Video: Alleged trading breaches hits Aviva profits
Aviva, Surrey Street, Norwich. - Credit: © ARCHANT NORFOLK PHOTOGRAPHIC
Aviva has revealed a £132m hit to profits sparked by the alleged trading breaches of two former employees.
But chief executive Mark Wilson said the company's internal insurance cover should help them recoup 'substantial sums' in the wake of the blow, which was triggered by the 'improper allocation of trades in fixed income securities' at Aviva Investors.
The update came as it deals with £60m worth of claims from the damage caused by this year's floods and storms that have wreaked havoc across the UK.
But despite the wide-scale disruption, the company said the figure was in line with the amount it normally sets aside for weather events in January and February.
Elsewhere, the EDP Top 100 firm signalled further progress in its recovery, rebounding from a loss of £2.9bn a year ago to profits of £2.2bn in 2013.
Mr Wilson said the 'improper' trading had been 'highly irritating' but it was the type of issue you deal with when trying to turn a company around.
He said efforts to improve the insurer's performance were now 'intensifying,' as he focused the business on 'cash flow plus growth'.
Most Read
- 1 ‘Porn addict’ Norfolk doctor who secretly filmed women struck off
- 2 Rare insect spotted in Norfolk for first time in nearly 100 years
- 3 5 famous faces who were born in King's Lynn
- 4 Norwich street named one of the most beautiful in the world
- 5 Mystery of container ships at anchor off Suffolk coast solved
- 6 Norfolk fish and chip shop named one of the 10 best in the UK
- 7 Woman’s death prompts ‘significant dangers’ warning over A11 cycle races
- 8 Seven people arrested after 50 vehicles stopped by police at Thickthorn
- 9 Norfolk start-up taking on retail giant Amazon
- 10 Vandals smash charity dinosaur trail T.rex and leave kebab in its mouth
'Cash flows to the group are up 40pc, operating expenses are down 7pc, operating profit is up 6pc and value of new business is up 13pc,' he added.
'Following our exit from a number of low margin, underperforming or non-strategic businesses, Aviva is simpler, more focused and better managed. We have significantly improved our capital surplus, increased our liquidity and have a stronger leadership team.'
But he said the business was still a long way short of performing at its full potential.
'I want to guard against complacency. Aviva still has issues to address. Have we made progress? Yes, some. Is it a little faster than anticipated? Probably. Have we unlocked the full potential at Aviva? Not yet,' he added.
Aviva Investors recently revealed that it was looking to maximise the income potential of its two empty office blocks on St Stephen's Street, Norwich.
The insurer said it was open to offers in a move that could see them turned into flats, student accommodation or event a hotel.
• Do you have a business story for the EDP? Contact reporter Ben Woods on 01603 772426, or email ben.woods@archant.co.uk