Strategic Distribution Deal

Legal & General Group PLC
07 February 2007


7 February 2007


 NATIONWIDE AND LEGAL & GENERAL TO ENTER A NEW STRATEGIC DISTRIBUTION AGREEMENT


Nationwide Building Society and Legal & General have today announced that they
have entered a joint distribution agreement for the supply of life insurance,
investment and pension products.


Nationwide will sell Legal & General products via the building society's 2,000
strong team of advisers and consultants. Nationwide's sales force will remain
fully responsible for all financial planning advice offered to customers.


Legal & General has agreed to purchase Nationwide's wholly owned subsidiaries,
Nationwide Life and Nationwide Unit Trust Managers. The consideration for the
sale of the two companies will be payable in cash from Legal & General's
existing resources. Consideration will be set by reference to the financial
position of the two companies as at the date of completion using an agreed basis
of valuation.


The current value of the two companies based on the March 2006 valuation is
£285m after the extraction of £70m of capital by Nationwide in December 2006.
The final cash consideration will be determined following any extraction of
relevant surplus capital by Nationwide in advance of completion and inclusion of
profits arising in the companies from March 2006 to the completion date.


The sale is conditional on the consent of the Financial Services Authority to
the change of control of the companies and other customary conditions. It is
expected to complete in the Summer of 2007, when the distribution arrangements
are expected to be launched.


Nationwide's customers will benefit from access to a wide range of competitively
priced products from one of the UK's top financial services companies with a
well established brand and an excellent reputation.


Customers with existing life insurance, investment or pension policies will see
no change in the short term. Over time some of their plans may be migrated to
Legal & General's life, portfolio management and unit trust companies.


Employees working in the Nationwide Life and Nationwide Unit Trust Managers'
businesses will be taken on by Legal & General on their existing terms and
conditions. They will continue to work from their current offices in Swindon
town centre, which Legal & General will retain as a strategic UK operations
centre for its business going forward.


Graham Beale, Chief Executive Designate of Nationwide said: 'We have been very
successful over the past ten years in supplying our own life insurance and
investment products.  However, by entering into a distribution agreement with
Legal & General we are joining forces with one of the strongest players in the
sector. This arrangement will provide an excellent opportunity for our customers
to choose from a broader range of competitively priced products and enjoy an
enhanced service. For example, we are planning to introduce an ethical
investment fund and family life insurance policies. In addition our customers
will have the confidence of dealing with two of the strongest retail financial
services names in the UK.'


Tim Breedon, Group Chief Executive at Legal & General said: 'This strategic
alliance with Nationwide builds further on our current position as a leading
partner provider of life, pensions and investment products distributed through
the UK's network of High Street Banks and Building Societies.  It clearly
supports our corporate strategy to provide access to our extensive range of
value for money products and services to consumers in the UK, through the
broadest possible range of distribution channels. I am delighted that Nationwide
has chosen us as their strategic partner. I look forward to welcoming Nationwide
employees to Legal & General and working together to provide Nationwide's
customers with the life, pension and investment products they need.'


Legal & General enquiries to:


Investors:

Jonathan Maddock, Head of Investor Relations             020 7528 6298

Nicola Marshall, Investor Relations Manager              020 7528 6263


Media:

John Morgan, Media Relations Director                    020 7528 6213
                                                         07798 604951

Anthony Carlisle, Citigate Dewe Rogerson                 07973 611888

Ethna Lee, Head of PR (UK)                               01737 374037
                                                         07834 343484


Nationwide enquiries to:

Media:

Rosemary Callender, Senior Manager,                      01793 657134

External Affairs                                         07770 634531


Alan Oliver, Head of External Affairs                    01793 655956



Nationwide Facts & Figures:


•   Nationwide is the world's largest building society with assets of £130 
    billion.

•   The Society is represented in over 860 locations across the UK.

•   Nationwide has a financial relationship with one in four households in the 
    UK.

•   Nationwide is the UK's second largest savings provider and fourth largest 
    mortgage lender.

•   At 30 September 2006 Nationwide's range of unit trust based investment
    products held by customers had a market value of over £2.6bn (4 April 2006 -
    £2.5bn).

•   A major re-launch of protection products in May 2006 resulted in a 14% 
    increase in number of sales during the six months to 30 September 2006, with
    42,000 life policies being sold (30 September 2005 37,000 policies).

•   Nationwide Life and Nationwide Unit Trust Managers, wholly owned 
    subsidiaries of Nationwide, have provided a range of regulated investment,
    protection and pension products since 1996.

•   Nationwide Life and Nationwide Unit Trust Managers' products are sold
    through a salesforce of around 2,000 Nationwide advisers and consultants.

•   Around 270 people are employed in the business of Nationwide Life and
    Nationwide Unit Trust Managers in their operational centre in Swindon.

•   Together Nationwide Life and Nationwide Unit Trust Managers have over
    £3.5 billion funds under management.

•   Investments offered include Guaranteed Equity Bonds, Equity ISA, Unit
    Trusts, and an Equity Child Trust Fund. Investment Fund Managers:

       -      BlackRock Merrill Lynch Investment Managers: Target Return Fund 
              and High Income Fund

       -      Morley Fund Managers: Balanced Fund

       -      State Street Global Advisors: Tracker Fund

       -      Fidelity and Schroders: UK Growth Fund

•   Nationwide Life manages around £19 billion of life cover.

•   Protection policies include decreasing and level term assurance and
    critical illness cover.


Legal & General Facts and Figures:


•   Established in 1836, Legal & General Group is one of the UK's top 50
    companies in the FTSE 100 Index.

•   Legal & General Group is one of the UK's leading financial services
    companies with over 5.6 million customers.

•   Legal & General Group is responsible for investing over £230 billion
    worldwide on behalf of investors, policyholders and institutions (as at 31
    December 2006).

•   Legal & General has a strong culture focusing on value for money
    financial products, and excellent customer service.  This has been at the 
    heart of its corporate strategy for the last decade.

•   Legal & General is ranked in the top 3 in every major UK distribution
    channel.

        -     Protection Provider of the Year. (Source: Financial Adviser
              Life & Pensions Awards, April 2006.)

        -     Life Assurance Provider of the Year. (Source: Financial Adviser
              Life & Pensions Awards, April 2006.)

        -     Term Assurance Provider of the Year. (Source: Financial Adviser
              Life & Pension Awards 2006.)

        -     Tracking Provider of the Year. (Source: Pensions Management Index,
              May 2006.)

•   In 2006 Legal & General was involved in arranging £21 billion worth of
    mortgages through intermediaries, via its Mortgage Club and mortgage network
    (The Legal & General Partnership).

•   Legal & General is one of the biggest providers of index-tracking
    investments in the UK, managing over £160 billion (as at 31 December 2006).


Notes to Editors:


•   Nationwide Life will be acquired by Legal & General Assurance Society
    Limited, the transaction to be funded from shareholder assets outside of the
    Long Term Fund. Nationwide Unit Trust Managers will be acquired by Legal &
    General Retail Investments (Holdings) Limited.

•   There is no need for customers to take any action. Nationwide Life and
    Nationwide Unit Trust Managers' customers requiring further information 
    about the announcement can visit www.Nationwide.co.uk or visit a Nationwide 
    branch.   Nationwide Life and Nationwide Unit Trust Managers customers will 
    be notified in due course about any changes to product administration or 
    contact numbers.


•   The information contained in this press release is intended solely for
    journalists and should not be used by private individuals or any other 
    persons to make financial decisions.


•   Troika (UK) Ltd has advised Nationwide on this transaction.



•   Legal & General Assurance Society Limited is authorised and regulated by
    the Financial Services Authority. Registered office: Temple Court, 11 Queen
    Victoria Street, London EC4N 4TP. Registered in England No. 166055.


•   Nationwide Building Society is authorised and regulated by the Financial
    Services Authority. Registered Office: Nationwide House, Pipers Way, 
    Swindon, Wiltshire, SN38 1NW.


Ends

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