Friends Life Investments will be a 100%-owned subsidiary of the Friends Life Group and is expected to launch in the second half of next year. It will be seeded with £8bn of what the firm describes as “recaptured assets” which is essentially the existing fixed income assets that are currently being used in the Friends Life annuity book and shareholder funds.
Notice will be served to those managers currently running the assets, Axa Investment Managers in the main alongside F&C.
As well as fixed income, Friends Life Investments will also look to build up its annuity and shareholder assets with more investment classes to come over time.
The business will be run by chief investment officer Mark Versey and will leverage its capability in investment strategy and asset liability management. The majority of the investment operations including administration and customer service will be outsourced.
Andy Briggs, chief executive officer of Friends Life said: "The launch of Friends Life Investments marks a significant development for our business. The intention is for this new company to build on existing expertise across our business and is further evidence of our strategic focus in the UK."