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Lehman May 7
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PMC Bancorp Fights Lehman's $2M Win At 9th Circ.
May 6, 2015 | Law360
By Brandon Lowrey
PMC Bancorp on Wednesday urged the Ninth Circuit to overturn Lehman Brothers Holdings Inc.'s $2.4 million win in a lawsuit over allegedly defective residential mortgage loans that PMC sold to Lehman, saying that Lehman is precluded from seeking damages on most of the defaulted loans because it made full credit bids on them. -
Technology Paves The Way For Lehman Brothers Pensions Settlement
May 6, 2015 | International Business Times
By Ravender Sembhy
The end of the world's largest corporate insolvency has moved one step closer after administrators to failed banking giant Lehman Brothers brokered a £675m ($1.025bn, €911.5m) pensions deal. PwC, which is handling Lehman's administration in Europe, today said that pension provider Rothesay Life will underwrite the bank's entire pension pot... -
PwC Leads Lehman Brothers Annuity Deal
May 6, 2015 | Economia
By Oliver Griffin
Big Four firm PwC has completed a £675m bulk annuity deal between Rothesay Life and Lehman Brothers pension scheme trustees Subject to an assessment period under the 2004 Pensions Act due to Lehman Brothers’ becoming insolvent in 2008, pension benefits were restricted until July this year. -
Lehman Brothers International Completes Pension Bulk Annuity Deal With Rothesay Life
May 6, 2015 | Pensions & Investments
By Sophie Baker
Lehman Brothers’ European business completed a £675 million ($1 billion) bulk annuity transaction for its U.K. defined benefit plan with Rothesay Life, said Ben Stone, senior partner at PricewaterhouseCoopers and lead adviser on the deal. PwC acted on behalf of Lehman Brothers International (Europe), which is in bankruptcy administration... -
Lehmans Scheme Insured in £675M Deal with Rothesay After TPR Action
May 6, 2015 | Investments & Pensions Europe
By Taha Lokhandwala
Bulk annuity provider Rothesay Life has insured the UK Lehman Brothers Pension Scheme after The Pensions Regulator (TPR) secured funding from subsidiary groups for the abandoned defined benefit (DB) scheme. The £675m (€916m) deal, the largest in 2015, has seen the pension scheme transfer all risks to the insurer, with an end to... -
Lehman Brothers Secures UK Pension with Buy-in
May 6, 2015 | Chief Investment Officer
By Nick Reeve
Rothesay Life has agreed a deal with Lehman Brothers International’s UK pension to insure £675 million ($1 billion) of liabilities in the country’s biggest de-risking transaction this year. The deal follows an agreement struck in August between PricewaterhouseCoopers (PwC)—the administrators of the collapsed bank—and the trustees of the Lehman... -
Lehman Scheme Seals £675m Deal To End Six-Year Saga
May 6, 2015 | Professional Pensions
By Stephanie Baxter
Lehman Brothers Pension Scheme has secured a £675m buyout with Rothesay Life, ensuring that all members will get their pensions in full, six and a half years after its sponsor went bust. The deal – the biggest bulk annuity written this year – comes after the 2,500-member scheme reached a £184m settlement with administrators of the failed... -
Lehman Brothers Agrees £675 Million Pension Buy-In
May 6, 2015 | Employee Benefits
By Marianne Calnan
Financial services firm Lehman Brothers has agreed a £675 million buy-in transaction for its pension scheme with insurance firm Rothesay Life, following its application for bankruptcy in 2008. The buy-in has also secured full employee benefits for all members as a result of the settlement between the pension scheme trustees and the joint...
Client Attorney Privileged/Attorney Work Product/At Request of Counsel
PMC Bancorp
Rothesay Life
Full Text of Stories Below
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PMC Bancorp Fights Lehman's $2M Win At 9th Circ.
May 6, 2015 | Law360
By Brandon Lowrey
PMC Bancorp on Wednesday urged the Ninth Circuit to overturn Lehman Brothers Holdings Inc.'s $2.4 million win in a lawsuit over allegedly defective residential mortgage loans that PMC sold to Lehman, saying that Lehman is precluded from seeking damages on most of the defaulted loans because it made full credit bids on them.
During oral arguments in Pasadena, California, PMC attorney Joseph Arthur Walker of The Walker Law Firm APC contended that Lehman Brothers made full credit bids on six of the 11 loans in dispute, and said that the district court judge erred in finding the full credit bid rule does not apply to the secondary mortgage market. He contended that the application of the rule should limit the damages Lehman Brothers could seek in the case.
Lehman Brothers argued that in separate indemnity agreements for two of the loans, PMC waived its full credit bid defense. Lehman Brothers said that as for the other four loans, it did not own the loans at the time and thus did not and could not have placed full credit bids on the loans.
A full credit bid, according to the California Supreme Court, is a lender's bid at a nonjudicial foreclosure sale "in an amount equal to the unpaid principal and interest of the mortgage debt, together with the costs, fees and other expenses of the foreclosure," according to court documents. If the full credit bid is successful, the lender pays the full outstanding balance of the debt and costs of foreclosure to itself and takes the title to the security property. The borrower is released from further obligations.
Lehman Brothers sued in September 2010, alleging that it discovered a set of loans that PMC sold to Lehman Brothers Bank FSB did not conform to the terms of their deal, and that PMC refused to buy them back, in violation of the purchase agreement. Lehman Brothers claimed that it suffered damages when the borrowers under the 11 loans defaulted.
The suit alleged breach of express warranty and three claims for breach of contract.
In March 2013, U.S. District Judge John A. Kronstadt granted summary judgment in favor of Lehman Brothers, finding that PMC's full credit bid rule argument fell flat. He said in his ruling that the full credit bid rule does not apply in cases in which the lender purchased a loan based on misrepresentations from the party that originated the loan, or had been required to purchase it from an upstream investor, or in the secondary mortgage market, among other instances.
The court awarded Lehman Brothers about $487,000 in attorneys' fees.
During Wednesday's hearing, Lehman Brothers attorney Chip G. Schoneberger of Foster Graham Milstein & Calisher LLP told the Ninth Circuit that Lehman Brothers did not own the loans at the time of foreclosure, and did not foreclose on them...For full story:
http://www.law360.com/articles/652515/pmc-bancorp-fights-lehman-s-2m-win-at-9th-circ-
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Technology Paves The Way For Lehman Brothers Pensions Settlement
May 6, 2015 | International Business Times
By Ravender Sembhy
The end of the world's largest corporate insolvency has moved one step closer after administrators to failed banking giant Lehman Brothers brokered a £675m ($1.025bn, €911.5m) pensions deal.
PwC, which is handling Lehman's administration in Europe, today said that pension provider Rothesay Life will underwrite the bank's entire pension pot, meaning 2,250 staff will have their future pensions paid in full.
Rothesay is co-owned by Goldman Sachs, Blackstone and Singapore's sovereign wealth fund GIC.
Paul Kitson, partner at PwC, hailed the use of technology in getting the deal done.
"The use of technology throughout the process was integral. We used Skyval, PwC's pensions analytics software to obtain accurate insurer pricing and then to track these prices through a period of volatile market conditions.
"This real-time analysis was also the basis for a very successful asset hedging strategy meaning that the deal stayed firmly on track during a period when falls in interest rates impacted buy-out affordability for most UK pension schemes," he said.
Last year a £184m deficit was plugged in the scheme after five companies within the failed bank agreed to a settlement brokered by The Pensions Regulator and trustees. Today's announcement marks the conclusion of that process...
For full story:
http://www.ibtimes.co.uk/technology-paves-way-lehman-brothers-pensions-settlement-1499884
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PwC Leads Lehman Brothers Annuity Deal
May 6, 2015 | Economia
By Oliver Griffin
Big Four firm PwC has completed a £675m bulk annuity deal between Rothesay Life and Lehman Brothers pension scheme trustees
Subject to an assessment period under the 2004 Pensions Act due to Lehman Brothers’ becoming insolvent in 2008, pension benefits were restricted until July this year.
However because of a deal brokered by the Big Four firm, insurance solution specialist Rothesay Life will assume pension liabilities for all defined benefit pension scheme members.
Benefits that were restricted will now be paid in full with Lehman Brother’s International Europe (LBIE) – which is in administration – providing financial support.
Peter Gamester, chairman of trustees of the Lehman Brothers pension scheme, thanked advisers for their role in securing the “extremely successful” result.
“Since the bankruptcy of Lehman Brothers in 2008, the trustees have been striving to secure the pension benefits promised to members of the Scheme,” Gamester said.
“The agreement with Rothesay Life achieves this goal as it enables members’ defined benefit entitlements to be paid in full...
For full story:
http://economia.icaew.com/news/may-2015/pwc-leads-lehman-brothers-annuity-deal
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Lehman Brothers International Completes Pension Bulk Annuity Deal With Rothesay Life
May 6, 2015 | Pensions & Investments
By Sophie Baker
Lehman Brothers’ European business completed a £675 million ($1 billion) bulk annuity transaction for its U.K. defined benefit plan with Rothesay Life, said Ben Stone, senior partner at PricewaterhouseCoopers and lead adviser on the deal.
PwC acted on behalf of Lehman Brothers International (Europe), which is in bankruptcy administration and provided financial support to secure full benefits for participants in the pension fund, reflecting a settlement agreement between the trustees of the pension fund and LBIE’s joint administrators. A £184 million deal to enter into a buyout was announced last August.so this is OK?
The deal is the largest bulk annuity transaction announced so far in 2015 in the U.K. Rothesay Life will assume liability for the full benefits payable to all members of the pension fund.
“(That agreement) kicked off the process of seeing if a buyout was affordable, in terms of paying benefits (to members) in full,” Mr. Stone said in a telephone interview. “We also helped to put in place an asset strategy to hedge vs. movements in the buyout prices that we received. We had a panel of five or six insurers interested. In looking at their prices and understanding how they moved, we could change the scheme assets to reflect that. Therefore, over the pretty turbulent time for the markets (at the end of last year and early this year), that allowed the deal to stay alive and affordable,” Mr. Stone said.
The initial deal is a buy-in transaction, which will convert to a full buyout in due course, said a Rothesay Life news release...
For full story:
http://www.pionline.com/article/20150506/ONLINE/150509933/lehman-brothers-international-completes-pension-bulk-annuity-deal-with-rothesay-life
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Lehmans Scheme Insured in £675M Deal with Rothesay After TPR Action
May 6, 2015 | Investments & Pensions Europe
By Taha Lokhandwala
Bulk annuity provider Rothesay Life has insured the UK Lehman Brothers Pension Scheme after The Pensions Regulator (TPR) secured funding from subsidiary groups for the abandoned defined benefit (DB) scheme.
The £675m (€916m) deal, the largest in 2015, has seen the pension scheme transfer all risks to the insurer, with an end to restricted benefits after legal wrangling between TPR and the US bank’s administrators.
Rothesay is owned by US bank Goldman Sachs, Singaporean sovereign wealth fund GIC, asset manager Blackstone and Massachusetts Mutual Life Insurance.
Peter Gamester, chair of trustees for the scheme, said the deal secured full benefits for members – something the board had been working for since the bank’s insolvency in 2008.
A settlement between the pension scheme and Lehman Brothers International Europe (LBIE) funded the deal.
After the US bank collapsed in 2008, prompting administration for its international operations, the UK pension fund entered assessment for The Pension Protection Fund (PPF).
However, the £2bn scheme was left with a significant deficit, leading TPR – supported by trustees and the PPF –to launch legal challenges, demanding funding from subsidiary organisations undergoing administration.
In August last year, the case was finally settled.
The LBIE agreed to fund the scheme to secure a full insurance bulk annuity buyout, with members now also receiving back pay on restricted benefits, and the PPF avoiding the burden.
Gamester expressed his gratitude to the scheme’s advisers and LBIE for securing member benefits in full.
“Since the bankruptcy of Lehman Brothers in 2008, the trustees have been striving to secure the pension benefits promised to members of the scheme,” he said.
This is the first major public bulk annuity deal in 2015 after last year saw a record £12bn of pensions liabilities absorbed by insurers.
It is estimated there has been around £2.5bn of bulk annuity deals so far in 2015, with two buy-in deals worth more than £500m in addition to the Lehmans scheme.
This year has been noticeably quieter than 2014, which saw £4.3bn written in Q1 and £2.5bn in Q2 last year.
Legal & General (L&G) – which dominated the 2014 market, with a 45% market share – today announced £655m of new premiums for Q1 2015, £2.4bn down on last year after it took on £3bn from the ICI Pension Fund.
Rothesay wrote no business in Q1 on the build-up to the Lehmans deal but has now surpassed its performance for the first half of 2014 where it wrote only £556m...
For full story:
http://www.ipe.com/countries/uk/lehmans-scheme-insured-in-675m-deal-with-rothesay-after-tpr-action/10007871.article
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Lehman Brothers Secures UK Pension with Buy-in
May 6, 2015 | Chief Investment Officer
By Nick Reeve
Rothesay Life has agreed a deal with Lehman Brothers International’s UK pension to insure £675 million ($1 billion) of liabilities in the country’s biggest de-risking transaction this year.
The deal follows an agreement struck in August between PricewaterhouseCoopers (PwC)—the administrators of the collapsed bank—and the trustees of the Lehman Brothers Pension Scheme about financing the deficit.
Although the contribution from Lehman Brothers International was not disclosed, in an update from the administrators on April 10 PwC said the payment was “not expected to exceed £120m”. However, Susie Daykin, pensions partner at Travers Smith, which advised the trustees, said the funding shortfall had been “significant”.
The buy-in is expected to become a full buy-out once the pension fund exits the Pension Protection Fund’s assessment period, which it entered in late 2008. Since this point, pension payments have been restricted in accordance with the rules of the UK’s defined benefit pension lifeboat fund, but these are expected to be lifted in July or August.
“Since the bankruptcy of Lehman Brothers in 2008, the trustees have been striving to secure the pension benefits promised to members of the scheme,” Peter Gamester, chairman of the trustees, said. “The agreement with Rothesay Life achieves this goal as it enables members’ defined benefit entitlements to be paid in full.”...
For full story:
http://www.ai-cio.com/channel/RISK-MANAGEMENT/Lehman-Brothers-Secures-UK-Pension-with-Buy-in/
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Lehman Scheme Seals £675m Deal To End Six-Year Saga
May 6, 2015 | Professional Pensions
By Stephanie Baxter
Lehman Brothers Pension Scheme has secured a £675m buyout with Rothesay Life, ensuring that all members will get their pensions in full, six and a half years after its sponsor went bust.
The deal – the biggest bulk annuity written this year – comes after the 2,500-member scheme reached a £184m settlement with administrators of the failed bank.
This settlement was the result of a six-year legal battle as group companies challenged Financial Support Directions handed out by The Pensions Regulator.
Further reading Lehman Brothers: Settling the saga Lehman Brothers FSD case settled Lehman Brothers’ maximum FSD liability decision due today Eleco scheme to enter PPF after company restructuring
The money plugged the deficit of the scheme, which had been in Pension Protection Fund (PPF) assessment, keeping it out of the lifeboat fund.
From July, members will receive their benefits in full including backdated payments to cover pensions lost when these benefits were restricted over the PPF assessment period.
Trustee chairman Peter Gamester said: "Since the bankruptcy of Lehman Brothers in 2008, the trustees have been striving to secure the pension benefits promised to members of the Scheme. The agreement with Rothesay Life achieves this goal as it enables members' defined benefit entitlements to be paid in full."
The scheme will hold the buy-in as an asset and will continue to pay out benefits, until it is wound up and members are issued with individual policies with Rothesay Life.
The deal includes a full risk transfer, which means the insurer will pick up the tab if a data cleanse throws up any surprises.
PwC acted as lead adviser on the deal, with legal advice provided by Travers Smith and Wragge Lawrence Graham & Co and actuarial and investment advice provided by Aon Hewitt.
Aon Hewitt partner Paul Belok said: "This transaction has been very complex given the detailed negotiations that have taken place regarding the shortfall in assets, and we are delighted at the outcome that members will now receive their benefits in full rather than at the reduced level that has applied since 2008."
PwC said the deal was completed after a "rigorous competitive tender exercise" and using its pensions analytics software to track insurer pricing...
For full story:
http://www.professionalpensions.com/professional-pensions/news/2407192/lehman-scheme-seals-gbp675m-deal-to-end-six-year-saga
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Lehman Brothers Agrees £675 Million Pension Buy-In
May 6, 2015 | Employee Benefits
By Marianne Calnan
Financial services firm Lehman Brothers has agreed a £675 million buy-in transaction for its pension scheme with insurance firm Rothesay Life, following its application for bankruptcy in 2008.
The buy-in has also secured full employee benefits for all members as a result of the settlement between the pension scheme trustees and the joint administrators of Lehman Brothers International (Europe), which was announced in August 2014.
Aon Hewitt provided scheme actuary and investment advice, as well as advising the trustees on the transaction.
Paul Belok, partner and risk settlement specialist at Aon Hewitt, said: “This transaction has been very complex given the detailed negotiations that have taken place regarding the shortfall in assets, and we are delighted at the outcome that members will now receive their benefits in full rather than at the reduced level that has applied since 2008...
For full story:
http://www.employeebenefits.co.uk/benefits/pensions/lehman-brothers-agrees-675-million-pension-buy-in/106812.article
Client Attorney Privileged/Attorney Work Product/At Request of Counsel
PMC Bancorp
Rothesay Life
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