Legal and General's capital buffer shrank significantly last year as the FTSE 100 insurer revalued assets, pushing its solvency ratio down to 203 per cent for 2025 from 232 per cent the previous year. This decline, below analyst expectations of 217 per cent, caused L&G's shares to fall over 5 per cent in London trading. CFO Andrew Kail attributed the drop partly to the $2.3bn sale of its US business last year, alongside efforts to 'clean up' legacy issues in asset management. The company's solvency ratio remains comfortable, though operating profits also missed targets, rising 6 per cent to £1.62bn instead of meeting consensus.

The disappointing results overshadowed the announcement of L&G's largest-ever share buyback of £1.2bn, though the PRT market faces new competition from private capital players.