|
|
At least one disposal is certain: the European Commission has ordered Dutch group ING to offload its insurance and investment management business in the US – along with that in other regions – as a condition for receiving state aid during the financial crisis.
Regulatory concerns could also push Europeans to sell their US operations in a less direct manner, say analysts. The capital-intensive nature of many US life assurance products make American operations obvious disposal candidates for European groups whose regulatory capital positions are a potential problem.
Still, new rules threaten to bring matters to a head. Brussels is in the process of deciding which countries it deems to have an “equivalent” regulatory system to Solvency II, the capital requirements regime due to take effect at the start of 2014. Unless a country is deemed equivalent, EU-based insurers’ overseas operations would have to comply with Solvency II as well as local rules.
Kevin McCarty, president of the National Association of Insurance Commissioners, indicated last month that US regulators had no intention of becoming equivalent.
Full article (FT subscription required)