Aviva chief says turnaround far from complete

Insurer Aviva, which has about 2,500 staff in Scotland, has insisted its turnaround has much further to go, despite a rise in annual profits and a jump in its dividend.

Mark Wilson said the firm wanted to take the pain and move on

The group is two years into a recovery plan launched by chief executive Mark Wilson following a City revolt over its performance, and yesterday said operating profits for 2014 rose 6 per cent to £2.2 billion.

Wilson said Aviva, which is on the brink of completing a takeover of rival Friends Life in a £5.6bn deal, was repaying investors’ faith with a proposed 30 per cent hike in its final dividend to 12.25p.

However, he added: “It would be wrong to assume that our turnaround is nearing completion as we have further to travel than the distance we have come.”

Aviva’s main sites north of the Border are in Perth and Bishopbriggs, and the group is seeking £225 million of annual cost savings by the end of 2017 following its acquisition of Friends Life.

Shareholders vote on the deal on 26 March and Wilson said that Friends Life would be the catalyst for the next phase of the company’s turnaround, but admitted it was braced for a difficult period as it looks for 1,500 job losses through the combination of the two firms.

He said: “We want to take the pain, take it very quickly and get over it and move on – and that’s what our people want as well.”

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