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Resilient balance sheet

Aviva posts record profits as virus adds to uncertainty

Aviva

Aviva employs thousands in Scotland

Insurance giant Aviva posted record full year profits and said it was well placed to withstand the impact of the coronavirus.

However, it warned that the outbreak had exacerbated the “significant uncertainty” at the beginning of the year. 

The company also cited the level of interest rates, investment market volatility and foreign exchange as adding to the uncertainty.

However, it said: “we have a strong and resilient balance sheet that is designed to withstand volatility”. 

The insurer and investment firm, which employs thousands in Scotland, reported a return on equity of 14.3% and 6% rise in operating profit to £3.2bn as the dividend was lifted by 3% to 30.9 pence per share.

Pre-tax profits on an IFRS basis rose to £3.37bn from £2.12bn. Aviva said general insurance sales rose 2% to £9.3bn, adding that the outlook was positive in the majority of its markets.

“In our major life businesses, we have increased customer net inflows and grown assets by 9% to £417bn. Aviva Investors secured third party net inflows of £2.3bn on the back of strong investment performance,” the company said.

“So far 2020 has brought significant uncertainty, compounded by COVID-19, in relation to macro trends including the level of interest rates, investment market volatility and foreign exchange.

“However, we have a strong and resilient balance sheet that is designed to withstand volatility.”

Chief executive Maurice Tulloch added: “My objective is to run Aviva better. We will improve business performance and enhance returns through disciplined action on expenses and underwriting.

“We will focus capital and resources where we can achieve competitive advantage and strong returns and we will take robust action across the portfolio where our performance falls short or where we can see a better way of delivering value to our shareholders.”



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