M&G swings to a £165m loss for the first half of 2026 driven by a £325m write-down linked to the Labour government's cap on existing ground rents

FTSE 100 asset manager M&G has reported a £165m loss for the first six months of 2026, driven by a £325m write-down on the value of its ground rent assets following the Labour government's introduction of a cap on existing ground rents. M&G publicly criticised the government's policy, which significantly reduced the income value of leasehold ground rent investments held on its balance sheet. The write-down flows directly from the government's decision to cap rents that were previously uncapped contractual obligations owed by residential leaseholders, a reform with direct financial consequences for institutional investors who purchased these income streams. The loss is particularly striking for a FTSE 100 firm of M&G's scale and profile, and represents a concrete example of regulatory policy risk materialising on an institutional balance sheet. The cap has been a politically contentious measure, framing the government's leasehold reform programme as consumer protection while generating significant losses for asset managers, pension funds, and insurers that held ground rent portfolios as long-duration income assets.