The bank said it was tackling a legacy life insurance portfolio that dates back 15 years.

Zurich-listed EFG International has said that divesting a “synthetic life insurance portfolio” it acquired 15 years ago will boost its earnings in the first half of 2025.

The divestment, along with EFG’s placement of SFr340 million ($379 million) of senior unsecured debt with Swiss investors by EFG Bank AG, will “further strengthen EFG’s balance sheet and is a testament to EFG’s commitment to de-risk legacy matters.” (The placement was announced last week.)

The Swiss firm issued its 2024 results on 19 February.

“EFG has made further progress in de-risking its life insurance exposure and has divested its synthetic portfolio of life insurance exposure (consisting of direct holdings of life insurance policies, plus hedge instruments for 44 insureds as at 31 December 2024),” it said.

A synthetic life insurance portfolio is a collection of synthetic financial instruments that are designed to mimic other financial instruments. Synthetic instruments, according to one online definition, are custom-made investments that can be used to replicate the cash flows of an asset without owning it.

“The sale is expected to have a slightly positive impact on EFG’s earnings in the first half of 2025,” the firm said.