Sun Life Financial Inc. announced today that Sun Life Assurance Company of Canada (Sun Life) has entered into an agreement to sell its life reinsurance business to Berkshire Hathaway Life Co. of Nebraska. The transaction is subject to regulatory approval and is expected to close December 31, 2010.
"This transaction reflects Sun Life Financial's strategy to deploy capital to the parts of our business that can best achieve strong, sustainable growth," said Donald Stewart, Chief Executive Officer, noting that the sale follows a review of options for the company's reinsurance business. "Our reinsurance business is profitable, but it is not a growth area for Sun Life Financial and this transaction releases capital which can be put to work in other businesses."
The transaction is expected to increase Sun Life's Minimum Continuing Capital and Surplus Requirement (MCCSR) ratio, by 10 to 14 percentage points.
Sun Life's MCCSR ratio was 210% as of June 30, 2010.
Sun Life's reinsurance business has approximately 70 employees in offices in Canada, the U.S. and Ireland. The unit assumes risks from life reinsurers and has life insurance in-force of CDN$113 billion.
"There was significant interest in the marketplace in purchasing our reinsurance business, which speaks to the depth and talent of our reinsurance team,"
Mr. Stewart said. "Sun Life will work closely with Berkshire Hathaway to ensure a smooth transition for clients and employees."
About Sun Life Financial
Sun Life Financial is a leading international financial services organization providing a diverse range of protection and wealth accumulation products and services to individuals and corporate customers. Chartered in 1865, Sun Life Financial and its partners today have operations in key markets worldwide, including Canada, the United States, the United Kingdom, Ireland, Hong Kong, the Philippines, Japan, Indonesia, India, China and Bermuda. As of June 30, 2010, the Sun Life Financial group of companies had total assets under management of CDN$434 billion. For more information please visit www.sunlife.com.
Sun Life Financial Inc. trades on the Toronto (TSX), New York (NYSE) and Philippine (PSE) stock exchanges under the ticker symbol SLF.