Reinsurer Monument Re is weighing options for its operations, Reuters reported citing undisclosed sources.
The Bermuda-based company and its owners are in talks with Citigroup and Fenchurch Advisory to discuss possible options, including a sale, the sources said.
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With a book value of close to €1.2bn ($1.3bn) as of December 2022, Monument Re reported a decline in its solvency ratio, an indicator of financial strength, last year.
The reinsurer acquires life insurance policies from insurance players such as Allianz and AXA.
According to one of the sources, the company’s ownership structure is fragmented with several institutional and individual shareholders.
These include Enstar Group, Hannover Re, and Caspar Berendsen, a partner at private equity company Cinven.
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By GlobalDataHannover Re, Citi, Enstar, and Fenchurch refused to comment on the development. Cinven partner Caspar Berendsen and Monument Re chairman Jonathan Yates also declined to comment.
In December, Monument Re-listed E-L Financial among its institutional investors, however, a representative for E-L Financial, without elaborating, said it was not a shareholder anymore.
Last year, Monument Re recorded a solvency ratio of 167%, which exceeded the minimum regulatory requirement but was much below the 299% it reported in 2021.
The decline was attributed to modifications in the methodology for valuing solvency, as well as a payout of €202m to lower group debt.
Although the company’s profit after taxes stayed largely flat in 2022, it also reported unrealised losses on its investment portfolio of more than €1.2bn.
Other financial organisations have also experienced a decline in the value of their investments due to rising interest rates.
In April 2021, Allianz sold its closed life book portfolio in Belgium to Monument Re.
