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Aviva's Asian business 'starting point' in review of insurer, CEO says

Aviva PLC CEO Maurice Tulloch said the strategic review of its Asian business is a "starting point" for his broader assessment of the company's strategy.

The U.K. insurer announced along with its first-half earnings Aug. 8 that it had decided to examine strategic options for the Asian operations "to enhance the value of the business to shareholders."

Tulloch took the helm at Aviva on March 4 and vowed three days later to simplify the "far too complex" company. The insurer announced June 6 that it was recombining the management of its U.K. life and non-life businesses and was aiming to cut £300 million of costs by 2022.

Speaking to journalists about the first-half earnings, Tulloch said there was "no specific reason" that the company was reviewing the Asian business rather than its other units. "When I came here I said I would look at all of our business, all of our sub-lines and leave no stone unturned and that's the business I've decided to look at," he added.

Tulloch would not be drawn on the options being considered in the review or whether parts of the Asian business would be sold, saying there would be more discussions about the review at the company's Nov. 20 investor day, although he said that "a full suite of options is being considered" and that "there are lots of different options that may arise during that review."

He also said the review would "examine whether our current strategy and ownership structure is optimal in helping our businesses to reach their full potential."

Could do better

Aviva reported a 1% increase in operating profit to £1.45 billion for the first half from £1.44 billion in the same period of 2018. Tulloch described the results as "okay" but said the company "can achieve much more."

He said Aviva has "delivered resilient results in a challenging market" but added that headline growth was "subdued" and that "I want us to be much more ambitious."

He said the company had made "good progress" on its transformation, with the U.K. life and non-life management combined, the digital business transferred into the U.K. non-life business and the £300 million cost-cutting plan "on track."

Aviva had achieved around £25 million of its planned cost savings so far and plans are in place for half the total, Tulloch added.