Aviva Plc · LSE:AV.
Aviva — Investor Presentation (December 2008)
100 slides from Aviva's investor presentation, December 2008
Slide 1: Investor Presentation
Investor Presentation December 2008 Andrew Moss Chief Executive “Accelerating transformational change to deliver a unified and more profitable company”
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 and results. These forward-looking statements sometimes use words such as ‘an
Slide 3: Contents
Contents Page 1 Overview 4 2 Executive management 18 3 Financial results 20 4 Financial strength 25 5 UK and Europe 33 6 North America, Asia Pacific and Aviva Investors 71 7 Contacts 99 Investor presentation December 2008 3
Slide 4: Overview
Overview i AVIVA
Slide 5: An increasingly global company
An increasingly global company £30 billion HY 2008 sales £25.5bn (1) Asia Pacific 7% 23% 10%General North America 12% Insurance UK GI 11% £15 UK Life 26% billion 77% 9% Long 21% Term Savings 36% Europe 44% 40% 33% HY 2000 HY 2008 (1) 2008 total long-term savings new business sales and G.I. and healt
Slide 6: Remaining strong through tough economic times
Remaining strong through tough economic times • Proactive management through the banking and economic crisis – Aviva has a diversified and strong asset base – Taking action to safeguard our solvency – Confident position with regard to capital and cash flow • Achieving good new business results in sp
Slide 7: A strong financial base - H1 2008 highlights
A strong financial base - H1 2008 highlights • Operating profits and dividend well ahead of last year – EEV operating profit up 12% to £1,719m – IFRS operating profit up 7% to £1,233m – Interim dividend up 10% to 13.09p • High quality assets and sound capital position – EEV net asset value per share
Slide 8: A clear strategy to deliver growth
A clear strategy to deliver growth Purpose Prosperity & peace of mind Purpose Vision One Aviva, twice the value Vision Strategic Targets priorities • Manage composite • 98% meet or beat COR portfolio • Long Term Savings • Build global Asset growth targets Management • £500m cost savings by • Allocat
Slide 9: Targets and capital allocation
Targets and capital allocation Capital utilisation for dividends and profitable growth Dividends Net capital generation Asia UK Europe N.America Pacific Operational Double Dividend ROCE targets IFRS EPS GI COR 98% meet or beat 9 9 9 Life growth targets 9 9 9 Cost savings 9 9 9 Aviva Investors 9 9 9
Slide 10: Manage the composite portfolio
Manage the composite portfolio Diversity, cash flow, resilient product range Long Term savings General Insurance Composite Investor presentation December 2008 10
Slide 11: Aviva Investors: A powerful new global asset management business
Aviva Investors A powerful new global asset management business • Globally integrated asset management business – The third pillar of our composite model, rebranded Aviva Investors – £235 billion funds*, over 1,100 staff in 21 locations across North America, the UK, Europe and Asia Pacific • Acceler
Slide 12: Increase customer reach
Increase customer reach Access to customers through preferred channels Multi-distribution Direct Sales Bancassurance Independent Agents Investor presentation December 2008 12
Slide 13: Increase customer reach: over 90 bancassurance agreements
Increase customer reach Over 90 bancassurance agreements New bancassurance partnerships in 2007 - access to over 50 million potential new customers Investor presentation December 2008 13
Slide 14: Significant change is taking place: uniting under a single brand
Significant change is taking place Uniting under a single brand – Developing the brand proposition for our customers and our employees Investor presentation December 2008 14
Slide 15: Accelerating transformational change in 2008
Accelerating transformational change in 2008 • Range of senior management appointments (European CEO, Spain, Italy, Poland) • A key priority: Our customers – Introducing a single measure of customer advocacy to track progress – Over 1 million customers benefiting from the reattribution and special b
Slide 16: Accelerating transformational change in 2008
Accelerating transformational change in 2008 • Tackling the operational cost base – Increasing the cost savings target to £500m • Of which £211m had been delivered at 30 June 2008 – Business unit initiatives: e.g. Spain: introducing “One Aviva” operationally, 10% minimum cost saving • Sharing expert
Slide 17: Growth in Life and Pensions assets by region
Growth In Life and Pensions assets by region Area of bubble = Projected increase Aviva’s presence Life & Pensions Assets CAGR (2007 - 2017) in Life & Pensions assets to 2017 Strong Latin America Growing Asia-Pacific (ex. Japan) None Africa & Middle East North America Europe Japan Life & Pensions Ass
Slide 18: Executive management
Executive management _ AVIVA
Slide 19: A highly capable and experienced executive team
A highly capable and experienced executive team Andrew Moss Chief Executive Philip Scott Tom Godlasky Chief Financial Officer North America Andrea Moneta Mark Hodges UK Life Europe Igal Mayer Simon Machell UK GI Asia Pacific Amanda Mackenzie Alain Dromer Marketing Anupam Sahay John Ainley Aviva Inve
Slide 20: Financial results
Financial results El AVIVA
Slide 21: HY 2008 key highlights
HY 2008 key highlights • Life and pensions new business sales up 11% to £17.3bn • Life new business contribution up 19% to £656m at increased margin • GI COR 97% • EEV operating profit up 12% to £1,719m • IFRS operating profit up 7% to £1,233m • Profit before tax impacted by adverse investment varia
Slide 22: A strong financial base - H1 2008 highlights
A strong financial base - H1 2008 highlights EEV basis IFRS basis 6 mths 6 mths Growth 6 mths 6 mths Growth 2008 2007 % 2008 2007 % £m £m £m £m Life operating return 1,480 1,251 18% 970 834 16% Fund management 30 45 (33)% 63 76 (17)% General insurance 538 560 (4%) 538 560 (4%) Other Other operations
Slide 23: Q3 2008 IMS update: life and pensions sales up 12%
Q3 2008 IMS update Life and pensions: sales up 12% and margin maintained New business PVNBP 1 margin2 9 months 9 months 2008 2007 Growth 9 months 6 months £m £m % 2008 2008 % % UK 8,628 8,750 (1)% 3.1% France 2,824 2,684 5% 4.2% Ireland 949 1,303 (27)% 0.8% Italy 1,752 2,362 (26)% 2.9% Netherlands 3
Slide 24: Q3 2008 IMS update: Asia Pacific life and pensions sales up 13%
Q3 2008 IMS update Asia Pacific: life and pensions sales up 13% 1 PVNBP PVNBP1 9 months 9 months 2008 2007 Growth £m £m % LIFE & PENSIONS Asia Pacific Australia 275 349 (21)% China 175 98 79% Hong Kong 188 252 (25)% India 115 86 34% Singapore 201 219 (8)% Other Asia 214 34 523% Total Life & Pensions
Slide 25: Financial strength
Financial strength B AVIVA
Slide 26: Strong and resilient balance sheet
Q3 2008 IMS update Strong and resilient balance sheet Strong and resilient balance sheet, capital and liquidity position • Net asset value per share on an EEV basis of 696p (30 June 2008: 702p) • Net asset value per share on an IFRS basis of 434p (30 June 2008: 434p) • Strong liquidity position with
Slide 27: Sound capital position: IGD solvency surplus
Sound capital position IGD Solvency surplus of £1.3 billion at 24 October 2008 Equity movement 30 June 2008 IGD 30 Sept 2008 IGD surplus of £1.8bn surplus of £1.9bn £bn £bn -10% (0.4) (0.2) -20% (0.7) (0.4) -30% (1.0) (0.5) -40% (1.3) (0.7) • Equities reflect lower market values, mitigated by furthe
Slide 28: Aviva's debt securities are prudently valued
Aviva’s debt securities are prudently valued • 94% of debt securities at 30 June 2008 are investment grade, with 1% below and 5% not rated • Debt securities held to back insurance liabilities. Short duration bonds backing GI business • On the IFRS balance sheet, all financial investments marked to m
Slide 29: High quality loan book with good track record
High quality loan book with good track record LTV LTV LTV LTV LTV LTV >100% 95- 95-100% 90- 90-95% 80- 80-90% 70- 70-80% <70% Total 30 June 2008 Non- Non-securitised mortgage loans £m 890 1,688 2,741 5,365 2,839 4,641 18,164 Total mortgage loans £m 890 1,823 4,827 8,435 3,090 6,903 25,968 3.4% 7.0%
Slide 30: Assets prudently valued - IGD position at 30 September 2008
Assets prudently valued - exposures well understood IGD position as at 30 September 2008 Total capital £17.3bn £17.3bn Net assets not in IGD £4.8bn (1) (1) Regulatory capital resources £12.5bn IFRS net IGD surplus assets £1.9bn £11.5bn IGD net assets £6.7bn 26% Capital resource requirement (2) (2) £
Slide 31: Innovative financial management
Innovative financial management 2008 update on progress • Reattribution of UK inherited estate announced • £1bn hybrid debt raised in 2008 • Downside protection for further market deterioration • Global Finance Strategy aims to deliver: – MCEV for end 2008 reporting – Economic capital for Solvency I
Slide 32: Reattribution of the inherited estate
Reattribution of the inherited estate • Timeline February 2008 £2.1bn special distribution announced July 2008 Up to £1bn policyholder incentive payment agreed in principle Summer 2009 Earliest date of reattribution • Policyholder benefits – Those who elect: • cash incentive payment of £1,000 on ave
Slide 33: UK and Europe
UK and Europe _ AVIVA
Slide 34: UK Life
UK Life y AVIVA
Slide 35: UK Life – continuing operational improvement
UK Life – continuing operational improvement EEV operating profit growth IFRS operating profit growth 1000 1000 HY1 CAGR 13 % HY1 CAGR 39 % Market 750 750 Leadership £ million £ million 500 500 ● Address legacy 250 250 ● Transform 0 0 business 2005 2006 2007 2008 2005 2006 2007 2008 model • Will rem
Slide 36: Competitive advantage: strong brand, financial strength
Competitive advantage Strong Financial brand strength Product Multi reach distribution Investor presentation December 2008 36
Slide 37: Competitive advantage: product reach
Competitive advantage: product reach A broad product portfolio 15% • Top three position in all markets • 10.7% life & pensions market share 10% • Value from: 15% 14% • Scale 5% 9% 8% • Insight 0% • Flexibility Pensions Protection Annuities Savings = High quality earnings Market share based on half y
Slide 38: Norwich Union Life net flows
Norwich Union Life net flows Half Year 2008: £(0.3) bn Bonds and savings £(0.3)bn £0.3bn £0.3bn Pensions £(0.3)bn £0.5bn Risk Non profit With profit £(0.2)bn Business no longer £0.0bn sold (endowments) £(0.6)bn Net flows HY 2008 Non With Profit Profit Total % of £bn £bn £bn funds Bonds and savings (
Slide 39: UK Life – new business profitability
UK Life – new business profitability 5,000 7% WACC 4,500 Bonds & 4,000 Savings 2007 results: 3,500 • Composite IRR of 13% 3,000 (unleveraged) PVNBP £m 2,500 Individual • Equity shareholders IRR 2,000 Pensions Annuities of 15% (leveraged) 1,500 Group 1,000 Personal Pensions Protection Corporate 500 P
Slide 40: Creating value: sustainable low cost base (2006)
Creating value: sustainable low cost base 2006 starting point Sustainable cost model by 2009, underpinning future business development. Swiss Re partnership Outsourced nearly three million Operational review life and pension policies Previously announced benefits. Existing business impact £72m Simpl
Slide 41: Creating value: sustainable low cost base (2007)
Creating value: sustainable low cost base 2007 progress Sustainable cost model by 2009, underpinning future business development. Swiss Re partnership Outsourced nearly three million Operational review life and pension policies Previously announced benefits Simplification Existing business impact Si
Slide 42: UK Life
UK Life Current position HY 2008 Performance • A leading UK Life company, with 10.7% life and • Record life and pensions sales, up 1% to £5,863m consolidating pensions market share at H1 2008 (H107: 10.6%) cumulative 39% growth in last two financial years • Broad Product reach, top three position in
Slide 43: UK General Insurance
UK General Insurance | ft AVIVA
Slide 44: UK General Insurance – delivering transformational change
UK General Insurance – delivering transformational change The external environment remains competitive • Rating environment will improve in the current economic Market environment Leadership • Commercial rates now in positive territory • Inflationary pressures receding ● Address legacy ● Transform b
Slide 45: UK General Insurance - expense management
UK General Insurance - expense management Inflation and (38) one-off Costs11 (125+) (200) Market Leadership Expense ratio 13.9% ● Address legacy Expense ratio ● Transform 12.4% Aiming for an business expense ratio of model less than 11% 3 Starting RAC 2 2006 C&E Prog. 1 2008 point integration saving
Slide 46: The UK market leader
Insurance Excellence in UK GI: 'Focus on Profit' The UK market leader Aviva Rest of Market 14.4% • Consolidated market – top 6 insurers 37.6% have over 50% market share RBSI (including Direct Line) 12.3% • Aviva is the largest GI insurer in UK RSA • Top 1 or 2 position in all our major 8.5% classes
Slide 47: Unparalleled customer reach
Insurance Excellence in UK GI: 'Focus on Profit' Unparalleled customer reach DIRECT BROKERS PARTNERS Banking Retail Affinity 3,000 brokers #1 in the SME market Powerful brands … over 100 others Insurer of the year 2003 to 2007 Investor presentation December 2008 47
Slide 48: NUI's strategic priorities
Insurance Excellence in UK GI: 'Focus on Profit' NUI’s 7 strategic priorities Win the Customer Win the Broker • NUD relaunch • War for distribution • RAC membership • Partnerships moments of truth Building Core Insurance Capability Claims Inflation Busting • Sophisticated pricing • Sustainable benef
Slide 49: Summary – our business
Insurance Excellence in UK GI: 'Focus on Profit' Summary – our business Revenue Personal Lines £5.4bn NWP • Marketplace Commercial – 36% - Aggregators have grown significantly - Panel operators becoming potential adversaries - On-line growing • We have a clear strategy - Relaunch of Direct and RAC P
Slide 50: Reshaping the book
Insurance Excellence in UK GI: 'Focus on Profit' Reshaping the book We are leveraging our unparalleled access to customers and reshaping the front end of our business Direct Relaunch Panel Proposition Leverage Reshaping the Membership book.. Consolidators Reduce premium Sustainable commission Strong
Slide 51: Reshaping the book
Insurance Excellence in UK GI: 'Focus on Profit' Reshaping the book By 2011 our personal lines book will have changed… • Direct grows • Brokers grow • Partnerships fall • RAC steady in Rescue but doubles in size for insurance • Motor grows • Home grows • Creditor falls Investor presentation December
Slide 52: Building core insurance capability
Insurance Excellence in UK GI: 'Focus on Profit' Building core insurance capability Personal Lines - Transforming Pricing 0.12 0.1 Buildings & Contents Gold Cover Silver Cover Bronze Cover Old Rating 0.08 Sums Insured 3 3 3 Make Percentage of Policies Blanket Blanket Blanket Specified Inner Limits 3
Slide 53: Delivering the promise of scale
Insurance Excellence in UK GI: 'Focus on Profit' Delivering the promise of scale Self Service Centres of Excellence Operational & IT excellence to deliver sub 11% expense ratio 2007 2010 c900 Applications <300 Applications Mass Customisation & Lean Manufacturing IT Roadmap Sustainable service excell
Slide 54: Delivering the promise of scale: expense benchmarks
Insurance Excellence in UK GI: 'Focus on Profit' Delivering the promise of scale NUI UK Best of Best of 2 Expenses Breed Breed Co. Personal Lines Motor 16.1% 12.3% Direct Line, Fortis Property 11.0% 9.7% Direct Line, NU 2006 Creditor 1.3% 1.3% NU UK 1best of breed expense RAC Rescue 27.5% 27.5% NU r
Slide 55: Delivering the promise of scale: cost reduction targets
Insurance Excellence in UK GI: 'Focus on Profit' Delivering the promise of scale Phase 1 Target : £200m • Sales & Marketing One- C&E offs £38m • IT • Support Services Inflation • Change Phase 1 Cost Reduction Phase 2 Target : £150m • Operations • IT One- offs Phase 1 Cost Phase 2 Reduction 09 & 10 P
Slide 56: Financial impacts
Insurance Excellence in UK GI: 'Focus on Profit' Financial impacts Reshaping the book • Sacrifice volume for profit • Sustainable distribution ratio Building core insurance capability • Rating at or above inflation & cleanse the book • Sophisticated pricing • Inflation busting Delivering the promise
Slide 57: UK General insurance
UK General insurance Current position Performance HY 2008 • Market leading position, with a 14% market share • General insurance & health operating profit of £305m • Multi product and multi channel distribution • General insurance COR of 98% (2007: 102%) • Pricing and underwriting discipline • Gener
Slide 58: Aviva Europe
Aviva Europe El AVIVA
Slide 59: Europe – capitalising on a market leading position
Europe – capitalising on a market leading position NBC post cost of capital growth EEV Operating profit HY1 CAGR 13% HY1 CAGR 19% 500 Scale, growth, 400 1500 capital £ million 1250 300 1000 £ million 200 750 • Seize unique 500 growth 100 250 opportunities 0 0 2005 2006 2007 2008 2005 2006 2007 2008
Slide 60: A strong life business and a focussed GI presence
A strong life business and a focussed GI presence Spain Italy Czech 3rd (L&P) 6th (L&P), 13th (GI) 13th (Life) Poland Romania Russia* 2nd (Life), 1st (Pen), 20th (GI) 5th Pillar II Pensions, 5th Life 20th (L&P) Turkey** France 3rd (Life), 1st (Pen),14th (GI) 9th (L&P), 15th (GI) Ireland 3rd (L&P), 1
Slide 61: Strong top line growth
Strong top line growth….. PVNBP (Life & Pensions)* Total sales £m £m CAGR 20,000 20,000 1% £19,719 A GR +1 20% C £17,018 2% £14,914 £15,581 3% R +1 15,000 15,000 C A G £13,613 £12,840 £11,801 £12,095 12% £10,355 £10,358 £10,332 +15% 10,000 £9,021 10,000 £7,778 +9% £7,405 +14% +15% 5,000 5,000 +16% +
Slide 62: Platform for growth
Platform for growth • A unique platform for growth – Life and pensions HY08 sales up 15% – New business margin after the effect of required capital improved to 2.9% – IFRS life operating profits up 23% to £486 million in first half of 2008 • A CEE portfolio positioned for growth Czech 13th (Life) Ru
Slide 63: Diversified distribution in Europe
Diversified distribution in Europe Evolution of Sales through Bancassurance 2007 L&P sales by channel Percentage of total L&P sales 50% Distribution 51% 25% network 45% 48% 51% 44% 24% aligned to 40% the customer 39% Independent Agents/Brokers 35% Tied Agents/Direct 2004 2005 2006 2007 2004 percenta
Slide 64: France
France Current position HY 2008 Performance • Life: top 10 position in the market (5% UL market share) • Total PVNBP sales of £2.0bn (2007: £1.8bn) in a • Award winning fund performance with 81% of managed declining market funds in the top half for returns over 5 years • New business contribution (g
Slide 65: Netherlands
Netherlands Current position HY 2008 Performance • Top 5 position in the Netherlands for new business; also • PVNBP life and pensions sales were higher at £2.0bn operations in Belgium and Germany (2007: £1.1bn) including 3 group pension contracts • Multi-channel, multi-label distribution selling tot
Slide 66: Ireland
Ireland Current position HY 2008 Performance • Largest composite insurer in Ireland • Sales (PVNBP basis) down 27% to £648m as stock market • Combined Hibernian/Ark business ranks 3rd in life and volatility, economic uncertainty and slowdown in property pensions market with 17% market share, and 1st
Slide 67: Italy
Italy Current position HY 2008 Performance • PVNBP sales down 30% to £1.3bn reflecting difficult • 6th position in the market with a strong bancassurance market conditions and timing of marketing campaigns presence • New business margin of 2.9% (2007: 2.7%) • Market leading expense ratio through eff
Slide 68: Spain
Spain Current position HY 2008 Performance • 3rd position in the market with a strong bancassurance • PVNBP sales of £1.3bn (2007: £1.1bn) presence • New business contribution (g/g) increased to £133m, with a margin of 10.6% (2007: 7.9%) reflecting contribution of • 7% market share Cajamurcia risk p
Slide 69: Poland
Poland Current position HY 2008 Performance • Leading long-term savings group following greenfield • Strong life and pensions sales growth to £739m (2007: launch in 1992 £379m) reflecting bancassurance sales and new • Currently 2nd in the life market and 1st in the pension regular premium product ma
Slide 70: Central & Eastern Europe
Central & Eastern Europe Current position HY 2008 Performance • Merger with Turkish life and pensions business AK • Total PVNBP sales increased 191% to £509m (2007: Emeklilik completed in November 2007 and concluded £175m) mainly due to pensions business in Romania and long term bancassurance agreem
Slide 71: North America, Asia Pacific and Aviva Investors
North America, Asia Pacific and Aviva Investors
Slide 72: Aviva North America
Aviva North America | AVIVA
Slide 73: North America - USA set to double new business scale
North America - USA set to double new business scale a year ahead of target Pro-Forma PVNBP Growth EEV operating profit 8000 1000 HY1 CAGR 28% HY1 CAGR 52% Double scale 6000 750 US$ million US$ million 4000 • Focus: top 5 in 500 chosen 2000 250 segments 0 0 2005 2006 2007 H1 08 2006 2007 2008 • Expa
Slide 74: Aviva USA - expect to double sales while maintaining margins
Aviva USA - expect to double sales within 2 years, while maintaining margins, one year ahead of target Pro-Forma Half Yearly PVNBP Growth 4,000 Q308: sales grew by 39% with third consecutive quarter of record volumes 3,000 $ millions H108: 28% growth in sales for Aviva 2,000 USA, building upon impre
Slide 75: Product innovation from multiple angles
Product innovation from multiple angles Customer Value Customer Protection • Growth • Guarantees potential • Liquidity • New services Product Innovation Marketing Shareholder • Agent recruiting • Profitability management • Brand enhancement • Risk controls • Product differentiation • Business model
Slide 76: Distribution management
Distribution management 2007 Combined Life and Annuity Sales* By channel Bank Structures 10% 1% Opportunities: CMO & PPGA 5% • Expand existing distribution platform • Develop new channels • Banks • Brokerages • Independent broker dealers IMO IMO – Independent Marketing Organizations 84% CMO – Career
Slide 77: USA
USA Current position H1 2008 Performance • Expect to double sales while maintaining margins within • Total PVNBP sales up 28% to £2.2bn (2007: £1.7bn) two years of acquisition of former AmerUs business, one year ahead of target • Total new business contribution (g/g) £92m (2007: £57m), up 61% • Sale
Slide 78: Canada
Canada • Ranked 2, with 9% market share • Seeking to increase market share by organic growth and the creation of alternative distribution channels • Leveraging scale economies through common infrastructure and centralised core functions • Delivering innovative value added propositions via distributi
Slide 79: Aviva Asia Pacific
Aviva Asia Pacific | AVIVA
Slide 80: Asia Pacific – a growing presence
Asia Pacific – a growing presence Growth in Asia Pacific PVNBP EEV Operating Profit 1500 HY1 CAGR 14% Scale, growth HY1 CAGR 33% 100 75 £ million 1000 £ million • Prioritised 50 portfolio 500 25 • Regional 0 0 2005 2006 2007 2008 2005 2006 2007 2008 operating model • Investment • Second largest fore
Slide 81: Accelerating the delivery in China
Accelerating the delivery in China Foreign Life Insurers Market Share for period from China PVNBP Jan - Sep 2008 (by total premium)1 AIA 20% 200 Others HY1 CAGR 99% 36% AVIVA-COFCO £ million 11% 100 CITIC-Prudential 10% Hengan-Standard Life 5% Generali China 0 ING-Capital 6% 2005 2006 2007 2008 5% A
Slide 82: Aviva Asia Pacific: Footprint at a glance
Aviva Asia Pacific Footprint at a glance China Taiwan Joint venture: 50:50 First-Aviva Aviva Cofco,100% Life Joint venture: 49:51 India Hong Kong Joint venture: 26:74 with Life Dabur Group 100% Aviva owned 100% Life Malaysia Singapore Joint venture: 49:51 Life, Navigator CIMB Life Assurance & 100% A
Slide 83: Background
Background • Regional markets not homogenous • Rapid speed of change in the developing markets • Massive demographic potential • Bancassurance increasing in importance in most markets • General move to transparency in developed markets • Current market turmoil adversely impact investor confidence •
Slide 84: Building success in Asia Pacific
Building success in Asia Pacific Strategic focus Competitive advantage Prioritised portfolio Bancassurance is a key differentiator • Existing markets: Key to long-term success: • Continue to optimise existing relationships China and India • Follow partners’ growth • Developing businesses in Taiwan,
Slide 85: Australia
Australia Current position H1 2008 Performance • Ranked 7th for new business in the individual protection • Total life and pensions sales down by 15%, underlying market with a growing market share. sales* grew by 16%. • Navigator, one of Australia’s largest wealth management • New business contribut
Slide 86: Singapore, Hong Kong, Malaysia, Taiwan, South Korea
Singapore Hong Kong Taiwan Malaysia South Korea Current position H1 2008 performance • Ranked 4th in Singapore1 and 17th in Hong Kong • Singapore – life and pensions sales grew by 8%. Underlying • Distribution deal with DBS - leading bank in South East sales down by 1% Asia with almost 5 million cus
Slide 87: China
China Current position • Aviva-COFCO Life Insurance (50% Aviva share) launched 1 January 2003 • Presence in 36 cities, with branches in 9 provinces/municipal cities and sales offices in a further 27 cities • Ranked 2nd among foreign insurers in terms of total Shenyang premium income Beijing BaoDing
Slide 88: India and Sri Lanka
India and Sri Lanka Current position H1 2008 performance • JV partnership (26% Aviva share) with Dabur Group • PVNBP in India up 67% to £95m (Aviva’s 26% share) launched June 2002 • PVNBP in Sri Lanka of £7m • Private companies’ market share has increased from PVNBP £m Sri Lanka 130 2% in 2001/2 to
Slide 89: Aviva Investors
Aviva Investors ft AVIVA
Slide 90: Aviva Investors – executing the strategy
Aviva Investors – executing the strategy IFRS operating profit 125 Aviva Investors 100 £million 75 • Globally 50 integrated 25 business 0 2005 2006 2007 2008 • Transform the investment model • Successful re-branding of “Aviva Investors” • UK investment portfolios restructured into alpha/beta portfol
Slide 91: Aviva Investors today
Aviva Investors today AUM by geography AUM by asset class AUM by client Poland 1.4% Australia 1.9% Spain 0.4% Other 3% Fixed income Intermediary 5% Ireland 3.2% Cash 10% 49% Institutional US 8.4% Real estate 13% 12% France 27.2% UK 57.5% Equities 26% Internal 82% £235 billion in assets under managem
Slide 92: Aviva Investors today: profits
Aviva Investors today Proportion of Aviva Investors to Group IFRS profits 3,000 FY H1 H1 Operating profit £m 2007 2007 2008 Aviva Investors 2,500 6.6% Profits in £ millions UK 70 33 28 Europe 43 21 19 2,000 North America 27 11 13 Asia 7 3 1 1,500 4.9% 5.9% Total 147 68 61 1,000 Cost: income ratio 62
Slide 93: One Aviva Investors, doubling contribution to the group
One Aviva Investors, doubling contribution to the group Single, global, integrated asset manager Aspiration to increase operating ‘One Aviva, profit four times by twice the value’ 2012 Investing for growth Investor presentation December 2008 93
Slide 94: Unbundling our portfolios to exploit market trends
Unbundling our portfolios to exploit market trends Creating more externally marketable products by unbundling Aligning capabilities to the evolving market traditional core mandates for our clients AUM by Product Type Single Market Impact to 2011E AUM by Product Type Aviva Aviva Investors vs Current
Slide 95: Flexible component toolkit to meet client requirements
Flexible component toolkit to meet client requirements RealEstate Real Estate HighAlpha High Alpha–– Indexing Indexing Asia Asia HighAlpha High Alpha–– London London Asset Asset Solutions Building allocation allocation Capability HighAlpha High Alpha–– NorthAmerica North America Structured Structure
Slide 96: Deeper penetration in mature markets; entry in high growth markets
Deeper penetration in mature markets; entry in high growth markets 2012 market portfolio Romania Bubble size High represents Aviva Investors forecast Poland revenues in China Market growth 2007-2012 (%) 2012 (£m). Middle East India Singapore Italy Ireland Nordic Australia North America UK Spain Fran
Slide 97: Investment administration
Rationalised systems, streamlined operational model Research Decision support Portfolio risk Client services and construction management Full portfolio view Client reporting Portfolio Performance Fund performance Query management Rebalancing Pre - trade Attribution Relationship management Order plac
Slide 98: Positioned for growth
Positioned for growth Achieved to date: 9 Built the executive team 9 Re-branded globally 9 Reshaped the investment portfolios 9 Have developed some global capabilities Work in progress: 9 Continuing to improve investment performance 9 Recruiting investment professionals 9 Strengthening our solutions
Slide 99: Contacts
Contacts B AVIVA
Slide 100: Further contacts
Further contacts Aviva Investor Relations Aviva Media Relations www.aviva.com/investors www.aviva.com/media Charles Barrows Hayley Stimpson Media Relations Director Investor Relations Director [email protected] [email protected] Sue Winston Jessie Burrows Head of Group Media Relation