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RNS Number : 0724N  Legal & General Group Plc  17 June 2025

L&G Investor Deep Dive: Asset Management

 

Legal & General Plc ("L&G" or the "Group") will today hold an Investor
deep-dive on Asset Management - the second in a series of three deep dives on
its core businesses. The event will start at 1.00pm BST and will be webcast
here (https://group.legalandgeneral.com/en/investors/) . Presentation slides
will be available online shortly beforehand (at the same link).

 

Today's presentation will set out why our Asset Management business is
well-positioned for profitable, sustainable growth, and our strategy and plans
to address this opportunity.

 

Asset Management: a core growth engine with untapped potential and clear
direction

 

L&G's Asset Management business is a core growth engine for the Group and
supports our ambition to become more capital-light over time.

 

Demand for retirement solutions is growing globally. As a market leader in UK
Defined Benefit (DB) and Defined Contribution (DC), and the UK's largest asset
manager with a growing international presence, we are well-positioned to
capitalise on this opportunity.

 

The scale and breadth of our investment expertise and client relationships
provide strong foundations for expansion into new client channels and
geographies. We are also externalising existing asset origination capabilities
that have supported investment solutions for our own balance sheet for many
years. We will expand our client proposition, providing more sophisticated
investment solutions that address evolving client needs beyond our traditional
institutional heritage.

 

As we deepen and broaden our public and private market expertise, our platform
will deliver sophisticated solutions at scale. To achieve this, we will
optimise our core LDI, Index and Multi-Asset offerings, the critical building
blocks for investment solutions, and we will scale key areas of Private
Markets and Active Fixed Income, attracting higher margins.

 

We will leverage the power of L&G to underpin this growth through our
synergistic business model:

 ·             Our balance sheet (FY 2024: £98bn 1 ) is a permanent, catalytic source of
               capital, enabling the incubation and scaling of new strategies and increasing
               our fee-related earnings.
 ·             Asset Management supports DB schemes on the path to PRT; those retained by the
               Group as clients after buyout generate 3X higher fees.
 ·             Our Retail Workplace Savings business produces a reliable flow of net new
               assets into Asset Management, and has significant growth potential as the DC
               market matures.

 

Strong conviction in 2028 targets

 

 ·             We will deliver £500-600m operating profit (6-10% CAGR 2024-28) through a
               combination of fee earnings growth (9-15% CAGR 2024-28) and cost discipline.
               By 2028, 70-75% of Asset Management earnings will be fee-related, and our cost
               income ratio will reduce to below 70%.
 ·             We will achieve £100-150m of cumulative ANNR (2025-28) as we shift to higher
               revenue margins and target high growth client channels. We expect flows from
               our Workplace DC and annuity businesses to deliver more than half of new
               revenues, more than offsetting the structural decline of UK DB. We anticipate
               an improvement in average fee margin to double digits by 2028 (FY 2024: 8bps).
 ·             We will grow Private Markets AUM to £85bn+ by 2028 (FY24: £57bn; FY23:
               £48bn).

 

Group outlook

We have made a good start to 2025 and are on track to deliver results in line
with our 3-year targets, therefore we expect growth in 2025 Group core
operating EPS of between 6-9%.

 

Notes to editors

 

About L&G

 

Established in 1836, L&G is one of the UK's leading financial services
groups and a major global investor, with £1.1 trillion in total assets under
management (as at FY24) of which c. 44% (c. £0.5 trillion) is international.

We have a highly synergistic business model, which continues to drive strong
returns. We are a leading player in Institutional Retirement, in Retail
Savings and Protection, and in Asset Management through both public and
private markets. Across the Group, we are committed to responsible investing
and dedicated to serving the long-term savings and investment needs of
customers and society.

 

Enquiries

 

Investors

Michelle Moore, Group Strategy & Investor Relations Director

investor.relations@group.landg.com (mailto:investor.relations@group.landg.com)

+44 203 124 3773

 

Gregory Franck, Investor Relations Director

investor.relations@group.landg.com (mailto:investor.relations@group.landg.com)

+44 203 124 4415

 

Media

Natalie Whitty, Group Corporate Affairs Director

Natalie.whitty@group.landg.com (mailto:Natalie.whitty@group.landg.com)

+44 738 443 5692

Lauren Kemp, Group Head of Corporate Media & Issues

Lauren.Kemp@lgim.com (mailto:Lauren.Kemp@lgim.com)

+44 794 651 4627

 

Lucy Legh / Nigel Prideaux, Headland Consultancy

LandG@headlandconsultancy.com (mailto:LandG@headlandconsultancy.com)

+44 20 3805 4822

 1  This includes our annuity portfolio of £92bn (covering Institutional
Retirement and Retail annuities), shareholder assets of £5bn and Asset
Management balance sheet investments of £1.2bn.

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