Legal & General is to press ahead with a £750m dividend payment to shareholders, defying a warning from the Bank of England that insurers should consider cancelling the payouts as the coronavirus pandemic pushes the UK into recession. The FTSE 100 insurer’s shares slumped by 10% on Friday as investors predicted it would follow the lead of Britain’s largest banks, who cancelled their dividends at the behest of the Bank of England. However, after the stock market closed Legal & General confirmed it would pay a final dividend of 12.64p per share, at a cost of £753m. Over the full year, the dividend payouts will amount to more than £1bn. The Bank of England’s Prudential Regulation Authority wrote to banks on Tuesday urging them to cancel their payouts. The banks rapidly cancelled the dividends, and said they would not pay cash bonuses to executives. The regulator took a slightly softer line on insurers, saying they should “satisfy themselves that each distribution is prudent and consistent with their risk appetite”. However, a large payout by a financial firm is likely to be controversial at a time when many people in the UK are unable to work and others are facing significant hits to their income. Unlike the banks, Legal & General has not so far announced any changes to its executive pay policies in response to the crisis. Nigel Wilson, the chief executive, was paid £3.3m in 2018. European regulators have also urged companies to reconsider making the payouts. The European Insurance and Occupational Pensions Authority on Thursday said that it “urges that at the current juncture (re)insurers temporarily suspend all discretionary dividend distributions and share buybacks aimed at remunerating shareholders”. Legal & General’s statement said that its financial position “remains robust”. The statement said: “The board has carefully considered the need to act prudently in maintaining safety and soundness, and in so doing ensure that Legal & General plays its full part in supporting the real economy. It also recognises the importance of dividend income to many institutional and retail shareholders, particularly in the current environment.” Legal & General’s core business of providing life insurance has been little affected so far by the crisis, although the value of many of the assets held by its investment arm has fallen significantly in the market turmoil caused by the pandemic. The company is not intending to apply for government support for the few staff it has furloughed on full pay.