Irish Life has paid €764m in dividends to Canadian parent since its sale by State
This equates to almost 60% of €1.3bn Great-West Lifeco paid State to acquire Irish Life in 2013
Irish Life Group saw its profit soar to €272 million last year from €108 million in 2018. Photograph: Chris Bellew/Fennell Photography
Irish Life Group paid €234.3 million in dividends to its overseas parent last year, bringing total payments since it was bought from the State during the financial crisis to €764 million.
The total amount, paid up to its immediate parent, UK-based Canada Life Limited, which is ultimately owned by Great-West Lifeco in Winnipeg, equates to almost 60 per cent of Irish Life’s €1.3 billion purchase cost seven years ago.
Irish Life Group, the holding company for the Republic’s largest life assurance and pension company and third-largest health insurer, saw its profit soar to €272 million last year from €108 million in 2018, according to its latest annual report, filed with the Companies Registration Office.
This was driven by dividends from its main subsidiary, Irish Life Assurance, which more than tripled to €250 million. Irish Life Health did not pay a dividend last year as its earnings fell due to higher claims. This business was created in 2016 as Irish Life Group acquired control of Aviva Health and the 51 per cent of GloHealth it didn’t already own, and merged both.
In a statement on the results to The Irish Times, Irish Life said: “As part of our commitment to Ireland we have substantially re-invested in the business to develop our customer offering with major acquisitions in health insurance, wealth management and employee benefits consultancy, and substantial IT infrastructure and data security projects. During this period, we’ve increased our total headcount to over 2,900 people.”
The State’s sale of Irish Life, a business it ended up owning at the height of the financial crisis, came months before it exited an international bailout programme. The deal was hailed at the time by government officials as a sign of renewed demand for Irish assets as the economy was beginning to recover from the crash.
Then minister for finance Michael Noonan defended the price achieved in the face of questions from Opposition, saying it valued the business at 12 times earnings, slightly above the ratio at which a number of UK peers were trading, and at a 30 per cent premium to its net assets.
The government had bought Irish Life in 2011 from Permanent TSB, then known as Irish Life & Permanent, for €1.3 billion in order to limit the taxpayer bailout bill for PTSB. It subsequently sold the business in 2013 for the same price to Great-Life Westco.
A prior plan to sell on Irish Life in late 2011 was abandoned due to the raging euro zone debt crisis at the time.
Mr Harney became president and chief operating officer Europe of Great-West Lifeco after four years as head of the Irish business.