Sustains expansion of pension risk transfer business

NEWARK, N.J.--(BUSINESS WIRE)-- Prudential Retirement announced today the successful completion of its largest longevity reinsurance transaction to date. Under the terms of the transaction, Prudential Retirement will provide reinsurance of longevity risk to Rothesay Life and to its sister company, Paternoster, both wholly-owned subsidiaries of The Goldman Sachs Group, Inc. The transaction, initially covers pension liability values of GBP 450 million, approximately equal to $723 million U.S. dollars. Prudential Retirement is a business unit of Prudential Financial, Inc. (NYSE: PRU).

“We are pleased to complete another transaction with Rothesay Life, a market leader in the United Kingdom and provide reinsurance for its acquisition of Paternoster,” said Phil Waldeck, senior vice president and head of Prudential’s Pension & Structured Solutions business. “This new transaction is particularly significant in that it covers retired pension plan participants as well as younger beneficiaries who have yet to retire. It further demonstrates Prudential’s capacity and experience to help effectively de-risk pension plans and manage the impact of market turmoil and pension longevity risk.”

Pension plan sponsors, around the world, are concerned with larger than expected funding contributions, falling interest rates, increasing life expectancy trends, and accounting and regulatory changes. As a result, plan sponsors are exploring available options to transfer pension risk and protect their balance sheets.

“The global demand for pension risk transfer techniques and innovations will increase as pension plan sponsors look to manage their exposure to risk,” said Amy Kessler, senior vice president and head of Prudential’s Longevity Reinsurance business. “Prudential is well positioned to handle risk and provide the certainty that plan sponsors look for to achieve their risk reduction goals and keep their retirement promises to plan participants around the world.”

“Rothesay Life is pleased to partner with Prudential once again,” said Addy Loudiadis, chief executive officer, Rothesay Life. “This new transaction underscores Prudential’s strength in providing pension risk transfer solutions.”

Reinsurance contracts are issued by Prudential Retirement Insurance and Annuity Company (PRIAC), Hartford, CT 06103. PRIAC is not a U.K. Financial Services Authority (FSA) authorized insurer and does not conduct business in the United Kingdom or provide direct insurance to any individual or entity therein. Prudential Financial, Inc. of the United States is not affiliated with Prudential plc, which is headquartered in the United Kingdom.

Rothesay Life is an insurance company established in the U.K. as a wholly-owned subsidiary of The Goldman Sachs Group, Inc., a bank holding company and leading global investment banking, securities and investment management firm. Rothesay Life provides annuity and other longevity products to corporate defined benefit pension plans, tailored to meet the specific needs of corporate sponsors, trustees and pension plan members. Rothesay Life is authorized and regulated by the U.K.’s Financial Services Authority.

Prudential Financial, Inc. (NYSE: PRU), a financial services leader with approximately $871 billion of assets under management as of September 30, 2011, has operations in the United States, Asia, Europe, and Latin America. Prudential’s diverse and talented employees are committed to helping individual and institutional customers grow and protect their wealth through a variety of products and services, including life insurance, annuities, retirement-related services, mutual funds, investment management, and real estate services. In the U.S., Prudential’s iconic Rock symbol has stood for strength, stability, expertise and innovation for more than a century. For more information, please visit http://www.news.prudential.com/.

Prudential Retirement delivers retirement plan solutions for public, private, and non-profit organizations. Services include state-of-the-art record keeping, administrative services, investment management, comprehensive employee investment education and communications, and trustee services. With over 85 years of retirement experience, Prudential Retirement helps meet the needs of over 3.6 million participants and annuitants. Prudential Retirement has $214.7 billion in retirement account values as of September 30, 2011.

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CONTACT:

Prudential
Dawn Kelly, 973-802-7134
201-406-7248 mobile
dawn.kelly@prudential.com
or
Josh Stoffregen, 973-802-3996
973-204-2450 mobile
josh.stoffregen@prudential.com

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