L&G, Legal & General Life Insurance

Written by Paul J Davies and Mark Wembridge

Tim Breedon will retire as chief executive of Legal & General by the end of next year after 25 years at the life, pensions and investment group, including 7 years in the top role.

Mr Breedon, who ran L&G’s asset management arm before stepping up to become chief executive, played a significant role in fighting to shape the incoming European capital rules for insurers, which had posed a threat to UK annuity business and even potentially to L&G itself.

He has also fought back from the near total loss of investor confidence L&G suffered at the depths of the financial crisis, when it slashed its dividend and its shares traded as low as 23p. The shares slipped 4.6 per cent to 91.25p on Thursday although they have traded as high as 125p this year.

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L&G, which last month increased its interim dividend 25 per cent on the back of strong cash generation, said it would begin looking for a replacement “in due course”. However, analysts pointed to Nigel Wilson, chief financial officer, as the leading internal candidate.

Mr Wilson has been more bullish about the potential for L&G to pursue acquisitions, especially once the Solvency II capital rules for European insurers are finalised, while Mr Breedon has always been suspicious of M&A.

“Tim’s years as CEO have been successful in our opinion,” wrote analysts at Goldman Sachs. “He was the first CEO to focus on cash generation and he was well known for his scepticism over consolidation and M&A in life insurance.”

Duncan Russel at JPMorgan added: “Does the retirement indicate that the turnaround of [L&G] is largely complete? We think so.”

Mr Breedon, 53, is unlikely to seek another mainstream corporate position, but may focus on the charity or public affairs sectors, according to people familiar with his thinking.

He is expected to see out his time as chairman of the Association of British Insurers, where his tenure runs until next summer.

“With the company in excellent shape I feel that next year will be the right time to retire,” he said. “By giving notice of this now, the board will have ample time to plan and ensure an orderly succession.”

“Tim is and has been a first class chief executive,” said John Stewart, L&G chairman. “The company is in great shape and we are appreciative of his excellent stewardship.”

Toby Langley, an analyst at Barclays Capital, said the early announcement of Mr Breedon’s retirement would “pave the way for a smooth transition for L&G, provided of course that the board is able to announce a successor in the near term”.

“Growth in LGIM [L&G’s asset management business] is a key legacy for Mr Breedon, and a strategic differentiator.”
Original Source
Legal & General are losing a valuable team member and we await with interest who is successor will be. The number of years he has worked with Legal & General is a testament to how popular his thinking was within the financial group.

L&G life insurance review

We are the leading UK protection provider* and we offer a wide variety of excellent products and services. We review our prices every week to ensure we are able to offer customers great value for money. As recognition of this, we won the ‘Best Protection Provider - Financial Adviser Life & Pensions Awards, April 2009’. Life insurance premium starts from just £6 per month, that's only 20p a day (your actual premium will depend on your individual needs and circumstance). At Legal & General, we make continual enhancements to our site to both improve the customer journey but also the online conversion rate. With over 90% of our customers rating our overall service as good/very good or excellent, you can be assured that we will provide customers with a great service.