The trustees of the Deutsche Bank Defined Benefit (DB) UK Pension Scheme have completed a £500m buy-in with Legal & General Assurance Society, securing the benefits of around 2,000 retirees and deferred members.

The deal, which marks the scheme’s third buy-in but the first to include deferred members, takes the scheme’s total buy-ins to around £1,500m.

It was completed under an existing umbrella contract with Legal & General, allowing the buy-in to be completed "quickly and efficiently" on the same commercial terms.

LCP acted as the lead transaction adviser and provided strategic longevity de-risking advice to the trustee of the scheme, while transaction legal advice was provided to the trustee by CMS.

Aon, meanwhile, acted as scheme actuary and investment adviser, and Slaughter and May as ongoing legal adviser. DLA Piper UK LLP provided legal advice to Legal & General.

Commenting on the deal, Trustee Board chair, Michael Wrobel, said: “We are very pleased to have insured another significant proportion of the scheme’s liabilities with Legal & General, further reducing the risks the scheme is exposed to.

“The existing relationship with Legal & General, including the umbrella contract in place, resulted in a smooth and efficient process benefiting all parties and ultimately the members of the scheme.

"The trustee and the bank remain ready to continue to take advantage of future opportunities to further de-risk as they arise.”

Adding to this, Deutsche Bank AG head of global pension and benefits, Jeremy Sowden, said: “This latest transaction means that approximately half of the total liabilities of the scheme have now been insured, covering not just all pensions in payment but also a significant proportion of pensions that are yet to do so.

"We will continue to work with the trustee to extend the buy-ins as further opportunities arise. The existing relationship with Legal & General allowed us to move quickly to lock in attractive pricing and is an excellent result for all parties.”

Legal & General Retirement Institutional new business and origination lead, Aysha Patel, also highlighted the transaction as demonstration that "partial buy-ins continue to be an effective de-risking tool for larger schemes on their way to full insurance, allowing them to take advantage of favourable market opportunities when they arise".

This was echoed by LCP partner, David Fink, who said that the phased buy-in strategy has proven "very successful for the scheme".

“Careful thought went into the transaction structure to permit a proportion of deferred liabilities to be included," he continued.

"The phased buy-in strategy has been very successful for the scheme and we were able to leverage its existing relationships and the work completed for previous transactions to secure highly attractive pricing in what is proving to be a very busy market in 2023 with many schemes competing for insurer attention.”

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