Standard Life suspends property-linked life bond withdrawals

Added 3rd August 2016

Customers with investments in Standard Life’s assurance bonds have been told they cannot access their money if any part - however small - of their funds are in ill-fated UK commercial property funds.

Standard Life suspends property-linked life bond withdrawals

The insurance giant confirmed it has put a “temporary” ban on customers withdrawing money from its bonds if part of their investments are held in commercial property funds.

Last month, five of the largest UK property authorised investment funds (Paifs), among others, suspended trading in the wake of market volatility caused by the Brexit vote.

The insurer said the freeze on withdrawals was down to “how part surrenders are processed on our system,” explaining that it is working to “resolve the issue as possible”.

“The restriction comes into place as a result of property funds being suspended for trading or deferring withdrawals. The timing of the bond restriction coincides with the restrictions on the fund or funds,” said a Standard Life’s spokesperson.

“We are liaising with the small number of customers and advisers currently impacted by this issue and we are working on a solution to allow us to meet these requests.”

The limit applies to three suspended property funds - the £4.4bn ($5.8bn, €5.2bn) M&G Property Portfolio Life fund, the £1.8bn Aviva Investors Property Trust Life fund and the £4bn Henderson UK Property Life fund.

The move by Standard Life to prevent its clients accessing their investment funds inside a life assurance wrapper is unlikely to affect other life company bonds as each firm has its own rules as to how clients can access their capital.

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Monira Matin

Senior Reporter

Monira joined International Adviser in March 2016 from Informa Global Markets where she worked as a eurobond reporter for over two years, covering fixed income markets. She has previously held a number of editorial positions covering politics, insurance and technology. Monira has a degree in Journalism and Economics from City University.

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