Pension scheme transfer for Bowmore

MORRISON Bowmore – one of Scotland's oldest whisky distillers – has transferred its pension scheme assets to Paternoster, a specialist insurance company.

The defined benefits scheme of the Japanese-owned distillery, which has about 300 members, is around £3 million in deficit. Bowmore made a contribution of £6m in 2007 and said the remaining shortfall is to be cleared by the end of the year.

The scheme has been transferred to Paternoster on a "phased buyout" basis. This means that members will have the security of an immediate insurance policy from Paternoster, while Morrison Bowmore can pay off the deficit over the agreed, extended period.

Industry commentators view it as a good deal for members and Morrison Bowmore.

Fraser Smart of Bulk Consultants said: "The timing is good as buy-out prices are extremely attractive because of the credit crunch pushing up corporate bond yields and the competitive market for pension liabilities."

Andrew Scott, principal of Punter Southall consulting actuaries, added: "This seems a very sensible strategy, given that Morrison Bowmore had already committed itself to buying out the members' benefits."

Scheme members have been notified by the trustees.