Legal & General lifts dividend by a fifth

The dividend had already doubled in size since 2010, with UBS earlier forecasting that growth in the distributions would have to slow to 6% a year between 2016 and 2019.

Net cash generation at the FTSE 100 firm was also up, by 14% to £1.26bn, with operating profit up 14% to £1.46bn. Profit after tax rose 10% to £1.09bn.

Legal & General reported adjusted earnings per share of 18.58p, up 11% on 2014.

The firm also reported its position under the Solvency II rules, where it had a surplus of £5.5bn and a coverage ratio of 169%. It also had an economic capital surplus of £7.6bn, and a coverage ratio there of 230%.

"Legal & General delivered excellent growth in cash, profits and dividends in 2015: net cash generation and operating profit were both up by 14%, EPS was up 11 % and we are increasing the dividend by 19%," said group chief executive Nigel Wilson.

"Over the last 4 years we have delivered sustained growth, net cash has increased 10%, EPS has increased 11% and the dividend increased by 20% on average each year," he added.

Wilson said the company had already moved to a 'capital-lite' model for its UK pension risk transfer business in anticipation of the new Solvency II regime, and would use its surplus capital under the rules to continue to deliver on strategy.

He said the company's business model remained robust, and had proved itself adept and resilient in dealing with fiscal and regulatory changes.

"We are planning for more global economic and market volatility and are well positioned for continued pressure on pricing and changes in product mix in our industry," Wilson explained.

"Our strategy is aligned to growth for our markets, meeting our customers' needs and delivering socially useful products. We remain confident in the outlook for our business," he concluded.

Legal & General's board recommended a final dividend of 9.95p per share, up from 8.35p a year earlier.