Athene Holdings has agreed to increase the protections it offers annuity customers in order to secure a New York regulator's approval of its planned acquisition of the British insurer Aviva.

Athene, an affiliate of Apollo Global Management, agreed to implement new safeguards requested by the New York State Department of Financial Services, which has raised concerns over the growing number of private-equity firms that are buying insurance companies. Guggenheim Partners agreed to a similar set of protections last month as part of its planned acquisition of the Sun Life Insurance and Annuity Company of New York.

New York required both Athene and Guggenheim to agree to the new protections in order to secure the regulator's approval of the acquisitions. The enhanced protections are needed because private-equity firms generally seek short-term profit, while annuities are designed to provide long-term security, the agency said in a news release.

"We've worked to build a new model for policyholder protections that will help address the emerging trend of private equity firms and other investment companies entering the annuity business," Benjamin Lawsky, superintendent of the Department of Financial Services, said in the news release. "When it comes to these sorts of deals we need to ensure we are putting retirees who depend on these annuities first."

The safeguards that Athene agreed to put in place include holding higher risk-based capital levels, establishing a $35 million backstop trust, submitting plans for any material changes to the DFS for approval and filing reports with the regulator quarterly, rather than annually, as New York law requires.

Several large banks, including Wells Fargo (WFC) and BB&T (BBT), have bought insurance-related businesses in recent years, and annuity sales are a significant part of many banks' wealth management offerings.

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