Last checked at 22 Aug 2011 09:36
22 August 2011
ITV plc confirms longevity swap executed by ITV Pension Scheme
ITV plc ('ITV') and the Trustee of the ITV Pension Scheme announce today that they have removed the risk of increases in pension liabilities that would arise if a significant proportion of the scheme's defined benefit pensioner population were to enjoy a longer life than currently expected. This has been achieved through the Trustee entering into a longevity swap contract with Credit Suisse.
The longevity deal is another measure implemented as part of the long-term strategy to manage the risks and uncertainties associated with the Scheme.
The impact of the swaps on the overall Scheme deficit is an increase of around £50m on both the accounting and funding basis. This equates to around a one year change in life expectancy.
As announced in ITV's recent interim results, the SDN pension partnership originally agreed last year has been extended. The benefit of the extension is broadly equivalent to the impact on the funding deficit arising from the longevity swap contract. As a result, no further change is expected in ITV's contributions to the main section of the Pension Scheme before 2015.
Ian Griffiths, ITV's Group Finance Director, said:
"Over the last couple of years, ITV has made significant progress in strengthening its balance sheet and managing its pension risk. This latest initiative is a further significant step in reducing the exposure of our business to legacy pension risk."
Graham Parrott, Chairman of the Trustee of the ITV Pension Scheme said:
"The Trustee has worked closely with ITV over several months and this agreement removes significant risk from the Pension Scheme and so therefore enhances the security of all members' benefits."
Note to Editors:
1. ITV was advised by PWC and Hogan Lovells
The Trustee was advised by Towers Watson, Sacker, Mercer and Penfida
For further information:
ITV plc
Investor Enquiries
Ed Steel 020 7157 6560
Media enquiries
Mike Large 020 7157 3021
Caroline Cook 020 7157 3709
Website: www.itv.com; investor information: www.itvplc.com