Aviva Share Discussion Threads

[whatsup32] 22/9/2020 09:34

Thank you .
I too thought it was to a large extent dismissed . Surprised to see it been regurgitated.

Hopefully we get some movement on France disposal in the next two weeks followed up by update on dividend.
Tulloch refused to sell Singapore as he didn't get a good offer where as new CEO has. Had the offer price increased or was asking price dropped ?
I'm looking for short term gain here so that I can switch to another bombed out share that appears to have more upside. However for long term holders I do hope it's not a fire sale at any price .
New CEO will only have succeeded if she attains good prices for disposals and strengthens core company

[cjac39] 22/9/2020 09:02

i thought they had been tidied up anyway. i saw a model of one once and if fully optimised it provides an average ANNUAL compounded return of 60% for a persons lifetime.

[wskill] 22/9/2020 06:48

The golden ticket has been around for a long time, will be very surprised if any investor is unaware of it,just a bit of company bashing from the press.

[whatsup32] 21/9/2020 20:23

Legacy contracts ‘that allow Aviva customers to buy funds at historical prices giving instant profits’

This may be a huge issue in selling French assets . Happy to hear from our resident legal minded friends.

[jordaggy] 21/9/2020 20:12

(Bloomberg) -- Aviva Plc’s new boss Amanda Blanc is not wasting any time.

When the industry veteran unveiled her first earnings as chief executive officer last month, she vowed “decisive action” and pledged to work “at pace” to reverse a share slump. Fast forward a few weeks, and Blanc has already taken major steps to dismantle the second-biggest London-listed insurer by market value.

Aviva said Sept. 11 it will sell control of its Singapore business for S$2.7 billion ($2 billion). It is now pursuing a potential sale of its French unit, which could be valued at about 3 billion euros ($3.5 billion), according to people with knowledge of the matter.

The business could draw interest from rival insurers such as AXA SA or Allianz SE and industry consolidators like Apollo Global Management Inc.-backed Athora Holding Ltd., the people said, asking not to be identified because the information is private. Aviva is separately working with an adviser to weigh a sale of its Italian non-life insurance business, according to the people.

Aviva had already started exploring a revamp under Blanc’s predecessor. It’s been considering options for its Italian life insurance venture with UniCredit SpA, Bloomberg News reported in April. The company’s Polish unit is already attracting inbound interest and potential advisers are pitching for roles to help sell it, the people said. Its joint ventures in Turkey and India are also seen as potential divestment candidates, the people said.

Shares of Aviva are down 33% this year, giving the insurer a market value of 11 billion pounds ($14.2 billion).

Legacy Contracts

The divestments could generate billions of pounds that Aviva could return to shareholders or deploy in its core operations in the U.K., Ireland and Canada. They’re also a boon for investment bankers in a year that’s seen European mergers and acquisitions fall 23% to around $620 billion.

No final decisions have been made, and there’s no certainty Aviva will sell the units being reviewed, the people said. French media reported its disposal plans in the country earlier this month.

“Aviva is in the very early stages of developing its strategy for its continental European and Asian businesses,” the company said in a statement. Representatives for Allianz, Athora and AXA declined to comment.

Any divestment of Aviva’s French unit could be the biggest sale of an insurance operation based in the country in over a decade, data compiled by Bloomberg show. It could be a tough sale, and there may not be a single buyer for the entire operation. Some prospective suitors are concerned about liabilities from legacy contracts that allow some Aviva customers to buy a fund at historical prices, bringing instant profits, the people said.

Blanc said last month that Aviva will be selective about where it competes and will allocate capital in a disciplined manner.

“Let me be clear, if we cannot meet our strategic objectives, we will take decisive action and we will withdraw capital,” she said on a call with analysts, referring to operations outside its core markets. “Ultimately, there may be better owners for these businesses than Aviva.”

(Updates to add European deal volume in seventh paragraph)

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[whatsup32] 21/9/2020 19:07

chucko. Care to provide link

[chucko1] 21/9/2020 17:25

News from the front - CEO making warm comments about further sales of divisions etc.

[salver2] 21/9/2020 16:33

Why the strange spike about 15 mins ago.Its af if someone’s got a whiff of a deal

[cjac39] 21/9/2020 13:45

its a complicated question. in simple terms low interest rates are bad but it depends a lot on the curve not just short end rates.

in non life typically insurers raise premiums and conservatively invest in short dated highly rated bonds pending the underwriting outcome. therefore lower interest rates will mean lower returns on these bonds and less investing profit. so bad.

in life insurance mostly insurers are hedged very tightly for interest rate moves so economically it shouldnt matter too much. however there are some retail products particularly in france and italy i understand that are harder to hedge and low rates is bad.

also, now we have the joys of s2 there is something called the risk margin which is a regulatory estimate for the cost of hedging illiquid liabilities. this thing flies around with interest rates as lower rates means PVing liabs at lower rates and hence they are bigger. as this is not an economic risk its left unhedged and currently the TMTP regime allows you to revalue your TMTP to cover this.

so overall its bad but not too bad depending on the shape of the curve.

it is also bad because it can make pension DB buyouts more expensive and less affordable for schemes and hence less new business for aviva.

[1robbob] 21/9/2020 13:31

eurofox
I don't really agree
Saving £200m pa on dividend payments to lower the average coupon on Longer Term Debt will take years to have any meaningful effect on the bottom line

If they really want to they might as well take the hit and pay the penalty for early redemption....however the debt recycles fairly regularly so they will naturally
lower the debt cost

I don't apologise for being a Dividend hawk on this stock.
There is no excuse for not paying out 50% of profits as dividends.
AB has to sweat this business, it has grown fat and lazy over many years and many CEOs.

[hhhold2] 21/9/2020 13:02

Another top up, thanks MM's you mugs.

[eurofox] 21/9/2020 12:33

This interest rate thing is the reason that as long as the dividend is kept down to about 20p/share/year some of the cash that is in reserve and/or released from lower dividend payments should be used to rotate the high coupon debt from the past for ultra-low coupon long term debt for the future, thus much better supporting long-term profitability compared to what it might otherwise be.

[1robbob] 21/9/2020 11:52

cjac39 and wba1
I would be most interested in your views of the direct impact of negative interest rates on the Insurance Industry in general and Aviva in particular

I have to say the prospect of negative interest rates worries me a lot.
It would seem to me that there is far too much reliance on interest rate policy,
which is a totally blunt instrument and very possibly counter productive
Surely it would be much better to adjust Taxation and Government Spending policy

[eurofox] 21/9/2020 11:42

... what do you think?

[essentialinvestor] 21/9/2020 10:57

You actually read his posts?, seriously, really?.

[eurofox] 21/9/2020 10:36

keep trying sellpoorly

[eurofox] 21/9/2020 10:20

Core holding still intact and above average price still

[dope007] 21/9/2020 08:57

Averaged a few more in on several stocks this am, including Aviva

[action] 21/9/2020 08:41

220p to 235p

[dmdmdmdm1] 21/9/2020 08:22

What opinions are there on a good level to top up? I have been averaging down for a while now each month. Perhaps I should be biting larger chunks at these levels.

[ianood] 19/9/2020 19:34

Banks will be ok. Fees for holding cash on deposit and transaction fees on current accounts together with T/O charges for corporates.

[gary1966] 18/9/2020 20:05

Presently if the BOE want negative interest rates then they are going to have to break the law to do it as their constitution doesn’t allow it. Has to be law changes first.

[dope007] 18/9/2020 19:33

Negative rates are a disaster that no good will ever come out of for anybody. Banks will whack a ton of fees on mortgages and clobber savers. Savers by the way being the only ones with any money left!!!