2nd October 2022

Moody's Investors Service publishes sector comment on UK life insurers
Trend

From the report:
"UK government bond prices have fallen sharply over the past week, with yields on 30 year gilts peaking at around 5.1% on 28th September before Bank of England (BoE) announced steps to stabilize the market. The near 1.4 percentage point rise in yields since 23rd September triggered significant margin calls on interest rate hedges collateralised by gilts. We expect that large UK life insurers would have been able to absorb the cash collateral requirements within their liquidity buffers, and that they are well positioned to navigate possible additional volatility when the Bank of England scales back its intervention."

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