Latest news with #AntónioSimões
New Straits Times
14-05-2025
- Business
- New Straits Times
British pension funds pledge US$66bil boost for private assets
LONDON: Major British pension funds pledged on Tuesday to pump up to 50 billion pounds (US$66 billion) of additional investment into UK businesses and infrastructure, as the government leans on private capital to fund public projects and boost growth. Seventeen investment firms, including Aviva, Legal & General and M&G, said they would invest up to 10 per cent of their pension portfolios in infrastructure, property and private equity by 2030, according to a government statement. Half will be ringfenced for UK assets. Tens of millions of workplace pension scheme members will now see more of their savings invested in higher-risk, potentially higher-reward assets like early-stage businesses and green energy, alongside stocks and bonds. Ordinary savers and their pension fund managers will compete head to head with private equity and specialist investment firms in a market investment data firm Preqin estimates will exceed US$30 trillion by 2030. Chancellor of the Exchequer Rachel Reeves said in a statement the "bold step" by Britain's biggest pension funds would deliver growth and give working people greater financial security in retirement. The new Mansion House Accord doubles a 2023 target to invest 5 per cent of pension pots in productive assets and broadens the range of applicable assets. "We have long believed that UK pension savers should benefit from exposure to the higher returns provided by private markets," António Simões, Group Chief Executive Officer of L&G, said in a statement. Other participating funds include the Universities Superannuation Scheme, the National Employment Savings Trust and The People's Pension. Signatories to the accord are expected to gain improved access to the British Business Bank's pipeline of UK venture capital opportunities after the Financial Conduct Authority approved the launch of the lender's British Growth Partnership. INCENTIVES, NOT MANDATES The pledges agreed on Tuesday are currently voluntary. But the government said it would monitor progress against the commitments, which will be reinforced by further measures in an upcoming pensions review. The Financial Times and other media have reported that the government is considering forcing pension funds to invest more in UK projects, worrying some executives who argue such a move would not be in the best interests of clients. "We believe the most sustainable solution lies in creating the right incentives, not mandates," a spokesperson for one of the signatories, Phoenix, said. Britain's finance ministry was not immediately available for comment. A YouGov survey of 1,563 UK pension savers commissioned by workplace savings and pensions fintech NatWest Cushon showed 52 per cent of respondents agree that pension funds should invest more in the UK.
Telegraph
12-03-2025
- Business
- Telegraph
City must back defence industry to protect Britain, says major pension fund
Pension funds should back the weapons industry to help defend Britain, a leading industry chief has said. António Simões, the chief executive of Legal & General (L&G), said UK military companies should be considered ethical investments because countries need to defend themselves. It comes as the financial sector faces mounting scrutiny over its willingness to back British defence companies. More than 100 MPs and peers signed an open letter addressed to Britain's finance industry last week urging it to 'sweep away ill-considered anti-defence rules' that limit investments in the arms industry. On Wednesday, Mr Simões said his FTSE insurance giant had no qualms about backing the UK defence sector and regularly invested in arms companies. He said: 'There's no reason in principle why investing in defence companies cannot be consistent with responsible investing. 'Governments should promote peaceful and inclusive societies but countries also may need to defend themselves. This is a UN-type of principle. We've always said that defence companies, including UK defence companies, can be invested in.' While many fund managers invest in defence companies, a sub-sector of 'ethical' funds snub arms businesses because they manufacture weapons. However, the war in Ukraine has upended the ethical investing industry owing to the threat of Russian aggression. L&G has £4.7bn of its more than £990bn of assets in ESG funds that exclude defence – which it says is driven by requests of its clients. Mr Simões stressed that the company would follow the demands of their customers when it came to deciding where to put their money. However, he said a broader policy excluding investments in so-called 'controversial weapons' – such as anti-personnel landmines, cluster munitions and chemical weapons – would remain. 'There are defence stocks that we would not own,' he said. 'We have the controversial weapons policy where companies that are either producing controversial weapons or providing conventional arms to high-risk countries are excluded, but that's always been the case.' He weighed into the debate as L&G's full-year results showed a 6pc rise in operating profits to £1.6bn, as Mr Simões also unveiled plans to hand back £5bn to shareholders over the next three years. This includes an immediate £500m in the form of a share buyback, which has been fuelled by the sale of housebuilder Cala Homes. The company offloaded the group last year for £1.35bn to a consortium of American private equity firms. A growing number of pension deals, such as L&G buying occupational pension schemes, has also inflated profits. The company clinched a record £8.4bn worth of these deals in the UK last year.
Yahoo
07-02-2025
- Business
- Yahoo
Legal & General shares jump 8% as investors celebrate buyback and dividend bonanza!
Legal & General (LGEN) shares have surged 8.25% as I write this on Friday (7 February), and I couldn't be happier. I've been waiting a while for this moment. In fact, I was digging in for a much longer wait, so this is an early bonus. At first, I thought the FTSE 100 insurer and asset manager had published a bumper set of full-year results, but those don't land until 12 March. Instead, we got a blockbuster announcement: Legal & General is selling its US protection business to Japanese mutual insurer Meiji Yasuda for $2.3bn. In return, Meiji Yasuda will take a 5% stake in L&G. Legal & General CEO António Simões called it a 'transformative transaction' that brings both strategic and financial benefits. It's certainly transformed the Legal & General share price. It's been sluggish for years, falling 5% over 12 months and 25% over five years. That's despite a well-received update in December outlining £5bn to £6bn in Solvency II capital generation between 2025 and 2027. Back then, I wrote that 'I love my Legal & General shares even more after today's exciting update'. Now, my devotion is being reciprocated. FTSE 100 financials have struggled with stock market volatility, UK economic concerns and high interest rates. The latter made cash and bonds more attractive, but investing is cyclical, and that's changing. With the Bank of England cutting rates three times since August, and with more likely, cash and bond yields will fall. By contrast, Legal & General's dividend yield still stands at a staggering 7.8%. I've reinvested every dividend, building my stake more of the recovery. That happy day seems to be getting closer. Under today's deal, Meiji Yasuda will take over Legal & General's US protection business and gain a 20% stake in its US Pension Risk Transfer (PRT) unit. Legal & General keeps 80% through reinsurance arrangements. Legal & General plans to use £400m to fund US PRT reinsurance and – drum roll – pump a chunky £1bn into a new share buyback programme. That dwarfs the recent £200m one. The rest of the proceeds will be reinvested into the business, hopefully driving further growth. Between 2025 and 2027, Legal & General expects to return around 40% of its market cap via dividends and buybacks. Given today's £15bn cap, that's £6bn. This should also ease concerns about dividend sustainability. High yields often signal trouble, but that doesn't appear to be the case here. One sticking point is valuation. The stock looks surprisingly expensive, trading at 32 times earnings. In August, Legal & General reported a 40% drop in half-year post-tax profit to £220m. Core operating profit edged up just £5m to £849m. It's not firing on all cylinders yet. Maybe it never will. Legal & General operates in a mature, competitive market at a tricky time for the global economy. Donald Trump's trade tariffs threats and a potential UK recession risks add uncertainty. Buying today risks profit-takers pouncing. I still see the long-term case strengthening. I bought L&G three times in 2023. My shares are up just 12.5% since then (most of that today), but my total return, including dividends, is closer to 25%. No guarantees, of course. But if Legal & General delivers on its promises, today's rally could be just the start. The post Legal & General shares jump 8% as investors celebrate buyback and dividend bonanza! appeared first on The Motley Fool UK. More reading 5 Stocks For Trying To Build Wealth After 50 One Top Growth Stock from the Motley Fool Harvey Jones has positions in Legal & General Group Plc. The Motley Fool UK has no position in any of the shares mentioned. Views expressed on the companies mentioned in this article are those of the writer and therefore may differ from the official recommendations we make in our subscription services such as Share Advisor, Hidden Winners and Pro. Here at The Motley Fool we believe that considering a diverse range of insights makes us better investors. Motley Fool UK 2025 Sign in to access your portfolio
Yahoo
07-02-2025
- Business
- Yahoo
FTSE 100 Live 07 February: Legal & General surges on US deal, house prices at new high
Legal & General fired up its shares today by announcing a major deal to streamline its US operations. The tie-up with Japan's biggest mutual life insurance company is expected to bolster shareholder returns by £1 billion. Meanwhile, the UK's average house price has reached a record high just short of £300,000. Insurer surges on US deal New house price record IPO market stuck in low gear 09:58 , Graeme Evans A potential £1 billion boost for Legal & General shareholders today fired the dealmaking insurance giant to the top of a lacklustre FTSE 100 index. The planned return represents over half the proceeds of L&G's planned disposal of its US protection business to Japan's Meiji Yasuda. The $2.3 billion (£1.8 billion) transaction announced today also involves the creation of a strategic partnership in order to capitalise on opportunities in the US pension risk transfer market. The Japanese mutual life insurance company is set to take a 5% shareholding in L&G and will look to build on existing ties in asset management. The £1 billion return to shareholders is on top of the group's existing policy. This means that L&G expects to return the equivalent of 40% of its market capitalisation to shareholders over 2025-2027 through a combination of dividends and buybacks. L&G chief executive António Simões called the deal a 'transformative transaction' with significant strategic and financial benefits to the group. The move, which is expected to be completed towards the end of 2025, helped L&G's recently stuttering share price to advance by 7% or 16.3p to 255.2p. The insurer brightened a session when blue-chip investors appeared happy to sit on the sidelines ahead of this afternoon's US non-farm payrolls report. The FTSE 100 index fell 18.68 points to 8708.58, having set a record close of 8727.28 on Thursday. Other risers included airline IAG, which rallied 3.7p to 367.1p, while Vodafone shares recovered from their slide earlier this week to improve 0.7p to 68.7p. Pharma businesses GSK and AstraZeneca gave up some of the gains seen after this week's results, down 24.5p to 1455p and 178p to 11,608p respectively. In the retail sector, Marks & Spencer dropped 7.6p to 345.7p and JD Sports Fashion weakened 0.9p to 83.8p. M&S yesterday announced a number of changes to its non-food leadership team, including the appointment of former Boohoo boss John Lyttle to run the chain's clothing, home and beauty operation. The FTSE 250 index lost 0.2% or 43.88 points to 20,929.25, including a 2p drop to 110.2p for Aston Martin Lagonda and 1.3p to 73.5p for Dr Martens. International Workspace Group rose 3% or 6.1p to 182.4p after Barclays improved its stance to Overweight with a 260p price target. 08:42 , Graeme Evans The FTSE 100 index has followed yesterday's advance of 1.2% by dropping 6.64 points to 8720.64. GSK and AstraZeneca gave up some of the gains seen after this week's results, down 26p to 1453.5p and 186p to 11,600p respectively. Other blue chips under pressure included Marks & Spencer, Barclays and Rolls-Royce, with their shares down by around 0.5%. Alongside Legal & General at the top of the FTSE 100 index, easyJet rose 3p to 532.2p and Vodafone rallied 0.7p to 68.7p. Housebuilders were in demand after yesterday's interest rate cut and this morning's Halifax report showed that house prices rose 0.7% in January. Taylor Wimpey improved 0.6p to 120.5p and Persimmon lifted 4p to 1263p. 08:19 , Graeme Evans Legal & General shares have jumped 8% after the insurer announced the sale of its US protection business to Meiji Yasuda. The $2.3 billion (£1.8 billion) agreement also involves the creation of a strategic partnership to grow L&G's US Pension Risk Transfer business. The Japanese mutual life insurance company is set to take a 5% shareholding in L&G and plans to build on its existing partnership with the FTSE 100-listed company in asset management. The deal is expected to be completed towards the end of 2025. L&G added that it plans to return £1 billion to shareholders, representing more than half of the transaction proceeds. This is on top of the group's existing distribution policy, meaning L&G will return the equivalent of 40% of its market capitalisation to shareholders over 2025-2027 through a combination of dividends and buybacks. The shares rose 19.1p to 258p. Read more here 07:52 , Graeme Evans The US jobs report for January is due to be released later, with Deutsche Bank looking for a non-farm payrolls figure of 175,000. That's a decline from the nine-month high of 256,000 in December, partly as a result of the Los Angeles wildfires which occurred during the survey week. The unemployment rate should remain at 4.1%. The bank said the other important feature of the report is the annual benchmark revisions, meaning that the previous five years of payrolls are subject to change. IG Index added: 'Despite some volatility anticipated from the employment report, analysts believe it won't shift the Federal Reserve 's cautious approach, with markets pricing in a July rate cut.' 07:32 , Graeme Evans The backdrop of a record high for the FTSE 100 index has yet to inspire any change in fortunes for London's IPO market. Peel Hunt's IPO Speedometer today decelerated slightly, reflecting the lack of new issues so far this year. It said: 'We have been expecting the first quarter to be quiet for UK IPOs for some time and this has proven to be the case. '2024 showed positive, although gradual, progress in the IPO market and we expect this to continue into 2025, albeit from the second quarter onwards. We still see the market as selectively open for the right issuers.' It said a number of firms are monitoring potential windows in the second quarter, presenting the first real test of the UK IPO market in 2025. 'We expect the pipeline to show a broadening of activity, which was focused on founder-led mid cap issuers in 2024, to more private equity and corporate backed companies in 2025.' 07:12 , Graeme Evans Lender Halifax today said the UK's average property price is at a record after January's increase of 0.7% took the figure to £299,138. The monthly rise follows December's dip of 0.2%, although annual growth of 3% was the slowest rate since July. Halifax head of mortgages Amanda Bryden said: "Affordability is still a challenge for many would-be buyers, but the market's resilience is noteworthy. 'There's strong demand for new mortgages and growth in lending. With a stamp duty increase looming, some of this demand may have come from first-time buyers eager to complete transactions before the end of March.' Read more here 07:01 , Graeme Evans The FTSE 100 index is poised for a quieter session after surging as far as 8767 and setting a record close of 8727.28 on Thursday. According to IG Index, London's top flight is set to open about 27 points lower. The lacklustre opening follows a mixed session on Wall Street ahead of today's release of US non-farm payrolls figures. The Dow Jones Industrial Average fell 0.3% but the S&P 500 rose 0.4% and the Nasdaq Composite improved 0.5%. Sign in to access your portfolio
