The Insider pulls out his crystal ball for a couple of potential sales, and gets ready for one hell of a Tube journey
I’ve enjoyed a few brandies in my time, and have always been able to hold my own, but the gauntlet has certainly been thrown down by my old pal Mike Smith, who heads up Ink Underwriting. Smith has challenged me, and a few others, to the Circle Line pub crawl. The infamous challenge involves having a drink at every one of the Circle Line’s 27 stops before finally finishing where you started. For a six-foot-seven giant like Smith, that’s probably a walk in the park, but for us mere mortals, it’s quite a challenge. A broker executive who’s completed the pub crawl, told me: “Certainly a memorable experience, but only up to the point where you black out.” Hmm, I think I’ll be sticking to the shandies …
For sale, at a Premium?
I’ve got my speculative hat on right now. I’m predicting there’s good chance that Bank of America (BoA) will put insurance premium finance firm Premium Credit up for sale at some point. The bank is under pressure to raise $3bn (£1.9bn) in asset sales this year, with more sales on the cards thereafter. BoA sold a US insurance unit last month and the chief executive, Brian Monihyan, said he wanted to get rid of “non-core activities”. BoA was reportedly looking to sell Premium Credit in 2006 for around £300m, so why not again? My guess is the big cheeses at BoA would sell up if there was a good offer on the table.
NIG reshaping up nicely
Talking of sales, what’s next for NIG? The broker-only insurer has made the rather dramatic decision to put its personal lines motor book into run-off, draining nearly a quarter of a billion in capacity. Its once good reputation will have suffered badly with the broking community. But once the dust has settled, the commercial book should be in okay shape. Last year, it wrote net £157m commercial property and £62m residential property, with loss ratios in the mid-forties. My guess is that the bank will sell off a cleaned up commercial-dominated NIG separate from the rest of the group. I would imagine that an acquisition-hungry Fortis, keen to boost its commercial book from around 10% of business to one-third, is watching developments very closely.
A bit of a do
On a lighter note, congratulations to Neil Utley, who got married on his farm at the weekend. I couldn’t make it, following a recent knee operation (ouch). However, I’m told it was great fun. The ‘official’ marriage was completed on Friday, coinciding nicely with his parents’ 50th wedding anniversary, and attended by a small group of family and friends, before the celebrations began in earnest on Saturday.
Among the treats were helicopter rides and tennis for the adults, and bumper cars, fun-fair rides and karaoke for the kids. A nice little black-tie event, drizzled with plenty of champagne, kept the guests partying late into the night. Grandees of insurance like Towergate chairman Peter Cullum and Fortis chief executive Barry Smith attended. How I would have loved to have been a fly on the wall (preferably one armed with a camera) when the disco dancing began.
Last but not least, I hear from my pals at Insurance Times that there has been a fresh flurry of support for its estimable ‘Fair Fees: Brokers won’t pay for banks’ petition. Among those signing up are fans of the social networking website Twitter, who have been adding their tweets of support by including #fairfees in their messages. We all hope and trust that the ‘twits’ at FSA headquarters will take some notice, so log on to insurancetimes.co.uk/backfairfees and add your name to the growing swell of support, among both brokers and insurers. IT