LEGAL & GENERAL yesterday unveiled record-breaking first quarter results after wealthy customers rushed to buy annuities and other savings products.
Workplace pension sales jumped an astounding 115 per cent to £202m, largely thanks to the 120,000 new customers who opened accounts as a result of new auto-enrolment rules.
The company said it expects to recruit a further 330,000 customers through the scheme by the end of 2013. New rules mean all companies will be forced to sign their workers up for a pension unless employees choose to opt out.
Strong performance in other sectors and stock market gains during the early part of 2013 meant total assets under management at the group grew nine per cent to an eye-watering £441bn.
Meanwhile, in comments that will please chancellor George Osborne, L&G said it would use spare cash to invest in infrastructure schemes such as new roads or housing projects.
“Policy makers rightly took drastic action following the credit crisis, but now face huge challenges moving from austerity to growth,” explained group chief executive Nigel Wilson.
“So, as well as progressing our own organic and acquisition growth plans, we are engaging positively with the Bank of England, Prudential Regulation Authority and Treasury as we pursue several growth options through direct investments.”
Total group sales grew 28 per cent from £434m to £555m, well above market expectations.
Analyst Barrie Cornes of Panmure Gordon praised the performance and said the company’s shares “are currently undervalued on all valuation metrics”.