19 Nov 2019
Legal & General: Business Update
Legal & General Group Plc (“Legal & General” or “the Group”) announces that it expects to launch shortly a GBP-denominated benchmark Tier 2 subordinated debt issuance, taking advantage of current favourable market conditions. The Group will confirm the amount of debt raised after the issuance has settled.
Legal & General also highlights that:
- LGRI (our Institutional Retirement business)has transacted £8.5billion of global Pension Risk Transfer (PRT)to 31 October 2019. This includes a further £1.2billion of UK PRT and a further $0.6billion of US PRT(£0.5billion) written since Half Year 2019. The financial metrics and Solvency II capital strain of these deals are in line with previous transactions. Additionally, LGRI is in exclusive negotiations on a further global PRT pipeline of£3billion which we expect to complete before the year end.
- LGRR (our Retail Retirement business) has achieved individual annuity sales of £829million to 31 October 2019, up 34% year on year. Lifetime mortgage advances were £823million to 31 October 2019, down 15% year on year.
- LGIM (our Investment Management business) has achieved external net flows of £83billion in the year to 31 October, which includes a further £23billion of external net flows since Half Year 2019. LGIM’s AUM as at 31 October is £1.2trillion, an increase of circa £200billion since Full Year 2018.
The Group estimates its year-end Solvency ratio will be in a range of 171% to 176% (H1 2019: 171%). This estimate does not include the benchmark debt issuance announced today, but does include capital we expect to deploy on new business before year-end. It assumes unchanged market conditions to 31 December 2019.
Our business continues to go from strength to strength.Our year-to-date operating performance across all five of our divisions is good reflecting the strong execution of our stated strategy. We remain disciplined in our deployment of capital,and our balance sheet and net cash flow are strong.We are taking advantage of favourable market conditions to raise debt, and remain confident in Legal & General’s ability to grow sustainable profits over the long-term.
Nigel Wilson, Chief Executive, Legal & General
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Notes to editors
Legal & General Group Plc
Established in 1836, Legal & General is one of the UK’s leading financial services groups and a major global investor, with international businesses in the US, Europe, Middle East and Asia. With over £1.2trillion in total assets under management, we are the UK’s largest investment manager for corporate pension schemes and a UK market leader in pension risk transfer, life insurance, workplace pensions and retirement income. As at 18 November 2019, Legal & General has a market capitalisation of £16.7billion.
This announcement may contain certain forward-looking statements relating to Legal & General, its plans and its current goals and expectations relating to future financial condition, performance and results. By their nature, forward-looking statements involve uncertainty because they relate to future events and circumstances which are beyond Legal & General’s control, including, among others, UK domestic and global economic and business conditions, market-related risks such as fluctuations in interest rates and exchange rates, the policies and actions of regulatory and Governmental authorities, the impact of competition, the timing impact of these events and other uncertainties of future acquisitions or combinations within relevant industries. As a result, Legal & General’s actual future condition, performance and results may differ materially from the plans, goals and expectations set out in these forward-looking statements and persons reading this announcement should not place reliance on forward-looking statements. These forward-looking statements are made only as at the date on which such statements are made and Legal & General does not undertake to update forward-looking statements contained in this announcement or any other forward-looking statement it may make.