Aviva 2013 Annual Report Download - page 44

Aviva plc
Annual report and accounts 2013
42
Market focus continued
Euan Munro
CEO, Aviva Investors
Aviva Investors
We are Aviva’s investment management business,
managing funds for Aviva and external clients.
We have £241 billion of assets under management.
Our strategy
We aim to increase our contribution to the
Group by capitalising on our expertise managing
Aviva’s own funds to become a strong third-party
manager. We are focused on capabilities and
propositions that build on our experience in
managing long-term savings. This includes our
expertise in xed income, real estate, and
multi-asset funds.
In January 2014 Euan Munro joined as chief
executive. Euan brings substantial expertise in
xed income and multi-asset investing. In the
latter area of investing he gained his reputation
as the architect and principal manager of the UK’s
largest absolute return fund. His appointment
underlines our commitment to growing our asset
management business.
During 2013 we reviewed our strategy with
a view to building a stronger, more protable
business with increased third-party business.
At the heart of this is a focus on offering
investment propositions which deliver predictable
returns with low volatility. Future success will be
driven by serving Aviva customers and external
clients even better, and sharpening the
performance of the business.
Aviva Investors will use its existing global,
multi-channel distribution network to promote
investment strategies and capabilities identied
during the strategic review.
Full year performance
Aviva Investors
2013
£m
2012
£m
Cash remitted to Group 14 15
Operating capital generation 23 7
Aviva Investors: Operating prot, IFRS basis
Fund management 68 39
Long-term insurance and savings
business – Pooled Pensions 23
Other operations –
client compensation costs (96) —
(26) 42
Expenses
Operating expenses 290 306
Integration and restructuring costs 41 33
331 339
IFRS (loss)/prot before tax (89) 2
In 2013 we paid a dividend to Group of £14
million (2012: £15 million). Aviva Investors fund
management operating prot was £68 million
(2012: £39 million) driven by higher revenues
reecting positive market movements and
performance fees together with reduced
operating expenses as a result of cost
savings initiatives.
In 2013, we identied some breaches of the
dealing policy which occurred between 2006
and 2012. The relevant regulatory authorities
were notied. A thorough review of internal
control processes relating to the trading activities
has been carried out.
There is a total adverse impact on Aviva
Investors operating prot from this activity
of £96 million, reecting the compensation
expected to be claimed in respect of these
breaches and associated costs.
The market in 2014
We are operating in a low interest rate
environment and investor risk appetite is slowly
returning. However, institutional investor risk
appetite is likely to remain subdued. This is due
to regulatory factors, giving us the opportunity
to help clients achieve more predictable returns
with limited risk.
Business
in brief
800
Institutional investors
900
Employees
£241bn
Assets under
management
For more information
about market priorities,
turn to page 20
Market type
Turnaround
Aviva Investors
For more information on
nancial performance
see ‘Other Information –
Financial and Operating
Performance’ in our
annual report and
accounts