Is Phoenix’s flight over?

There have arguably been few better times to invest in private equity (PE) – valuations are cheap as interest rates have harrowed the sector. Unfortunately, the timing of Phoenix Group’s (PHNX) purchase (via its with-profits book rather than a corporate investment) of a 5 per cent stake in PE firm Hambro Perks, a few days before the Financial Conduct Authority announced a wide-ranging investigation into valuations the sector reports, could hardly have been worse. It follows on from accounting changes under IFRS 17 that could make the kind of expansive closed book buying that the company specialises much harder under a regime that is stricter on solvency levels.