Insurer seeks more private-market investing

Insurers are moving in the direction of the private sector to grow investments, pushing for what one executive calls a more alternative, yield-oriented strategy

Sun Life Financial Inc.’s Steve Peacher said he’ll seek to invest funds into areas other than publicly traded bonds as Deutsche Bank AG’s Randy Brown joins to oversee the insurer’s $135 billion portfolio.

“Over the next couple years, it’s very likely that you’re going to see us make moves to continue to expand the scope of Sun Life Investment Management. That could be acquisitions, that could be organic growth, but we want to grow it,” said Peacher, president of the unit. “We’re looking to expand our menu of offerings in what I will call alternative, yield-oriented strategy.”

Sun Life Chief Executive Officer Dean Connor has been building up asset-management operations at Canada’s third- largest life insurer, announcing deals to acquire Prime Advisors and Ryan Labs Inc. Peacher said the investment businesses could grow through private-market wagers, citing infrastructure equity as an example.

The insurer said on Wednesday that it hired Brown as chief investment officer from Deutsche Bank, where he ran a unit managing assets for insurers. The insights he gained at the bank will be beneficial in helping Toronto-based Sun Life expand its capabilities, Peacher told Bloomberg News.

“He’s got broad experience, and there’s things he’s seen other insurance companies doing that we’re not doing at Sun Life that would fit with what we do and our risk-return,” said Peacher. “He’ll bring just a broad set of experiences.”