Aviva PLC Announces 1Q 2014 IMS

Aviva PLC Announces 1Q 2014 IMS 
LONDON, UNITED KINGDOM -- (Marketwired) -- 05/15/14 --  Aviva PLC
Interim management statement for the three months to 31 March 2014 
15 May 2014 
Aviva plc First Quarter 2014
 Interim Management Statement 
Mark Wilson, Group Chief Executive Officer, said: 
"Aviva's overall performance in the first quarter was reassuringly
calm and stable, in marked contrast to the weather and regulatory
developments. The value of new business increased by 13% - the sixth
consecutive quarter of year-on-year growth - and our book value grew
by 6%.  
"We have made further progress simplifying our portfolio of
businesses. Since our full year results in March, we have announced
disposals of our Turkish general insurance business, US asset
management boutique River Road, South Korean joint venture as well as
a significant restructure of our Italian business. 
"Aviva still faces challenges both in the external environment and
in the business as we progress our turnaround. The regulatory
environment is constantly changing and soft conditions persist in
certain general insurance lines. As a business we remain focused on
cash flow, expense efficiency and the clinical allocation of capital
to areas where we can maximise returns. There is still much to do." 

Cash flow                 -- Operating capital generation GBP 0.4 billion     
                             (1Q13: GBP 0.4 billion)                          
                          -- Continued focus on improving cash remittances  
Value of new business     -- Value of new business up 13% in constant       
                             currency to GBP 228 million(1)(1Q13: GBP 208       
                          -- Increase driven by strong performance in Europe
                             (45%(3)) and Asia (96%(3)) more than offsetting
                             UK VNB reduction (-22%)                  
Expenses                  -- Momentum on expense reduction has continued    
                             into 1Q14                                      
                          -- Restructuring expenses 67% lower at GBP  18       
                             million (1Q13: GBP 54 million)                   
Combined operating ratio  -- Combined operating ratio of 97.7% (1Q13: 95.5%)
                          -- COR impacted by increased weather claims in    
                             Canada and the UK                              
Balance sheet             -- IFRS net asset value increased 6% to 286p      
                             (FY13: 270p)   
                          -- Pro forma(4) economic capital(5) surplus GBP 7.8 
                             billion (FY13: GBP 8.3 billion)         
                          -- Reduced external debt by GBP 240 million in April

(1) Excludes Eurovita, Aseval and Malaysia.
 (2) Comparative has been
restated to reflect changes in MCEV liquidity premium valuation and
an extension of the MCEV covered business. See the basis of
preparation in note 1 to the statistical supplement for details.
On a constant currency basis.
 (4) The pro forma economic capital
surplus at 1Q14 includes the benefit of completing the Eurovita,
Turkey GI, US asset management and South Korea transactions. 
The economic capital surplus represents an estimated position. The
economic capital requirement is based on Aviva's own internal
assessment and capital management policies. The term 'economic
capital' does not imply capital as required by regulators or other
third parties.  
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