Marks and Spencer (M&S) has agreed to two further buy-ins, with Pension Insurance Corporation and Phoenix Life, insuring around £1.4bn of liabilities.

The move continues the firm's policy of reducing the risks in its £10bn UK defined benefit pension scheme, following its completion of buy-ins worth £1.4bn with Aviva and Phoenix Life in May 2018.

The four policies purchased have insured around two thirds of the scheme's liabilities.

Commenting on the announcement, M&S Pension Trust chair, Graham Oakley, said: “We’re pleased to announce the purchase of these additional buy-in policies, which provide an important contribution to the trustee’s ongoing objective of reducing the longevity risk in the scheme to increase the security of all members’ pensions.”

M&S hope that the approach to longevity de-risking will reduce the risk that it will have to contribute additional cash to the scheme in future.

Linklaters advised the M&S trustee on the two bulk annuity insurance policies and noted that the the way the contact is structured will allow the trustee to enter into future transactions on the same terms.

M&S's lead advisers were LCP, while Hymans Robertson advised the sponsor.

The Phoenix Life transaction was carried out under the previous umbrella contract entered into in 2018.

Hymans Robertson partner, Richard Wellard, added: “This will undoubtedly be one of many large buy-in transactions to complete this year.

“Setting a strategy and timing transactions in a way that works for both the company and the trustee is very important.

“Shared objectives, a collaborative approach and continual communication are so important in the de-risking of large pension schemes. This a marathon, not a sprint.”

This announcement comes after the firm revealed yesterday (22 May) that the scheme's surplus fell by £33.9m to £914.3m.

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