Aviva Plc · LSE:AV.
Aviva — KBW Conference 2009
16 slides from Aviva's conference presentation, Dec 19, 2009
Slide 1: KBW Conference 2009
2009 KBW Conference
Slide 2: Disclaimer
Disclaimer This presentation may include oral and written “forward-looking statements” with respect to certain of Aviva’s plans and its current goals and expectations relating to its future financial condition, performance, strategic initiatives and results. These forward-looking statements sometime
Slide 3: Building a Position of Strength in a Tough Market
Building a Position of Strength in a Tough Market • Tackling the market downturn • Benefitting from the market recovery • Capitalising on the current environment 3
Slide 4: Building a Position of Strength
Building a Position of Strength Taking decisive action Purpose Open to the recovery Prosperity & Delivering peace of mind the Strategy Vision One Aviva, twice the value Creating financial flexibility Strategic Targets priorities Capitalising • Manage composite onmeetthe • 98% or beat COR • £500m cos
Slide 5: Action on the Balance Sheet
Action on the Balance Sheet IGD Solvency Surplus Significantly Strengthened £bn 4.0 (£0.1bn) £0.5bn (£0.3bn) £0.1bn £3.2bn £0.4bn 3.0 £0.2bn (£0.3bn) £0.2bn £0.5bn £2.0bn 2.0 1.0 0 IGD surplus Operating Market Dividends Issue of Issue Sale of DL Value of Increase Other IGD December profits and movem
Slide 6: Action on the Balance Sheet
Action on the Balance Sheet UK Commercial Mortgages - no defaults in H1 2009 30 June 2009 31 Dec 30 June 2008 2009 Total UK Interest service cover 1.30 1.32 Remaining UK Commercial commercial commercial loans property Average loan to value 103% 106% mortgage £8.1bn portfolio portfolio Vacancy rates
Slide 7: Action on Earnings
Action on Earnings Life and Pensions margins maintained Sales Life General and Pensions insurance Margins £18.2bn £17.5bn COR2 12 months 6 months NA/Asia 2008 % 2009 % NA/Asia £3.1bn £15 bn UK 1.7% 2.1% £3.9bn Europe Europe 2.8% 2.6% Life Europe North America 1.0% 0.5% 36% Europe Asia Pacific 2.5% 2
Slide 8: Action on Earnings
Action on Earnings General Insurance COR improved NWP £5.1bn General General Insurance insurance CORs COR2 £5 bn £4.9bn NA/Asia 6 months 12 months £0.8bn 2008 % 2009 % NA/Asia £0.9bn UK 99% 99% Europe Europe 97% 96% £1.0bn Europe Life Europe North America 99% 97% 36% DL £1.1bn £3 bn £ 0.5bn 33% Tota
Slide 9: Focussed on long term value generation
Focussed on long term value generation Strong Cost Management £2,700m (£38m) £72m (£80m) £2,622m (£118m) • Ahead of run rate £500 £148m £2,493m million cost saving targets (£75m) £2,500m (£38m) • Eliminating cost over runs and reducing operational complexity in UK Life £2,300m • Closing 13 operation
Slide 10: UK Life
UK Life Significant improvement through operational excellence • Market share increased to 12% HY1 08 HY1 09 +/- from 11% whilst also increasing margins • Management action taken on product mix, Life and Pension sales £6,010m £4,735m -21% increased pricing sophistication, reduced commissions and exp
Slide 11: UK General Insurance
UK General Insurance Transforming the business • Execution of strategy is improving the HY1 08 HY1 09 +/- quality of earnings • Actively exiting poor performing business Net written premium £2,589m £2,049m -21% • Rating increases above inflation on all COR 98% 99% +1pps major classes • Improving cur
Slide 12: Europe Excluding Delta Lloyd
Europe Excluding Delta Lloyd Strength from diversity • Strong bancassurance performance limits Local fall in life and pension sales HY1 08 HY1 09 Currency • Margins: Growth • Customer preference for lower margin products with guarantees Life and pension sales £6,979m £7,071m -9% (With Profits sales
Slide 13: Focussed on long term value generation: Investing in Customers and Brand
Focussed on long term value generation Investing in Customers and Brand
Slide 14: Creating financial flexibility
Creating financial flexibility Progress with Strategic Allocation of Capital Reattribution of the inherited estate • Up to 1 million customers will benefit • Provides £600 million of new business capital in the first 5 years with significant potential upside • More than 85% response so far with 96%
Slide 15: Building a Position of Strength in a Tough Market
Building a Position of Strength in a Tough Market • Tackling the market downturn • Benefitting from the market recovery • Capitalising on the current environment 15
Slide 16: Questions
Questions