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Just Group holds interim dividend payment, warns on capital

Just Group PLC said it will defer any declaration of an interim dividend for the first half as it waits for clarity on the U.K. Prudential Regulation Authority's proposed changes to rules for lifetime mortgages, which the insurer said would result in a material reduction in its capital position if implemented as outlined.

The regulator's proposed rule over lifetime mortgages being held to back annuity liabilities is open for consultation until Sept. 30, with the final outcome to depend on the result of the consultation process.

Just Group CEO Rodney Cook said he will decide on whether the company will pay a dividend or not by the end of 2018, when the regulator is due to make a decision, Reuters reported.

Cook said the insurer has already raised prices of annuities for new customers to reflect the cost of the proposed rule changes, according to the Sept. 6 report. The group has also adjusted terms and conditions of its mortgages in a move that will likely see it lend less to younger people, Cook added, noting that the changes will be industrywide.

The group reported first-half profit attributable to equity holders of the company of £48.1 million, down from £58.6 million a year earlier.