Legal & General on track for record profits

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Insurer Legal & General has said it is on course for a record year of profits, driven by what it called “formidable momentum” in its core business divisions.

The group pointed to areas such as its retirement unit, which has delivered total sales of £6.2 billion in the year to date, thanks to strong performances in the UK and US pension markets.

In retail, L&G said it has “significantly outperformed the market”, with UK individual annuity premiums up 93%, equivalent to a 14% market share.

Lifetime mortgage advances have risen 71% to £900 million in the UK and the company said that it expects the country’s ageing demographic to make the market “increasingly attractive”.

Boss Nigel Wilson said: “L&G is on track for a record year for earnings and profits.

“Our core business divisions are generating formidable momentum.”

L&G’s investment arm saw net inflows of £38.1 billion to the end of October, while L&G Capital generated £256 million of gross proceeds.

General Insurance gross written premiums are up 13% to £305 million as the firm ramps up direct-to-consumer sales.

On Wednesday the insurer offloaded its mature savings business to Swiss Re for £650 million as it looks to plough funds into “attractive growth opportunities”.

Mr Wilson added: “With yesterday’s announcement of the sale… our business is now well-positioned and focused on the products and geographies where we see optimum growth and cultural alignment.”

In August, the group posted a leap in half-year profits, helped by changes in life expectancy rates and a strong performance in its corporate division.

The FTSE 100 firm booked a 27% increase in operating profit to £988 million in the period after a “greater than expected mortality experience” allowed it to release £126 million.

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