Lloyd's managing agent Creechurch will merge its three Lloyd's syndicates.

The move will see syndicates 2607 and 2962 merged into Syndicate 1607.

Chief executive Bruce Graham said the new merged Syndicate 1607 would have capacity of "just over" £50m for 2005.

The three syndicates have a combined 2004 capacity of £55.7m. The active underwriter of Syndicate 1607 will be Jonathan Thomas.

Graham said that, though the merger would result in some cost savings, the main reason behind the move was to improve the administration of reinsurance.

"We will be able to place quota share reinsurance through one syndicate," he said. "There are cost savings, but that's not the driver."

Graham added that the merger would also enable Creechurch to make savings on transaction costs paid to Xchanging.

Earlier this year, the Creechurch Group sold the entire issued capital of Creechurch Holdings to a subsidiary of the Logan Trust Group, which also owns motor insurer Hastings. Following the acquisition, Hastings Insurance Services chief executive David Gundlach will become chairman of the board of Creechurch Holdings.