Lincoln National Corp. (LNC:US) hired Ellen Cooper to be chief investment officer as lower interest rates pressure income on a bond portfolio valued at more than $70 billion.
Cooper, 47, joins from Goldman Sachs Group Inc. (GS:US)’s asset- management business where she was a managing director and global head of insurance strategy. She’ll report to Lincoln Chief Executive Officer Dennis Glass, 62, the Radnor, Pennsylvania- based insurer said today in a statement.
Insurers including MetLife Inc., Prudential Financial Inc. and Aflac Inc. have turned to new money managers to maintain investment results amid lower yields on the safest bonds. Lincoln’s portfolio included more than $60 billion in corporate bonds as of March 31, according to a regulatory filing.
Cooper, who starts Aug. 6, has “a deep background in asset management, risk management and insurance,” Glass said in the statement. “The wealth of experience she brings to the role will be a benefit to the company and our clients.”
She has also worked for Aegon NV and Ernst & Young LLP, according to the statement. Cooper received a bachelor’s degree from Temple University in Philadelphia. Cooper takes over duties previously handled by Fred Crawford, who was hired by insurer CNO Financial Group Inc. as chief financial officer in January.
Lincoln slipped 2.1 percent to $21.42 at 4:15 p.m. in New York. The seller of life insurance and annuities fell (LNC:US) 27 percent in the past year as the Federal Reserve said its benchmark interest rate will remain low until at least late 2014.
“We expect low interest rates to be a multiyear headwind” for Lincoln, Barclays Capital analysts including Jay Gelb wrote in a research note today before her hiring was announced.
Mike Siegel, global head of the Goldman Sachs insurance asset-management operation, will assume Cooper’s responsibilities for the insurance strategy team, said Andrea Raphael, a spokeswoman for the New York-based bank, in an e-mail today. The insurance asset-management business oversees more than $125 billion.
Goldman Sachs last month hired Robert Goodman as managing director, global head of insurance relationships. Goodman, who previously worked at Deutsche Bank AG as global co-head of Deutsche Insurance Asset Management, is a graduate of Harvard Law School.
Cooper is the latest departure from the Goldman Sachs insurance asset-management unit. Eric Kirsch, who was global head of insurance asset management, left the bank to become chief investment officer at Columbus, Georgia-based Aflac, the seller of supplemental health insurance said in September.
Goldman Sachs is making a “substantial investment” in overseeing insurers’ funds as more companies pay external managers to handle portions of their portfolios, according to the firm’s annual report.
“We have seen an increase in the outsourcing of insurance asset management globally, which has been accelerated by new capital regimes, greater demand as a result of the financial crisis and a sustained low interest-rate environment, making it more difficult to generate returns,” CEO Lloyd Blankfein and President Gary Cohn wrote in the report.
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