Investment trusts now dominate our Income Portfolio. If we include our two venture capital trusts they account for 14 of our 24 holdings. We also have seven bonds, so just three individual listed businesses remain: National Grid, New York-listed New Residential Investment and Legal & General.
The last-named reported interim results on Wednesday and Questor read them with a sense of relief. Although we had not expected a dividend cut it is always, in the current climate, a possibility, as BP brought home to investors on Tuesday. In the end L&G maintained its own interim payment at last year’s level of 4.93p. What can we expect of the full-year divi?
The company said it would “set a final dividend that is prudent, consistent with our risk appetite and in line with our dividend policy”. That policy is to pay “progressive” dividends, “reflecting the group’s expected underlying business growth, including net release from operations and operating earnings”.
“Progressive” is the City’s term for “rising”, while “net release from operations” means the freeing up of money that was held back to cover contingencies such as increased longevity of those who receive annuity income from the insurer.