# Insurer Aviva says capital return and costs targets on track
Author:  Pal Sinha, Barnali 
Author URL: https://financedigest.com/author/pal-sinha-barnali
Published: 2021-11-11
Category: NEWS
Category URL: https://financedigest.com/category/news
Meta Title: Aviva to Return £4 Billion to Shareholders Amid Investor
Meta Description: British insurer Aviva plans to return £4 billion to investors, with potential for more as activist investor Cevian pushes for higher returns.
URL: https://financedigest.com/insurer-aviva-says-capital-return-and-costs-targets-on-trackhtml

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By Carolyn Cohn

LONDON (Reuters) -British insurer Aviva is on track to return at least 4 billion pounds ($5.41 billion) to shareholders and meet cost saving targets, it said on Thursday, as activist investor Cevian pushes for higher returns.

Cevian took a 5% stake in Aviva this year and wants the insurer to return 5 billion pounds in capital to shareholders by the end of 2022 after a recent spate of international disposals.

Aviva said in August that it would return 4 [billion pounds](https://www.financedigest.com/shell-to-evaluate-25-billion-pound-british-investments-after-windfall-tax.html "Shell to ‘evaluate’ 25 billion pound British investments after windfall tax") to shareholders, which Cevian said was insufficient.

There are some different views out there from certain shareholders,” Aviva [finance chief](https://www.financedigest.com/g7-finance-chiefs-agree-on-russian-oil-price-cap-but-level-not-yet-set.html "G7 finance chiefs agree on Russian oil price cap but level not yet set") Jason Windsor told Reuters, adding that the stakeholders remain “very constructive” in their interactions.

Aviva on Thursday said it had completed 450 million pounds of a 750 million pound [share buyback](https://www.financedigest.com/abb-to-launch-1-billion-share-buyback-on-april-3.html "ABB to launch  billion share buyback on April 3"). The remainder of the capital return – at least 3.25 billion [pounds – is likely to take place in the second quarter of next year](https://www.financedigest.com/commonenergy-mistakes-costing-homeowners-hundreds-of-pounds-each-year.html "Commonenergy mistakes costing homeowners hundreds of pounds each year"), Windsor said.

Aviva is also looking to build up its wealth advisory business, either through M&A (mergers and acquisitions) or organic growth, Windsor said, though a purchase would be for less than a [billion pounds](https://www.financedigest.com/edf-delays-uk-nuclear-project-to-2027-ups-price-by-3-billion-pounds.html "EDF delays UK nuclear project to 2027, ups price by 3 billion pounds").

It’s the much [smaller end of the spectrum – it’s about a capability add-on to an already sucessful wealth business,”](https://www.financedigest.com/schneider-and-greenyellow-target-smaller-businesses-with-energy-saving-technology.html "Schneider and GreenYellow target smaller businesses with energy saving technology") he said.

Aviva also said it was on course to achieve a savings target of 300 [million pounds](https://www.financedigest.com/incentive-qas-expands-retail-portfolio-with-million-pound-shopping-centre-contract.html "Incentive QAS Expands Retail Portfolio With Million Pound Shopping Centre Contract") in 2022, relative to a 2018 baseline.

Cevian has said it believes there to be scope for further cost-cutting by the insurer, totalling at least 500 [million pounds](https://www.financedigest.com/uks-nationwide-to-pay-340-million-pounds-to-customers-after-profit-leap.html "UK’s Nationwide to pay 340 million pounds to customers after profit leap") by 2023.

Net flows into Aviva’s savings and retirement [business rose 21% to record levels in the first nine months of the year while general insurance](https://www.financedigest.com/are-there-tax-breaks-for-business-health-insurance.html "Are there tax breaks for business health insurance?") premiums rose 5%, it said in a statement.

Panmure Gordon analysts described the results as “solid” but said Aviva could return an additional 1 billion pounds to shareholders.

Aviva’s shares, which have climbed 25% this year, were up 0.9% at 409.4 pence at 0842 GMT.

($1 = 0.7389 pounds)

(Reporting by Carolyn CohnEditing by Rachel Armstrong and David Goodman)


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