Aviva profits boosted by Friends Life integration

Aviva profits boosted by Friends Life integration

Aviva has posted increased operating profits of £3bn for 2016, up 12 per cent on the previous year.

The company’s fund management arm saw the biggest increase in profits, up 30 per cent to £138m but the bulk of the money was made in Aviva’s life business which saw profits of £2.6bn, up 8 per cent.

Chief executive Mark Wilson said the increased profit in the fund management arm reflected higher assets under management and increased revenue margin.

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Addressing the life business, he said: “In UK Life, operating profit benefitted from an additional quarter of Friends Life, delivery of integration synergies and growth in protection, pensions and individual annuities.

“This more than offset lower bulk annuity sales and reduced income from other.

“Operating profit from our European life businesses increased as supportive foreign exchange translation and growth in protection income offset the adverse effect of volatile financial markets in France and a regulatory asset levy in Poland.”

Mr Wilson said the integration of Friends Life, bought in 2015, was now complete and the company had now delivered £270m of “synergies”.

The provider reported it was investing heavily in digital infrastructure, with operating expenses of £3.4bn increased by 12 per cent on the previous year.

Mr Wilson said 15 million of Aviva’s customers were connected to a single database, with registrations doubling to five million.

He said: “The next phase of our digital journey in the UK will focus on increasing the number of multi-product customers and increasing engagement with the Friends Life customer base.”