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Athene Holding Ltd. to acquire Liberty Life Insurance Company
Greenville, South Carolina, October 22, 2010 —
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.
More information is available at www.rbcinsurance.com.
About RBC
Royal Bank of Canada (RY on TSX and NYSE) and its subsidiaries
operate under the master brand name RBC. We are Canada's largest
bank as measured by assets and market capitalization, and
among the largest banks in the world, based on market capitalization.
We are one of North America's leading diversified financial
services companies, and provide personal and commercial banking,
wealth management services, insurance, corporate and investment
banking and transaction processing services on a global basis.
We employ approximately 78,000 full- and part-time employees
who serve close to 18 million personal, business, public sector
and institutional clients through offices in Canada, the U.S.
and 51 other countries. For more information, please visit
rbc.com.
Forward looking statements
CAUTION REGARDING FORWARD-LOOKING STATEMENTS
Certain statements contained in this press release may be
deemed to be forward-looking statements under certain securities
laws, including the "safe harbor" provisions of
the United States Private Securities Litigation Reform Act
of 1995 and any applicable Canadian securities legislation.
These forward-looking statements include, but are not limited
to, statements with respect to the acquisition of Liberty
Life Insurance Company, the U.S. life insurance business of
RBC Insurance, by Athene Holding Ltd., Liberty Life's intention
to reinsure its life and health insurance business to Protective
Life Insurance Company and a portion of its annuities to Athene
Life Re Ltd. and Royal Bank of Canada's expected losses relating
to this transaction. Forward-looking statements are typically
identified by words such as "believe", "expect",
"foresee" "forecast", "anticipate",
"intend", "estimate", "goal",
"plan" and "project" and similar expressions
of future or conditional verbs such as "will", "may",
"should", "could", or "would".
By their very nature, forward-looking
statements require us to make assumptions and are subject
to inherent risks and uncertainties, which give rise to the
possibility that our predictions, forecasts, projections,
expectations or conclusions and other forward-looking information,
including statements about the acquisition of Liberty Life
Insurance Company by Athene Holding Ltd., Liberty Life's intention
to reinsure its life and health insurance business to Protective
Life Insurance Company and a portion of its annuities to Athene
Life Re Ltd. and Royal Bank of Canada's expected losses relating
to this transaction will not be achieved. We caution readers
not to place undue reliance on these statements as a number
of important factors could cause our actual results to differ
materially from the expectations expressed in such forward-looking
statements. These factors include, but are not limited to
the possibility that the proposed transaction does not close
when expected or at all because required regulatory or other
approvals are not received or other conditions to the closing
are not satisfied on a timely basis or at all, that Royal
Bank of Canada, Athene Holding Ltd., Protective Life Insurance
Company or Athene Life Re Ltd. may be required to modify the
terms and conditions of the proposed transaction to achieve
regulatory approval, or that the anticipated benefits of the
transaction are not realized as a result of such things as
the strength of the economy and competitive factors in the
areas where Liberty Life Insurance Company does business;
the impact of changes in the laws and regulations regulating
financial services and enforcement thereof (including banking,
insurance and securities); judicial judgments and legal proceedings;
the ability of Athene Holding Ltd., Protective Life Insurance
Company and Athene Life Re Ltd. to complete the transaction;
reputational risks, and other factors that may affect future
results of RBC including changes in trade policies, timely
development and introduction of new products and services,
changes in tax laws, and technological and regulatory changes.
We caution that the foregoing list of important factors is
not exhaustive. Additional information about these and other
factors can be found in our Q3 2010 Report to Shareholders
and 2009 Annual Report.
Except as required by law, Royal Bank of Canada assumes no
obligation to update the forward-looking statements contained
in this press release.
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Media contacts:
Kerry Gaetano, RBC, 905-816-5583
Gillian McArdle, RBC, 416-974-5506
Analyst contacts:
Josie Merenda, RBC, 416-955-7803
Karen McCarthy, RBC, 416-955-7809
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