Truist and Fifth Third pause Delaware Life products amid probe

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3▲0 ▼2Impact / 5
Summary · why it matters

Truist Financial and Fifth Third Bancorp have paused distribution of products tied to billionaire Mark Walter's Delaware Life Insurance as a U.S. federal investigation intensifies, Bloomberg reported Friday. The probe has also delayed a planned $10 billion investment in Walter's TWG Global led by Abu Dhabi sovereign wealth fund Mubadala Investment Co. The Securities and Exchange Commission and Department of Justice are examining Walter's insurers and Guggenheim Partners, focusing on more than $20 billion of loans on the insurers' balance sheets that should have been classified as affiliated but were not until this year. Truist and Fifth Third suspended their roles as distribution channels for Delaware Life amid concerns about the insurer's credit ratings, which were lowered by S&P Global Ratings, AM Best, and Fitch Ratings in July. TWG has denied wrongdoing, stating that no one has been harmed, and has submitted a plan to regulators to eliminate affiliate exposure, which the Delaware Department of Insurance is reviewing. The Mubadala-led investment remains incomplete about 15 months after announcement, part of a broader $15 billion equity raise, while Walter has agreed to sell the Los Angeles Lakers at a $12.5 billion valuation.

Impact on assets 4

Financials▼
Fifth Third Bancorp
FITB
▼ NegativeRegulationrelevance

Fifth Third paused distribution of Delaware Life products amid SEC/DOJ probe and credit-rating downgrades.

Truist Financial Corp
TFC
▼ NegativeRegulationrelevance

Truist suspended its role as a distribution channel for Delaware Life amid the federal investigation.

Cloud & Digital Infrastructure▲
Consumer Staples▲

Off-coverage companies 7

Delaware Life Insurancei
Private▼ NegativeRegulationrelevance

Delaware Life is under SEC/DOJ examination over misclassified affiliated loans and saw its credit ratings cut.

TWG Globali
Private▼ NegativeRegulationrelevance

TWG Global's $10B Mubadala-led investment is delayed amid the probe, though it denies wrongdoing.

Guggenheim Partnersi
Private▼ NegativeRegulationrelevance

Guggenheim Partners is being examined by the SEC and DOJ alongside Walter's insurers.

AM Besti
Private± Mixedrelevance

Fitch Ratingsi
Private± Mixedrelevance

Los Angeles Lakersi
Private± Mixedrelevance

Mubadala Investment Companyi
Private± Mixedrelevance