Addy Loudiadis is stepping down as chief executive of Rothesay, a group she co-founded within Goldman Sachs 15 years ago and has since turned into the largest UK pensions insurance specialist.
Rothesay operates in the so-called bulk annuity market, where companies pay insurers to take over their corporate pension liabilities and the assets backing them. Companies are increasingly taking this route to shift legacy pension funds off their balance sheets.
Rothesay was founded in 2007 as a unit within Goldman by Loudiadis and Tom Pearce, its managing director who today replaces her as chief executive. It later flirted with an initial public offering before Goldman sold its remaining stake in 2017. Rothesay is now backed by US insurer MassMutual and Singapore sovereign wealth fund GIC and was last valued at £5.75bn two years ago.
“Rothesay will always be my heart,” Loudiadis told the Financial Times. “I just wanted to be remembered as doing this particular business model very well, without wanting to be everything to everybody.”
Loudiadis described the original unit within Goldman as “a box with just Tom and I”, and the pair have struggled to shake off the perception that they are bankers rather than insurance executives.
“Still to this day, people will not call us insurance people for whatever reason,” said the 59-year-old, who plans to take a break before focusing on philanthropy.
The bulk annuity market is lumpy with big deals following complex and drawn-out negotiations with employer and pension scheme representatives.
In the early days, “there were certainly times when one deal was life and death”, Loudiadis said. A £4.7bn buyout of Telent’s pension scheme three years ago was the largest yet for the sector. Rothesay now looks after the pensions of 830,000 people and has more than £60bn in assets.
Rothesay chairman Naguib Kheraj said Loudiadis had built “an amazing business from a start-up”, adding: “That is quite exceptional . . . in an industry that didn’t exist when she started.”
Loudiadis hands over the business at a time where bulk annuity deals are soaring — but competitive pressures are growing as bigger groups such as Aviva look to build up their presence in the market.
“The biggest things for us are to be patient and do the right deals at the right time,” said the 43-year-old Pearce, pointing out that it does not have annual volume targets.
Loudiadis said there had been “highs and lows almost in one day” during her time at Rothesay, recalling how she had phoned Pearce at 2am in the morning after the Brexit vote, calling everyone into the office a couple of hours later to manage the impact of the fallout in currency and bond markets. “We were able to trade it overnight and we were absolutely fine,” said Pearce.
At Goldman, Loudiadis was previously co-head of the bank’s European investment banking division and in 2001 helped Greece meet European deficit rules by arranging a derivatives deal years before the country’s debt crisis.
As she steps down from Rothesay, Loudiadis called for a resolution to the tussle between the UK government, the insurance industry and regulators on the long-discussed overhaul of Solvency II regulations.
“I would urge the industry . . . to drive to some solution sooner rather than later, simpler rather than more complicated,” Loudiadis said. “Whatever it is, live with it and move on.”
She will continue as non-executive founder director on Rothesay’s board as well as trustee of the Rothesay Foundation.