The Lloyd’s market has revealed it has secured £300 million to finance its future.
It announced the move as it revealed it would create “ a robust governance, oversight and funding framework which will ensure on-time, on-budget execution of the solutions announced in Blueprint One” of its Future at Lloyd’s prospectus.
The change in governance includes a newly formed Technology and Transformation Committee, overseen by Lloyd’s Board and Council and chaired by Lloyd’s Deputy Chairman. Andy Haste.
However the market also answered the question many have been asking since the plans were unveiled, who will pay for the plans?
The answer is debt.
“To ensure funding is available to meet the near and medium-term cash requirements of the Future at Lloyd’s, the Corporation has taken advantage of the low interest rate environment and secured £300m of senior debt, thereby avoiding any increase in market levies,” it explained. “The secure financial position of the Corporation will support the year-on-year costs of the Future at Lloyd’s as the benefits stream begins to be delivered.”
The market has been littered with failed transformational initiatives the most infamous of all the Kinnect scheme which collapsed after funding of £70 million.
Lloyd’s plans have been welcomed but there remains a degree of scepticism over its ability to deliver and the impact in the market’s make up.
Lloyd’s said the scheme has been designed on an ‘agile’ basis with the funding for each quarter being dependent on the execution of the planned deliverables. In February 2020, Lloyd’s will publish Blueprint 1a, which will set out the detailed plans and deliverables for Phase 1 implementation.
John Neal, Lloyd’s Chief Executive Officer, (pic) said: “Since the launch of Blueprint One, we have focused on designing a carefully structured and managed approach to planning and execution to allow regular delivery of value to the market. With robust governance and oversight now in place, and the funds for delivery secured, we have every confidence in the successful delivery of the Future at Lloyd’s.”