New Structure for International Businesses

RNS Number : 7868O

Legal & General Group Plc

16 October 2012

 



Press Release

16 October 2012

LEGAL & General Group Plc announces NEW structure for its international businesses.

L&G sees substantial opportunities to accelerate the growth of our international businesses using many of the capabilities and synergies from our market leading UK businesses.   We are already making progress on this strategy; LGIM now manages £34.5bn (as at 30 June 2012) for international clients and L&G America (LGA) achieved new business premiums of $66m in H1 2012, a growth rate of 27% in new business sales compared to H1 2011. International businesses contributed £134m operating profit in 2011, up 31% from 2010, and dividend remittances to Group have consequently grown.  Since 2009, LGA has paid $165m of ordinary dividends and L&G Netherlands contributed a special dividend of €35m in 2011.  As announced to the market on 25 September 2012, we continue to progress our capital efficiency programme for LGA, which to date has achieved $390m of capital relief.

The platform for our International growth has been overseen by Gareth Hoskin, who is now retiring after 18 years of service at L&G.  To build on this platform and to reinforce L&G's ability to leverage its existing expertise, the responsibility for the strategic development of our international business will be led by L&G's Executive Directors, working in partnership with local Managing Directors, from 1st November 2012.

international new structure from 1 november 2012:

John Pollock, CEO of Risk, will assume additional responsibility for L&G Netherlands and L&G France. These European subsidiaries have demonstrated the potential to grow their protection businesses and will benefit from closer alignment with our market leading UK Risk businesses as they develop further scale.  John Pollock has done an outstanding job in the UK Risk business, in individual and group protection and annuities.  This business manages a book of over £1.5bn insurance premiums together with an annuity portfolio of £29bn, and delivered £561m of IFRS operating profit in 2011.

Mark Gregory, CEO of Savings, will take responsibility for development of our Indian JV "IndiaFirst", launched in 2009 with two of the country's strongest public sector banks; Bank of Baroda and Andhra Bank.  Mark Gregory will develop this model, sharing best practice from our leading UK bancassurance franchise.  Mark has transformed the UK Savings business from a business making £7m IFRS operating profit in 2008 to one making £128m in 2011.  L&G's leading RDR ready platform solution has been selected by the UK's leading building societies, who cover between them 86% of building society customers.

International expansion is a key objective for LGIM, our investment management business.  Mark Zinkula, CEO of LGIM, is leading LGIM's expansion and in the United States, as at H1 2012, LGIMA has secured 10 mandate wins this year and has $28bn of US funds under management.  Plans to extend operations in European and Asian markets continue to make progress. 

Nigel Wilson will continue to work closely with the US team of LGA, led by Jimmy Atkins (President and CEO of LGA), and to direct the development of our emerging retail models in the Gulf and North African regions.

Commenting on the changes, Nigel Wilson, CEO, said:
"Maximising growth and shareholder value from our chosen international markets by leveraging our established capabilities is a core part of our strategy. The new structure will bring focus and alignment to the delivery of these ambitions. I would like to thank Gareth Hoskin for his role in developing a strong platform for the next phase of L&G's international growth."

Compensation Arrangements:

To reflect the increase in their direct responsibilities, the salaries of John Pollock and Mark Gregory will increase by £30,000 and £32,000 respectively meaning their base salaries will be £450,000 from 1 November 2012.
L&G aims to maintain transparent remuneration structures and we regularly review all remuneration structures, policies and reporting in light of any changes to best practice including any potentially resulting from the Department for Business, Innovation and Skills' consultation papers.

About Legal & General

Established in 1836, Legal & General is a leading provider of risk, savings and investment management products in the UK.  In the first six months of 2012, Legal & General's profits before tax (on the IFRS basis) were £525m, up 11% from the prior year.  Earnings per share were 6.96p and dividends per share were 1.96p for the period, an increase of 14% and 18%, respectively. The Group has over seven million customers in the UK for life assurance, pensions, investments and general insurance plans.  (http://investor.legalandgeneral.com/business-description.cfm)

Our investment management business, LGIM, is responsible for investing £381bn worldwide (as at 30 June 2012) on behalf of investors, policyholders and shareholders.  LGIM is one of the largest investors in the UK stock market, managing around 5% of all London listed equities.  LGIM has market leading capability in index, active fixed income and liability driven investments and (as at 30 June 2012) manages £34.5bn of assets for international clients.

Our UK Risk business insures customers' potential financial exposure from death, illness, injury or household damage, and provides retirement annuities for individuals and pension schemes.  In 2011, Risk collected £1.5bn of insurance premiums and manages an annuity portfolio of £29bn (H1 2012).

Our UK Savings business has £67bn (H1 2012) of assets under administration and provides a range of retail savings funds and savings structures to individuals and workplace clients. 

LGA writes protection products in the US market, focusing on higher sums assured policies and in 2011 had in-force premiums of approximately $836m (FY 2011).

Further details of our Group Executive Directors can be found at the following links:

Nigel Wilson (CEO of L&G Group plc);
http://investor.legalandgeneral.com/group-board.cfm?showbio=25327

John Pollock (CEO of Risk); http://investor.legalandgeneral.com/group-board.cfm?showbio=4844

Mark Gregory (CEO of Savings); (http://investor.legalandgeneral.com/group-board.cfm?showbio=23321)

Mark Zinkula (CEO of LGIM); (http://investor.legalandgeneral.com/group-board.cfm?showbio=39806)

Enquiries

Investors:

Kate Vennell                         Head of Investor Relations                                                020 3124 2150

Ian Baker                              Investor Relations Manager                                              020 3124 2047

Media:

John Godfrey                        Group Communications Director                                     020 3124 2090

Richard King                        Head of Media Relations                                                   020 3124 2095

Financial Calendar 2012/2013	Date
Q3 Interim Management Statement 2012	1 November 2012
Preliminary Results 2012	6 March 2013

Forward looking statements

This document may contain certain forward-looking statements relating to Legal & General Group, 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 acquisition or combinations within relevant industries. As a result, Legal & General Group'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 Group Plc does not undertake to update forward-looking statements contained in this document or any other forward-looking statement it may make.

 

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