Oct. 22, 2010 (Canada NewsWire Group) –
GREENVILLE, SC, Oct. 22 /CNW/ – Royal Bank of Canada (RY on TSX and NYSE) today announced that Athene Holding Ltd. has agreed to acquire Liberty Life Insurance Company, the U.S. life insurance business of RBC Insurance for US$628.1 million. The transaction is subject to regulatory approvals and customary closing conditions, and is expected to close in early 2011. RBC expects that the transaction will result in a loss of approximately US$115 million under Canadian generally accepted accounting principles (GAAP) on both a pre and after tax basis.
Immediately following the closing of the acquisition, Liberty Life will reinsure its life and health insurance business to Birmingham, Alabama-based Protective Life Insurance Company and a portion of its annuities to Athene Life Re Ltd., a Bermuda based subsidiary of Athene Holding Ltd.
In its U.S. GAAP reconciliation, RBC expects to show that the transaction will result in a loss of approximately US$405 million on both a pre and after tax basis. The variation between the Canadian and U.S. GAAP loss amounts is largely attributable to accounting differences in the valuation of actuarial liabilities.
The amounts of the Canadian GAAP and U.S. GAAP losses are based on current estimates and are subject to change.
About RBC Insurance
RBC Insurance provides a wide range of life, health, travel, home, auto and reinsurance products as well as creditor insurance services to more than five million clients in Canada, the U.S. and internationally. These products and services are offered through a wide variety of distribution channels, including the telephone, retail insurance branches, independent brokers, travel agents, a proprietary sales force and the Internet.