Interim management statement 9 months to 30 September 2008

Andrew Moss, Aviva chief executive, commented:

“These are unprecedented times. Our share price has been affected by the huge uncertainty in financial markets, but people around the world are still saving and buying insurance from brands they trust, like Aviva.

“Aviva is strong. The net asset value per share was 696p at 30 September. We are taking an active and prudent approach to managing our capital. Greater security for our customers and shareholders has been achieved through further hedging. Investors and customers can be confident that our disclosures provide a full picture of Aviva’s financial position.

“Our life and pensions business continued to grow, with margins maintained. Bancassurance sales have held up well at a time of exceptional difficulty for the banking industry. In the US we’re set to double our new business scale a year ahead of target.

“We remain focused on our strategy of maintaining our financial strength and transforming Aviva. We will create value for our customers and shareholders by maximising the full potential of our existing businesses. This will position us for further growth, once a more stable economic environment returns.”

 

Robust performance in challenging economic conditions

• Life and pensions sales¹ up 12% to £25,673 million (up 4% on local currency basis)
• Group margin maintained at 3.8%
• Global long-term savings sales up 3% to £29,047 million (down 5% on local currency basis)
• Bancassurance sales resilient, up 3% to £6,915 million (down 7% on local currency basis)

Strong capital and liquidity position

• £1.9 billion IGD surplus as at 30 September with increased protection through hedging
• IGD surplus estimated at £1.3 billion at 24 October; a further 20% drop in equities would reduce IGD by £0.4 billion
• Significant equity derisking in 2007 and 2008
• General insurance businesses and in-force life book continue to generate significant cash and capital
• Net asset value of 696p per share on an EEV basis demonstrates underlying value of group
• Strong liquidity position with direct access to £1.6 billion of liquid assets and £2.2 billion of undrawn committed credit facilities

Gaining the benefit of composite model, geographical diversity and balanced distribution

• UK: stable performance in line with the market; growth in annuities and individual pensions
• Europe: resilient performance reflecting geographical mix and strength of euro
• North America: outstanding growth and expect to double new business scale a year ahead of target
• Asia Pacific: excellent performances in China and India
• General insurance: 98% group combined operating ratio, in line with target

Focus on delivering group strategy

• Accelerating transformational change of existing businesses to maximise potential
• Aviva Investors launched, creating a global business with £235 billion of funds under management
• Group dividend policy remains unchanged

 

 

Enquiries:

Andrew Moss	Chief executive officer, Aviva	+44 (0)20 7662 2286
Philip Scott	Chief financial officer, Aviva	+44 (0)20 7662 2683
Analysts
Charles Barrows	Investor relations director, Aviva	+44 (0)20 7662 8115
Jessie Burrows	Head of investor relations, Aviva	+44 (0)20 7662 2111
Susie Yeoh	Senior investor relations manager, Aviva	+44 (0)20 7662 2117
Media:
Hayley Stimpson	Media relations director, Aviva	+44 (0)20 7662 7544
Sue Winston	Head of group media relations, Aviva	+44 (0)20 7662 8221
Vanessa Rhodes	Senior group media relations manager, Aviva	+44 (0)20 7662 2482
Danielle Anthony	Senior group media relations manager, Aviva	+44 (0)20 7662 9511
Ed Simpkins/Conor McClafferty	Finsbury	+44 (0)20 7251 380

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