Irish Life & Permanent (IPM.I) has suspended
the sale of its life insurance arm and the Irish government will likely have to
put 1 billion euros into the bancassurer to meet tough new capital requirements
under an EU-IMF bailout.
Canada Life had been the lead candidate to buy
the business, but the price and economic turmoil killed all bids. With a 4
billion euros capital hole, the bancassurer had put Ireland's largest life
insurer up for sale earlier this year.
Ireland's government has already poured 2.7
billion euros into Irish Life & Permanent, and was relying on the sale of
the life insurance arm to avoid having to use more public funds to shore the
Irish Life & Permanent will separate its life
business and banking arm by March 2012.
Life insurance news: 2 December 2011