Aviva 2009 Annual Report Download - page 17

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Performance review
Aviva plc Europe continued
Annual Report and Accounts 2009
Delta Lloyd performance
Our Delta Lloyd business is one of the top-five financial services
providers in the Netherlands and also operates in Belgium and
Germany. In 2009, we completed the successful IPO and partial
sale of Delta Lloyd on Euronext Amsterdam with gross proceeds
of £1 billion for a 42% stake. This was a significant strategic
milestone in our management of Delta Lloyd and gives us
further opportunity to reallocate capital within the group.
The market environment in the Netherlands remained
challenging, with weak asset values constraining activity in the
corporate pensions market, before improving in the latter part
of the year when Delta Lloyd secured two large group contracts.
Total sales in 2009 of £5,492 million were down 18% reflecting
the sale of the health business. IFRS operating profit for the year
increased 29% to £399 million. These results are discussed in
more detail on page 46 of this report.
Delta Lloyd continues to offer innovative, high quality
products backed by strong fund management performance.
In June, in collaboration with Rabobank, Delta Lloyd launched
a €200 million fund, which offers an alternative source of
capital for promising Dutch ventures.
In 2009, we successfully integrated the Swiss Life Belgium
operation with our existing Belgian life operations. Belgium
extended the ABN AMRO distribution arrangement to include
Fortis branches when they are rebranded in 2010.
Outlook
Market conditions will continue to vary considerably between
countries: the recession is still challenging in Ireland, Spain and
Hungary but we are seeing signs of recovery in France, Italy and
Poland. By continuing to carefully balance profit generation and
investment opportunities across our broad and diverse portfolio
and by enhancing innovative customer focused offerings, we
are confident that we can benefit from the growth potential
within Europe.
Aviva Europe: Making a ‘Quantum Leap’
in performance
In 2009, we announced our new strategy to make a ‘Quantum
Leap’ in performance by integrating the operations of our
12 separate Aviva Europe businesses. We are creating a single
pan-European organisation which will create significant value
for Aviva’s customers and shareholders.
By moving to a pan-European operating model, we are
simplifying our product range, shortening the time to launch
new products for our customers and making significant
efficiency gains by centralising our operations, enabling us to
improve cost management, grow net profits and enhance
dividends remitted to the Group.
As part of our transformation, we are also establishing a
single holding company for our European operations in Ireland.
This new structure will deliver economic, operational and
regulatory benefits, especially with the anticipated introduction
of Solvency II in 2012.
Our two pan-European distribution channels,
bancassurance and retail, supported by pan-European product
development, operations and governance will enable us to
take full advantage of the significant growth potential and
opportunities in Europe and contribute fully to the 'One Aviva,
Twice the Value' target.
Corporate responsibility
Governance
Shareholder information
Financial statements IFRS
Financial statements MCEV
Other information
General insurance and health net written premiums £m
Europe Delta Lloyd
09 3,046
08 4,090
07 3,232
06 3,287
05 2,754
General insurance and health IFRS operating profit £m
Europe Delta Lloyd
09 275
08 397
07 442
06 417
05 390
Performance review