Aviva reassures shareholders
Tuesday, 28 Oct 2008 11:47
Aviva has reassured shareholders its capital position is strong
Aviva has insisted its capital position is strong in an interim statement, sending its shares soaring.
The UK's largest insurance firm said it has direct access to £1.6 billion of liquid assets and £2.2 billion of credit available should it need more cash in the third quarter update.
Norwich Union parent Aviva was the biggest riser on the FTSE 100 this morning, up 12.03 per cent by 10:44 BST.
However, Aviva did admit that due to the plunging values of equities, £600 million was wiped off its surplus in less than a month.
As of September 30th, the company had £1.9 billion in surplus. This had fallen to £1.3 billion by October 24th.
Andrew Moss, Aviva chief executive, said: "These are unprecedented times. Our share price has been affected by the huge uncertainty in financial markets, but people around the world are still saving and buying insurance from brands they trust, like Aviva."
The company also revealed a 12 per cent rise in life and pensions sales to £25.6 billion.
The group added its dividend policy in the UK remains unchanged and it is on track to achieve cost savings of £200 million in 2008.