Key Takeaways
- • M&G has secured a £400 million mandate from a UK defined benefit pension scheme for its new CDI+ run-on solution, the first mandate for the product.
- • CDI+ combines M&G Investments' fixed income and liability-driven expertise with insurance capabilities from M&G Life, allowing schemes to reduce assets held for liquidity and collateral while keeping more capital in higher-return assets, including private markets.
- • The solution spans the full range of endgame strategies, from self-managed and delegated run-on arrangements through bulk purchase annuities and consolidation vehicles such as superfunds and master trusts.
- • M&G Life's bulk purchase annuity business is targeting £3-4bn of annual volume by 2027 through BPA Plus, supported by the £138bn With Profits Fund.
- • M&G Investments manages £145bn in fixed income on behalf of pension schemes and insurers, a track record of more than 30 years.
Summary
M&G has announced a £400 million mandate from a UK defined benefit pension scheme for CDI+, a run-on solution that combines the strengths of its asset management and insurance businesses. The company described the mandate as the first for the product and said it reflects growing interest in run-on strategies among well-funded pension schemes.
CDI+ is designed for well-funded defined benefit schemes seeking to generate additional value by reducing the assets they must hold to meet liquidity and collateral requirements, while retaining flexibility over endgame planning. The product draws on M&G Investments' expertise in managing assets to meet future pension payments and protect against inflation and interest rate risk, paired with insurance capabilities provided by M&G Life. By using M&G Life's insurance capabilities to support liquidity needs, the solution allows assets to remain invested in higher-return allocations, including private markets, for longer, while giving trustees greater confidence that payments can continue during periods of market volatility.
According to M&G, CDI+ supports schemes across the full range of endgame strategies, from self-managed and delegated run-on arrangements to bulk purchase annuities or other forms of consolidation. The company noted that the launch comes as more well-funded schemes consider running on assets before buyout, alongside a growing consolidator market including superfunds.
M&G's £145bn fixed income business has invested on behalf of pension schemes and insurers for more than 30 years. It is combining that track record with M&G Life's growing bulk purchase annuity business, which targets £3-4bn per annum by 2027 through BPA Plus, supported by the £138bn With Profits Fund.
Gurbani Swanni-Leach, Head of Pension Solutions at M&G Investments, said CDI+ creates an insurer-backed run-on solution for defined benefit schemes and potentially for consolidators such as superfunds and master trusts. Kerrigan Procter, Managing Director, Corporate Solutions at M&G Life, said the product lets schemes "invest like an insurer, with an insurer," and positions it alongside the bulk annuity offering as support across the journey from running on assets to securing member benefits through buyout.
CDI+ is designed for well-funded defined benefit schemes seeking to generate additional value by reducing the assets they must hold to meet liquidity and collateral requirements, while retaining flexibility over endgame planning. The product draws on M&G Investments' expertise in managing assets to meet future pension payments and protect against inflation and interest rate risk, paired with insurance capabilities provided by M&G Life. By using M&G Life's insurance capabilities to support liquidity needs, the solution allows assets to remain invested in higher-return allocations, including private markets, for longer, while giving trustees greater confidence that payments can continue during periods of market volatility.
According to M&G, CDI+ supports schemes across the full range of endgame strategies, from self-managed and delegated run-on arrangements to bulk purchase annuities or other forms of consolidation. The company noted that the launch comes as more well-funded schemes consider running on assets before buyout, alongside a growing consolidator market including superfunds.
M&G's £145bn fixed income business has invested on behalf of pension schemes and insurers for more than 30 years. It is combining that track record with M&G Life's growing bulk purchase annuity business, which targets £3-4bn per annum by 2027 through BPA Plus, supported by the £138bn With Profits Fund.
Gurbani Swanni-Leach, Head of Pension Solutions at M&G Investments, said CDI+ creates an insurer-backed run-on solution for defined benefit schemes and potentially for consolidators such as superfunds and master trusts. Kerrigan Procter, Managing Director, Corporate Solutions at M&G Life, said the product lets schemes "invest like an insurer, with an insurer," and positions it alongside the bulk annuity offering as support across the journey from running on assets to securing member benefits through buyout.
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