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L&G sees 17% fall in profits

Legal & General’s UK life and pension profits fell by 17 per cent last year from £874m to £720m.

Worldwide operating profit on a European embedded value basis fell by 26 per cent from £1.2bn to £912m.

L&G puts this down to revised longevity assumptions as well as losses from the floods last summer.

In the UK, protection sales fell from £1.2bn to £1.1bn on a present value of new business premiums basis.

Sales of unit-linked bonds also fell from £2.6bn to £2.5bn while pension sales grew from £1.3bn to £1.7bn.

Persistency experience and assumption charges totalled a negative of £66m in 2007 compared with a negative of £27m in 2006.

Group chief executive Tim Breedon says: “Legal & General has delivered a robust set of financial results. Headline numbers are lower but taking into account the significant positive regulatory and reserving changes in 2006 and the £269m of longevity strengthening this year, the business has performed consistently over the past two years.

“The risk business remains a market leader in its field, the savings business is well positioned for future growth and Legal & General Investment Management is a proven winner.”

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