and annuity sales practices.<\/span><\/p>\n

\u2014Monica Houston-Waesch contributed to this article.<\/span><\/p>\n

Source :<\/strong> http:\/\/www.wsj.com\/articles\/deutsche-bank-sells-abbey-life-unit-to-phoenix-for-1-2-billion-1475054496<\/span><\/p>\n

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