UK budget fears clouding L&G shares, says CEO

Core Viewpoint - Legal & General CEO Antonio Simoes emphasizes the need for clarity in the upcoming UK budget to avoid deterring pension savers and to stimulate investment in the UK economy [1][2]. Group 1: Tax and Investment Climate - Simoes warns that potential tax increases for savers, the wealthy, or businesses in the upcoming budget could negatively impact investment sentiment [2]. - He notes a significant pent-up demand for investment in the UK, but current uncertainty is causing potential investors to hesitate [2]. - Any tax changes that discourage pension savers would be a major concern for the UK economy [2]. Group 2: Company Strategy and Performance - Simoes acknowledges the need to better communicate Legal & General's strategy, which includes life insurance, pension, and investment products [3]. - The company aims to enhance performance in its capital-light asset management and retail units, while addressing concerns about demand for its primary profit source, pension scheme acquisitions [3]. - Legal & General has outlined growth plans for its retail unit and is on track to achieve group earnings growth at the higher end of the 6% to 9% range for the year [4]. Group 3: Market Sentiment and Economic Policies - Simoes expresses support for the government's economic policies and reforms, including easing planning laws, while highlighting the company's recent commitment of £2 billion ($2.68 billion) to British housing and infrastructure [5]. - Investor concerns regarding the UK economy are impacting Legal & General's share price, which has declined by 4% since Simoes took over as CEO [5]. - The company is seen as a proxy for the UK economy, and as a major investor in government debt, it seeks fiscal sustainability [6]. Group 4: Leadership and Future Goals - Simoes, who has a background in banking, aims to simplify Legal & General's operations and has made moves to divest non-core assets while promising higher returns [7]. - He emphasizes the importance of convincing investors of the company's growth potential, indicating that Legal & General is currently in a "show-me" phase regarding its strategy [7].