Profits up at L&G

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Legal & General has reported a 23% rise in pre-tax profits for the first half of 2016 to £826 million.

Insurance operating profit fell by £48m to £138m, which L&G said was primarily due to around £40m lower than expected release from the UK protection back book, adverse mortality experience of £18m, mainly in the group protection business, and the introduction of the annual Flood Re levy for the general insurance business of £9m, the cost of which was ‘expensed’ in H1 2016.

Nigel Wilson, group chief executive, said: “We have continued to execute our strategy well. Shareholders’ profit before tax grew 23% to £826m, adjusted EPS grew 14% to 11.2p, net cash generation grew by 16% to £727m and the Group delivered a 20% RoE. We have a strong balance sheet, which gives us the flexibility and capacity to invest in support of each of our businesses.

“There are many different views of the outlook for economic growth, the state of financial markets and political uncertainty. We reflect this in our approach to risk management. While we cannot be immune to this uncertainty, we remain confident that we will continue to deliver attractive returns for shareholders, great value to customers and better outcomes for society.

“Our five long-term growth drivers, ageing populations, globalisation of asset markets, creating real assets, welfare reform and digital remain unaffected and will continue to provide many growth opportunities.”

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