UK insurer Legal & General’s CEO Wilson to retire

Legal & General (LGEN.L) Chief Executive Nigel Wilson is retiring after more than a decade in the top job but will remain in the post until a successor takes the helm, the British insurer and pensions provider said on Monday.

The changing of the guard at the helm of one of Britain’s largest insurers by assets and market capitalization follows a tenure marked by big regulatory changes, Brexit, the COVID-19 pandemic and the war in Ukraine.

Wilson was appointed CEO in 2012 after joining as L&G group chief financial officer in 2009 and is currently one of the longest sitting CEOs in the FTSE 100 companies. A prominent figure in London’s financial centre and adviser to successive governments, he was knighted last year.

Under his watch, profit and shares more than doubled, but in his own words, the business of becoming “truly” global remains unfinished.

“I started, but other people will take that on,” he told the head of L&G human resources in an online video.

L&G shares were down 2.5%, greater than a 0.1% fall in the blue-chip FTSE 100 index.

Wilson has “been a strong and excellent CEO” overseeing growth and restructuring, JPMorgan analysts said in a note.

“We would expect an initial negative reaction to this announcement,” they added.

Wilson has agreed to continue as chief executive until a new CEO starts and will support a smooth transition following the appointment, the company said.

It said it would now begin looking internally and externally for a successor.

“It is envisaged that this process will take around a year,” a company statement said. “In the meantime, Sir Nigel will continue to focus on delivering the current strategy of the group, supported by the executive team.”

Abid Hussain, analyst at Panmure Gordon, said the potential year-long search for a successor suggested L&G may prefer to look externally “given the desire to replace a strong personality with another that could come close, especially given the group’s international ambitions over the long term”.

Analysts with KBW, which upgraded the company last year, noted that Wilson simplified the company over the years and now has a “coherent, focused product strategy, so we do not see major changes here”.

As CFO, Wilson was credited with refocusing L&G on cash generation in response to investor gripes that life insurers were opaque and capital-hungry, a strategy that was then adopted across the industry.

The insurer is one of the largest investors in the UK stock market.

L&G also said on Monday that its guidance on full-year operating profit for last year remains unchanged and that it expects an operational surplus of 1.8 billion pounds ($2.23 billion). ($1 = 0.8071 pounds)

Original Article here: https://www.reuters.com/business/finance/uk-insurer-legal-general-says-ceo-wilson-retire-2023-01-30/

Author: Reuters

Abid Hussain

Director, Research Analyst, Insurance