Kommunal Landspensjonskasse (KLP) has sold its wholly-owned pensions subsidiary, KLP Bedriftspensjon AS, to DNB Livforsikring AS, the bank’s life insurance arm for an undisclosed amount.

Established in 2006, KLP Bedriftspensjon AS offers defined contribution pensions including the management of pension capital certificates and paid-up policies, to companies in the private and public sectors.

“We are very pleased to have found such a strong player as DNB, the buyer of KLP Bedriftspensjon. We are confident that the company and our customers will benefit from being part of a larger community,” KLP CEO Sverre Thornes, said.

DNB Livsforsikring CEO, Anders Skjævestad, said that DC pensions are a focus area for DNB, and that with low interest rates and demographic changes, saving for a pension has become even more important.

“KLP Bedriftspensjon has a strong position as a supplier of defined contribution pensions to public-sector enterprises and has focused on index funds and sustainable management. These are initiatives that we want to continue under DNB. As part of this, we will also be launching new sustainability profiles for defined contribution pensions this autumn,” he said.

KLP said that due to changes in public occupational pensions at the beginning of the year, KLP Bedriftspensjon has less strategic importance for the company.

“It requires a considerable effort to achieve profitability, and this means, among other things, increasing volume and IT investments. DNB already has a solid position in this market, and the muscles to do what is needed,” Thornes said.

KLP Bedriftspensjon had 3,183 corporate customers at the end of the first quarter of 2020, which comprise a total of 69,232 active members and owners of pension capital certificates and paid-up policies. Total assets are NOK 6.98bn. The company has nine employees and an office in Oslo.

The sale requires approvals from the Financial Supervisory Authority and the Competition Authority and is expected to be completed during the third quarter of 2020.

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