Hodge has withdrawn from equity release lending as a result of an agreement to sell 100% of the share capital in its subsidiary Hodge Life Assurance Company Limited (HLAC) to Reinsurance Group of America (RGA).
Hodge will continue to sell all other existing products including RIO and holiday let mortgages and has said it will remain committed to the later life and specialist lending market.
The sale of HLAC allows the Hodge group to focus on scaling its specialist lending business and continue its recent growth in these markets, the company said.
The transaction is subject to regulatory approval.
David Landen, chief executive at Hodge Group, said: “This is a significant transaction for Hodge; allowing us to focus and grow across our specialist markets through Hodge Bank.
“Later life lending remains a key part of our business and we will continue to evolve and develop our product range.
“As a result of the sale, we are withdrawing from the equity release market.
“However, as the longest established equity release lender in the UK, we are looking at opportunities to re-enter this market soon, working with third party funders.”
Deian Jones, managing director of HLAC, added: “HLAC’s growth in recent years has been limited by its small size and high capital requirements.
“The sale to RGA provides a strong, stable long-term home for HLAC’s policyholders.”
The withdrawal of new business will take effect on 19 February 2021 at 5pm when Hodge will cease issuing new business quotes on its annuity and equity release products.
An appropriate amount of time will be allowed for existing quotes and applications to proceed through to completion, Hodge has said.