After Legal & General Group PLC (LSE:LGEN) impressed investors with its record full-year numbers, boss Sir Nigel Wilson criticised the government for lack of support for investment in the country.
During the year, Wilson informed the board that he plans to retire, having joined the company as finance chief in 2009 and being in the chief executive role for over a decade.
The results for 2022 were ahead of market expectations, with earnings up 12% and dividends up 5% after almost £2bn of cash was generated by the life insurer.
"At a time when many households are being affected by the rising cost of living, our commitment to inclusive capitalism is more important than ever to help improve the lives of our customers, build a better society for the long-term and create value for our shareholders," he said alongside the numbers.
Ahead of next week’s spring budget, Wilson told the Evening Standard the UK needed to provide more support for businesses as it the country is "rapidly falling behind because we can’t get finance, politics and regulation moving in the same direction".
The government and insurance sector giants such as L&G have been battling the Bank of England’s regulatory arm over reforms that they suggest could unlock £100bn of investment and investor returns from loosening the rules governing insurers’ regulatory requirements.
Wilson also told the BBC that in recent years the government has "starved our economy of growth equity, and the consequence is we are a low growth, low productivity, low wage economy fraught by political infighting".
He said changes are needed and that "we need the government to step up and put rules and policies in place that allow us to invest in the real economy in the UK".
The current government - at least under the previous Prime Minister - caused some sizeable pain to the company in the past year.
L&G was at the heart of the autumn's gilt market meltdown during Liz Truss’s occupancy of Downing Street, with the company's many liability-driven investment (LDI) mandates from defined benefit (DB) pension schemes battered as the gilt market tumbled in reaction to Kwasi Kwarteng’s mini-budget.
Of the £226bn fall in the value of the Legal & General Investment Management's (LGIM) assets last year, the LDI-related business accounted for more than half the fall.
Assets in the FTSE 100 group’s Solutions arm, which focuses on LDI products for DB schemes, fell more than £119bn to £486bn, while LGIM's overall assets fell to £1.2trln from £1.4trln. That was despite inflows from clients of £47bn during the year.
"The outlook for the group looks positive, regardless of the impact of last year’s bond market rout," said fund manager Steve Clayton at Hargreaves Lansdown, with the group bringing in new assets at pace and pension funds increasingly looking to L&G to assume their liabilities in exchange for substantial premiums.
Another 5% dividend hike is planned for next year, which puts L&G on a dividend yield approaching 7.8%.
"It is rare to find businesses that can sustain that level of dividend pay-out, but in L&G’s case, the dividend is well covered by earnings and capital generation," said Clayton.
He said Wilson's departure might be an issue to concern some investors, but added that "so far, the evidence points to L&G having been built for the long haul and the high solvency position bodes well, even if markets prove rocky ahead".