Legal & General on Tuesday sought to reassure investors over its capital position, saying it would double the reserves it sets aside for defaults on corporate bonds to £1.2bn. The statement came as the UK insurance and investment group reported a 45% decline in its capital surplus in final quarter of the year. But L&G management denied the company would have to launch a rights issue to shore up its capital base, and indicated that there would not be a dividend cut. The shares initially rose more than 10% but ended just 0.2% higher at 44½p after a 30% fall in the previous five days.

This entry was posted by Gwen Robinson on Wednesday, February 18th, 2009 at 5:35 and is filed under Capital markets. Tagged with Legal & General. Edit this entry.