Aviva grumbles
Everybody seems to have a view on how Aviva should be structured and today chief executive Andrew Moss gave his. To nobody's surprise, he thinks life insurance and general insurance sit happily under one roof as there are efficiencies in terms of capital and IT. Andy Haste, at RSA, can forget any lingering hopes of bouncing Moss into selling Aviva's non-life assets.
The interesting bit of the review, however, was the commitment to "increasing geographic focus," meaning a focus on Britain and continental Europe. What does that imply for the US, Canada, China and India? Aviva's businesses in all four countries still meet Moss's criteria for "strength and scale", but it is also clear that he might be a seller at the right price at some point. That's how the phrase "portfolio choices" decodes.
Until we see action, Aviva won't quieten the grumble that it fails to punch its weight. But if there are easy (ish) ways to turn long-term life assets into cash at attractive prices, the shares become interesting. The starting point is a dividend yield of 6.8% – embarrassingly high after last year's divi cut and a cue for management to get busy.
http://www.guardian.co.uk/business/2010/nov/02/viewpoint-aviva
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Following quickly on from the last post on Aviva, I found this little commentary from The Guardian on the situation, an interesting perspective. Also a reason why he does this for a living and I don’t.
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