Scottish Re, despite its name, has no connections with Scotland whatsoever, although its Bermuda-based parent company feels that the name “suggests prudence with money”.
The life reinsurance group, however, has recently hit troubled waters. Scottish Re, at the beginning of May, posted a first-quarter net loss of $35.5m (£17.92m), compared with a gain of $13.8m (£6.97m) in the first quarter of last year.
But George Scott, international legal counsel, says the future for the business is looking up and that Scottish Re is entering “a very exciting time”.
On 7 May Scottish Re received a $600m (£302.92m) injection of cash from investors MassMutual Capital Partners and Cerberus Capital Management.
“Both investors will bring a great deal to the company,” says Scott. “They of course bring very solid capital resources and liquidity that shores up Scottish Re’s books, but they’ll also bring experience.
“MassMutual are well versed on the life side and Cerberus have talents in turning around businesses.”
Scott, who joined Scottish Re in February 2004 after four years as a senior legal counsel with Royal & SunAlliance, admits that, for the past year, much of his role has been “defending” the work that the company has managed to pull in over the past two years, rather than building up a new client base.
“But with the new investment it means we have an improved credit ratings outlook and are back on track to continue growing the international side of the business,” he says.
Scottish Re was founded in 1998 as Scottish Annuity & Life Holdings and has since been acquiring businesses across the world. The company’s UK branch was launched after Scottish Re acquired World-Wide Reassurance in December 2001, which had been writing reinsurance business for 40 years from its Windsor base.
Since its beginnings in Windsor the UK arm of Scottish Re has moved to new premises at Tower Bridge House at St Katherine’s Dock, near the City. The move nine months ago came at a time when the company was boosting its focus on international business, an area in which Scott is very much involved.
Scott became Scottish Re’s first in-house lawyer based in the UK and, with his right-hand man William Keen, is responsible for all legal issues outside of the US.
Scott’s main responsibility is supporting international reinsurance business and the expansion of Scottish Re, but he also fulfils the functions of chief risk officer and company secretary, and sits on the executive management board in that role.
Additionally, he looks after the heavy compliance requirements of the reinsurer and sits among the actuaries, right in the centre of day-to-day life at the company.
Since in-house lawyer Keen joined the reinsurer’s legal team in the UK, Scott has tried to keep as much reinsurance work as possible in-house.
“Working with the actuaries and underwriters on a daily basis means we’re immersed in the intricacies of the business, which I think puts us in a better position that lawyers in private practice to know what Scottish Re needs,” says Scott. “That’s why I prefer, where possible, to get the job done internally; although we’ll go to the likes of LeBoeuf [Lamb Greene & MacRae] for advice and where it’s clearly obvious the issue is outside of our expertise.”
Scott says he does not currently have any plans to expand the team, but “if we’re very, very successful then I’d have preference for taking on more internal personnel to support the business”.
He adds: “Until that time arises, however, I can see secondments from private practice as an interim solution, as it would enable us to maintain the close interaction with businesspeople I think is essential to supporting a business.”
Scottish Re’s ambition to expand has seen divisions spring up in the UK and most recently in Singapore and Japan.
Scott explains: “Asia’s a market with huge potential for growth, given the demographic and economic forces at play. The UK is traditionally one of the world’s largest markets for life reinsurance and also provides significant new opportunities.
“For instance, I can see a growth in the longevity areas, as several newly established players are looking to acquire some of the huge amount of pension liabilities from final salary schemes.
“At the moment there’s only a trickle, but it just takes one FTSE company to get the ball rolling.”
International legal counsel and company secretary
|Total number of employees :||75 (UK), 400 (worldwide)|
|Legal capability :||Two (International), five (US)|
|International Legal Counsel and Company Secretary:||George Scott|
|Reporting to:||International CEO David Howell|
|Main law firms:||Clarks and Maples Teesdale, Clyde & Co, LeBoeuf Lamb Greene & MacRae|
|George Scott ‘s CV||