Legal & General has seen its pre-tax profit fall 80% in the first half of 2001, due to an ailing market as well as increased capital investment into new products, particularly on the UK life and pensions side.

Pre-tax profit dropped from £287m (€466.2m) in the first half of 2000 to £57m in the first half of this year. Averse market conditions and the depreciation of equity caused shareholder retained capital - equity held by the firm - to fall by £225m to -£165m from the same period last year.