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Interim Results 2017

Disclaimer
Cautionary statements:
This should be read in conjunction with the documents distributed by Aviva plc (the Company or Aviva) through The Regulatory News Service (RNS). This presentation contains, and
we may make other verbal or written forward-looking statements with respect to certain of Avivas plans and current goals and expectations relating to future financial condition,
performance, results, strategic initiatives and objectives. Statements containing the words believes, intends, expects, projects, plans, will, seeks, aims, may, could,
outlook, likely, target, goal, guidance, trends, future, estimates, potential and anticipates, and words of similar meaning, are forward-looking. By their nature, all forward-
looking statements involve risk and uncertainty. Accordingly, there are or will be important factors that could cause actual results to differ materially from those indicated in these
statements. Aviva believes factors that could cause actual results to differ materially from those indicated in forward-looking statements in the presentation include, but are not limited to:
the impact of ongoing difficult conditions in the global financial markets and the economy generally; the impact of simplifying our operating structure and activities; the impact of various
local and international political, regulatory and economic conditions; market developments and government actions (including those arising from the referendum on UK membership of the
European Union); the effect of credit spread volatility on the net unrealised value of the investment portfolio; the effect of losses due to defaults by counterparties, including potential
sovereign debt defaults or restructurings, on the value of our investments; changes in interest rates that may cause policyholders to surrender their contracts, reduce the value of our
portfolio and impact our asset and liability matching; the impact of changes in short or long term inflation; the impact of changes in equity or property prices on our investment portfolio;
fluctuations in currency exchange rates; the effect of market fluctuations on the value of options and guarantees embedded in some of our life insurance products and the value of the
assets backing their reserves; the amount of allowances and impairments taken on our investments; the effect of adverse capital and credit market conditions on our ability to meet
liquidity needs and our access to capital; changes in, or restrictions on, our ability to initiate capital management initiatives; changes in or inaccuracy of assumptions in pricing and
reserving for insurance business (particularly with regard to mortality and morbidity trends, lapse rates and policy renewal rates), longevity and endowments; a cyclical downturn of the
insurance industry; the impact of natural and man-made catastrophic events on our business activities and results of operations; our reliance on information and technology and third-
party service providers for our operations and systems; the inability of reinsurers to meet obligations or unavailability of reinsurance coverage; increased competition in the UK and in
other countries where we have significant operations; regulatory approval of extension of use of the Groups internal model for calculation of regulatory capital under the European
Unions Solvency II rules; the impact of actual experience differing from estimates used in valuing and amortising deferred acquisition costs (DAC) and acquired value of in-force
business (AVIF); the impact of recognising an impairment of our goodwill or intangibles with indefinite lives; changes in valuation methodologies, estimates and assumptions used in the
valuation of investment securities; the effect of legal proceedings and regulatory investigations; the impact of operational risks, including inadequate or failed internal and external
processes, systems and human error or from external events (including cyber attack); risks associated with arrangements with third parties, including joint ventures; our reliance on third-
party distribution channels to deliver our products; funding risks associated with our participation in defined benefit staff pension schemes; the failure to attract or retain the necessary key
personnel; the effect of systems errors or regulatory changes on the calculation of unit prices or deduction of charges for our unit-linked products that may require retrospective
compensation to our customers; the effect of fluctuations in share price as a result of general market conditions or otherwise; the effect of simplifying our operating structure and activities;
the effect of a decline in any of our ratings by rating agencies on our standing among customers, broker-dealers, agents, wholesalers and other distributors of our products and services;
changes to our brand and reputation; changes in government regulations or tax laws in jurisdictions where we conduct business, including decreased demand for annuities in the UK due
to proposed changes in UK law; the inability to protect our intellectual property; the effect of undisclosed liabilities, integration issues and other risks associated with our acquisitions; and
the timing/regulatory approval impact, integration risk, and other uncertainties, such as non-realisation of expected benefits or diversion of management attention and other resources,
relating to announced acquisitions and pending disposals and relating to future acquisitions, combinations or disposals within relevant industries; the policies, decisions and actions of
government or regulatory authorities in the UK, the EU, the US or elsewhere, including the implementation of key legislation and regulation. For a more detailed description of these risks,
uncertainties and other factors, please see Other information Shareholder Information Risks relating to our business in Avivas most recent Annual Report. Aviva undertakes no
obligation to update the forward looking statements in this presentation or any other forward-looking statements we may make. Forward-looking statements in this presentation are
current only as of the date on which such statements are made.
2
Mark Wilson
Group Chief Executive
Performance highlights

Operating profit Capital Cash Interim dividend

1,465m Solvency II ratio


193%1 1,170m cash
+11% 8.40p per share
remittances
Operating EPS +13%
Capital Generation +56%
25.8p, +15% 1.1bn

4
All footnotes on page 27
Operating profit

Operating profit: +11% Growth drivers: HY17

45%

1,465m
1,325m 20%
3%
1,170m 8% (19)%
1,008m 1,071m

HY13 HY142 HY15 HY16 HY17 Aviva Europe UK & Asia Canada
Investors Ireland

5
All footnotes on page 27
Capital & cash

Solvency II cover ratio 1

SII Capital Generation

1.1bn
180%

189% 193%
150% 180%
174% Cash remittances

FY15 HY16 FY16 HY17


1,170m
6
All footnotes on page 27
Interim dividend

Interim dividend up 13%


Interim dividend

8.40p
8.40p
7.42p
6.75p
5.60p 5.85p 2017 share buyback

HY13 HY14 HY15 HY16 HY17


300m
7
All footnotes on page 27
Growth

Life insurance General insurance

New business volumes3 Net written premiums

75%

25%
29% 27%
20%
13% 11% 7% 6% 5%
(28)% (4)%

UK UK pension Asia4 Europe UK Europe France Canada4 UK personal UK Europe4 UK


annuities & Protection4 protection savings savings4 lines commercial commercial
equity & pensions property & motor
release (excl. specialty
France)4

8
All footnotes on page 27
Aviva Investors

Growing Winning mandates Diversifying products

Operating profit 71m (+45%) External appeal Progress on


Operating margin 26% (+6pp) increasing multiple fronts

Assets under management External AUM

345bn 351bn
290bn 72bn
246bn 57bn
45bn 44bn

FY14 FY15 FY16 HY17 FY14 FY15 FY16 HY17

9
Digital

Trading Strategic Disruption

6m registrations5 (+28%) Leading IP


Foundations in place
GI premiums 525m6 (+13%), Using robotics and AI
c25% of total UKGI sales Unlocking back-books
Data & risk analytics
MyAviva: higher propensity Strategic partnerships
to buy 2nd product Ask it Never
Product innovation
45% new business sales to Rewarding loyalty
existing customers

10
All footnotes on page 27
Strategic progress

Oaks Acorns Apple trees

HSBC partnership
Vietnam: 100% owned Spain: capital withdrawn
UK insurance: single
operating model Aviva Investors: AIMS at FPI: sale announced
12bn AUM
RBC integrated in Canada India: re-evaluating options
HK Tencent JV: awaiting
France: progress under new regulatory approval
management

11
Capital management

Underlying inflows Additional inflows

Capital generation Special remittances


Remittances Disposals
Cash
and
Core usage capital Discretionary deployment

Bolt-on M&A
Dividend
Debt repayment
Organic growth
Share buyback

12
Checklist

Grow operating profit 11% growth

Strong capital 193%1, 300m buyback in 2017

Grow dividend 13% growth, on track for 50% pay-out ratio

Reallocate capital Announced disposals, improved focus

Digital Further progress, focused on leading IP

13
All footnotes on page 27
Tom Stoddard
Chief Financial Officer
Operating profit
Operating profit (m) HY16 HY17 Change

UK & Ireland life 711 756 6%


Operating profit

UK & Ireland general insurance & health7 222 259 17%


1,465m
Aviva Investors 49 71 45%
Up 11%
Canada 88 71 (19)%

Europe 430 518 20%

Asia 112 115 3% Operating EPS


Corporate costs, non insurance & other (132) (166) (26)%
25.8p
Group debt & other interest costs7 (155) (159) (3)%
Up 15%
Operating profit 1,325 1,465 11%

15
All footnotes on page 27
Net asset value

Opening NAV per share


414p
at 1 January 20178
Operating profit 26p
Integration & restructuring
costs
Dividends (16)p
Investment variances
& short-term fluctuations
Pension movement
(8)p

0p
Down 50%
AVIF amortisation (5)p
Integration
(1)p
& restructuring
Disposals 5p Basic EPS
Share buyback

Other
(2)p

(1)p
14.9p
Closing NAV per share
412p
Up significantly
at 30 June 20178

16
All footnotes on page 27
UK Life consistent growth
Life operating profit Operating expenses

750m 418m
699m 412m

HY16 HY17 HY16 HY17

Value of new business 3


Highlights
267m
Long term
200m 82m savings
Double digit growth in three core product lines
37m Annuities &
77m equity release
71m 36% growth in new business volumes (PVNBP3)
Protection
79m 88m
Health & other Remittances of 922m, including 315m special
13m 20m
HY16 HY17
17
All footnotes on page 27
UK Life double-digit growth across all core segments

Operating profit Margin Driver


HY16 HY17 HY16 HY17
Target range HY16 HY17
m m % bps % bps
New (45) (40) 11% n/a n/a (45)-(50)
Long Term 88bn 105bn
Existing 109 129 18% 25bps 25bps 25-30bps
Savings (Opening assets) (Opening assets)

Total 64 89 39%

New 88 109 24% 11% 8% 7.5-8.5% 818m 1,435m


(PVNBP3) (PVNBP3)
Annuities & 53bn
Existing 158 200 27% 60bps 70bps 55-70bps 57bn
Equity Release (Opening assets) (Opening assets)

Total 246 309 26%

New 46 67 45% 41% 52% 40-50% 112m 128m


(APE) (APE)

Protection Existing 68 66 (3)% 8% 8% 7.5-8.5% 1.7bn 1.7bn


(In-force premiums) (In-force premiums)

Total 114 133 17%

Legacy 192 187 (3)% 46bps 46bps 35-40bps 83bn 81bn


(Opening assets) (Opening assets)

Other 83 32 (61)%

Total 699 750 7%

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All footnotes on page 27
Aviva Investors maintaining growth momentum
Operating profit AIMS: 12bn AUM
12.0bn
9.0bn AIMS target income
AIMS target return
71m
49m 3.0bn

HY16 HY17 FY15 FY16 HY17

Positive cost-income jaws AUM up to 351bn


300 1.7bn (2.4)bn
1.2bn 6.3bn

250 Operating income


Operating expenses 351bn
345bn
200

150 FY16 External Internal Internal Market 30-Jun-17


HY15 HY16 HY17 net flows core legacy & other
net flows net flows
19
UK & Ireland GI organic growth, improved margins
Operating profit Combined operating ratio9
251m HY16 HY17
7
210m
85m Reported earned COR 93.8% 92.5%
83m
LTIR & other
Of which prior year development +1.5% +0.9%
Underwriting
166m
127m Weather +2.4% +2.9%

HY16 HY17 Normalised AY COR 97.7% 96.3%

Net written premiums Highlights


2,180m 2,326m

Broad-based growth and continued mix optimisation


UK Direct/Digital
Ireland NWP up 12% in constant currency
Non Direct/Digital
HSBC win to support future growth

HY16 HY17

20
All footnotes on page 27
Canada underlying improvement overshadowed by PYD
Operating profit Combined operating ratio9
HY16 HY17
88m
Reported earned COR 95.9% 98.9%
71m LTIR & other
46m
Underwriting Of which prior year development +3.8% (1.6)%
55m

42m Weather (0.9)% (0.4)%


16m
Normalised AY COR 98.8% 96.9%
HY16 HY17

Net written premiums Highlights


1,477m
RBC
265m
1,049m RBC performing in line with expectations

Reported COR: adverse PYD and heightened


1,212m
catastrophe losses

Normalised AY COR: 1.9pp improvement


HY16 HY17

21
All footnotes on page 27
Europe improved growth
Operating profit Combined operating ratio9 & growth
518m HY16 HY17
430m 5
51
2 88 Turkey Net written premiums 757m 879m
47
63 Spain
103 Reported COR 98.9% 92.7%
90 Poland
Italy Of which prior year development +0.7% +2.7%
228 271 France
Weather (2.7)% (2.1)%

HY16 HY17 Normalised AY COR 96.9% 93.3%

Value of new business3 Highlights


243m
10
25 Turkey
188m
28
Operating profit: +9% in constant currency
11 Spain
12
22 Poland
60 Expense discipline: stable in constant currency
42 Italy
France
Announced partial disposal of Spanish business for
120
101 475 million

HY16 HY17
22
All footnotes on page 27
Asia operational progress, portfolio repositioned
Operating profit Operating expenses
112m 115m

70m 70m
FPI
101m
88m

42m 45m

HY16 HY17 HY16 HY17

Value of new business13 Highlights

China: VNB more than doubled

71m Vietnam: acquired 100% ownership, aligned


43m incentives

FPIL: sale announced


HY16 HY17

23
All footnotes on page 27
Capital generation

Operating capital
Underlying generation
capital 1.1bn
generation
0.9bn

(0.2)bn (0.3)bn 0.2bn 193%


189% 1.1bn (0.2)bn 0.2bn (0.7)bn

11.3bn 11.4bn

1
31-Dec-161 BU underlying Debt & Other capital Market, FX Share Disposals Dividend 30-Jun-17
generation centre costs actions and other buyback

24
All footnotes on page 27
Reiterating financial targets

Operating EPS Cash Dividend

Mid-single digit growth 7bn cash remittances 50% pay-out


in medium term 2016 - 2018 ratio 2017

25
Performance and delivery

Operating profit Capital Cash Interim dividend

1,465m Solvency II ratio


193%1 1,170m cash
+11% 8.40p per share
remittances
+13%
Operating EPS Capital Generation +56%
+15% 1.1bn

26
All footnotes on page 27
Footnotes
1. Represents the shareholder view. This excludes the contribution to Group Solvency Capital Requirement (SCR) and Group Own Funds of fully ring fenced with-profits funds 3.2 billion
(FY16: 2.9 billion) and staff pension schemes in surplus 1.2 billion (FY16: 1.1 billion). Includes an estimated adverse impact of a notional reset of the transitional measure on
technical provisions (TMTP) to reflect interest rates at 30 June 2017 0.5 billion decrease to surplus (FY16: 0.4 billion). Also included are the pro forma impacts of the disposal of the
Spanish joint ventures and retail life insurance business (0.1 billion increase to surplus), the disposal of Friends Provident International Limited (0.1 billion increase to surplus), and
the buy-back of the remaining 0.2 billion share capital out of the 0.3 billion total commitment announced 25 May 2017. The 31 December 2016 Solvency II position includes the pro
forma impacts of the disposal of Avivas 50% shareholding in Antarius (0.2 billion increase to surplus) and an anticipated future change to UK tax rules restricting tax relief (0.4 billion
decrease to surplus).
2. Operating profit has been restated to exclude amortisation and impairment of acquired value of in-force business, which is now shown as a non-operating item.
3. PVNBP and VNB are presented on an adjusted Solvency II basis.
4. On a constant currency basis.
5. Total number of UK digital registrations.
6. Gross written premiums.
7. HY16 general insurance and health operating profit has been rebased for the reduction in the AGH loan.
8. NAV is presented net of tax & MI.
9. The combined operating ratio is now reported on an earned basis. Comparators have been realigned to reflect this change.
10. PVNBP and VNB for HY17 and HY16 are presented on an adjusted Solvency II basis. HY15 and HY14 are presented on a MCEV basis.
11. Excluding Eurovita & CxG.

12. A 50 bps increase in corporate bond spread and 10% increase in lapse rates result in a proportionate decrease in Group Own Funds and Group SCR with no overall impact on the
rounded Group cover ratio.

27
Appendix
Life
Operating profit snapshot (Global Life)
% Change

NB Income 600 15%

Underwriting margin 324 5%

Life operating profit


Investment Return 1,366 6%

1,319
1,226
Total income 2,290 8%
9732 1,021

Acquisition expenses (439) (4)%

Admin expenses (678) (6)%

HY14 HY15 HY16 HY17


DAC, AVIF & Other 146 (15)%

OPBT 1,319 8%

30
All footnotes on page 64
Profit drivers (Global life)
Underwriting margin New business (PVNBP10)
3.8%
310m 324m 3.5%
2.7% NB margin
3.0%
247m 2.7% 2.6% Acq. Margin
218m
2.5%
2.2%

20,025m
14,052m 16,568m
12,630m

HY14 HY15 HY16 HY17 HY14 HY15 HY16 HY17

Investment return (AUM / margin) Admin expenses & unit cost


84bps
39bps
78bps 37bps
78bps 35bps 38bps
77bps

330.9bn 356.3bn 637m 678m


273.9bn 507m
231.9bn 408m

HY14 HY15 HY16 HY17 HY14 HY15 HY16 HY17


31
All footnotes on page 64
Investment margin (Global life)
Investment mix Unit linked (reserves/AMC)
1,366
1,284 104bps 105bps
1,072 89 139 76
971 146 97bps 95bps
80 359
118 115 332 Expected return
104
273 Spread
165.9bn
298 147.8bn
Participating
114.8bn
717 792 87.1bn
604 Unit linked
451

HY142 HY15 HY16 HY17 HY14 HY15 HY16 HY17

Participating (reserves/bonus) Spread (reserves/margin)


61bps 60bps 44bps
57bps 41bps
53bps 40bps
44bps

117.4bn 120.5bn 65.7bn 69.9bn


97.7bn 103.5bn 55.7bn
47.1bn

HY14 HY15 HY16 HY17 HY14 HY15 HY16 HY17

32
All footnotes on page 64
Life operating profit snapshot (UK & Ireland)
% Change

NB Income 370 17%

Underwriting margin 164 4%

Life operating profit


Investment Return 676 -
756
711
569
Total income 1,210 5%
483

Acquisition expenses (213) (1)%

Admin expenses (325) 2%


HY142 HY15 HY16 HY17

DAC, AVIF & Other 84 (18)%

OPBT 756 6%

33
All footnotes on page 64
Life profit drivers (UK & Ireland )
Underwriting margin New business (PVNBP10)
164m 3.5% NB margin
158m
2.9% Acq. Margin
2.6% 2.5% 2.3%
103m
2.4% 2.4%
62m 1.8%
11,686m
7,341m 8,571m
6,248m

HY14 HY15 HY16 HY17 HY14 HY15 HY16 HY17

Investment return (AUM / margin) Admin expenses & unit cost


63bps 62bps 61bps 30bps
29bps

58bps 26bps
28bps

220.5bn 233.3bn 332m 325m


175.2bn 253m
124.6bn 162m

HY14 HY15 HY16 HY17 HY14 HY15 HY16 HY17


34
All footnotes on page 64
Life investment margin (UK & Ireland)
Investment mix Unit linked (reserves/AMC)
677 676
91bps 90bps
34 19 80bps
547 135 129
31 74bps
391 105 79 89 Expected return
45 58 Spread
71 107.2bn 118.4bn
Participating
50 429 439 78.7bn
353 Unit linked
225 49.2bn

HY142 HY15 HY16 HY17 HY14 HY15 HY16 HY17

Participating (reserves/bonus) Spread (reserves/margin)


36bps 44bps
41bps
29bps 35bps
39bps
30bps
26bps
51.9bn 61.4bn 65.4bn
44.9bn 49.5bn 51.6bn
34.5bn 40.9bn

HY14 HY15 HY16 HY17 HY14 HY15 HY16 HY17


35
All footnotes on page 64
Life operating profit snapshot (Europe)
% Change

NB income 129 (1)%

Underwriting margin 124 8%

Operating profit
Investment Return 605 11%
455 433
372 395

Total income 858 9%

Acquisition expenses (135) 6%

Admin expenses (300) (16)%


HY142 HY15 HY16 HY17

DAC, AVIF & Other 10 43%

OPBT 433 10%

36
All footnotes on page 64
Life profit drivers (Europe)
Underwriting margin New business (PVNBP ) 10

130m 124m 4.3%


115m 4.0% 4.2%
109m NB margin
3.3%
2.9% Acq. Margin
2.6%
2.3%
2.6%

4,966m 5,627m 5,749m


4,501m

HY14 HY15 HY16 HY17 HY1411 HY15 HY16 HY17

Investment return (AUM / margin) Admin expenses & unit cost


109bps 111bps 112bps 55bps
107bps 53bps
50bps
44bps
48bps

102.6bn 108.4bn 300m


97.8bn 258m
90.5bn 225m 226m

HY14 HY15 HY16 HY17 HY14 HY15 HY16 HY17


37
All footnotes on page 64
Life investment margin (Europe)
Investment mix Unit linked (reserves/AMC)
150bps
144bps 146bps
605
551 545
494 3 48
13
67 3 48 Expected return 119bps
4 43 269 Spread
252 222 258
Participating 36.7bn 38.1bn
Unit linked
31.2bn 32.4bn
225 236 285
219

HY14 HY15 HY16 HY17 HY14 HY15 HY16 HY17

Participating (reserves/bonus) Spread (reserves/margin)


82bps 83bps 60bps
79bps 80bps

25bps
67.1bn 4.3bn 19bps 19bps
61.6bn 62.2bn
56.1bn 3.2bn 3.2bn 3.2bn

HY14 HY15 HY16 HY17 HY14 HY15 HY16 HY17


38
Operating profit snapshot (Asia life)
% Change

NB income 101 36%

Underwriting margin 36 (3)%

Investment Return 85 37% Operating profit


118 120

Total income 222 28%


79

Acquisition expenses (91) (34)%


34

Admin expenses (53) (13)%


HY14 HY15 HY16 HY17
DAC, AVIF & Other 42 (30)%

OPBT 120 2%

39
General insurance
& health
General insurance and health (Group)
Operating profit Net written premium
403 422 417 5,224
334 4,545
4,289 4,218

HY14 HY15 HY16 HY17 HY14 HY15 HY16 HY17

GI Combined operating ratio 9


Investments
Average assets LTIR %
95.8% 93.7% 95.7% 94.5% 2.9% 2.6%
2.4% 2.3%
31.3% 30.9% 32.2% 31.3%
C&E ratio
Loss ratio
17,231
64.5% 62.8% 63.5% 63.2% 15,649 14,662
14,075

HY14 HY15 HY16 HY17 HY14 HY15 HY16 HY17


41
All footnotes on page 64
General insurance and health (UK & Ireland)
Operating profit Net written premium
263 259
239 231 2,619
2,515
2,321 2,342

HY14 HY15 HY16 HY17 HY14 HY15 HY16 HY17

GI Combined operating ratio 9


Investments
Average assets LTIR %
94.3% 93.8% 93.8% 92.5%
2.8%
32.8% 31.6% 33.2% 2.6% 2.6% 2.6%
33.2%
C&E ratio
Loss ratio
10,612 9,320
61.5% 62.2% 60.6% 59.3% 7,335 6,577

HY14 HY15 HY16 HY17 HY14 HY15 HY16 HY17


42
All footnotes on page 64
General insurance and health (Canada)
Operating profit Net written premium
131 1,477

83 88
71 1,026 1,013 1,049

HY14 HY15 HY16 HY17 HY14 HY15 HY16 HY17

GI Combined operating ratio 9


Investments
LTIR %
97.0% 95.9% 98.9% 3.1%
Average assets
91.9%
2.8%
30.6% 31.3% 29.4%
31.0% 2.3%
C&E ratio 2.4%
Loss ratio 4,904
66.4% 69.5% 3,592 3,586 3,878
60.9% 64.6%

HY14 HY15 HY16 HY17 HY14 HY15 HY16 HY17


43
All footnotes on page 64
General insurance and health (Europe)
Operating profit Net written premium
1,044
85 885 912
802
57 59
35

HY14 HY15 HY16 HY17 HY14 HY15 HY16 HY17

GI Combined operating ratio 9


Investments
Average assets LTIR %
97.9% 95.8% 98.9% 2.8%
92.7% 2.4%
28.3% 28.4% 30.4% 2.1%
29.3% 1.9%
C&E ratio
Loss ratio
69.6% 67.4% 68.5% 63.4% 2,962
2,745 2,498 2,620

HY14 HY15 HY16 HY17 HY14 HY15 HY16 HY17


44
All footnotes on page 64
Earnings per
share
Operating earnings per share

HY16 HY17

Group operating profit


1,325 1,465

Less operating tax


(323) (311)

Minority Interest
(67) (73)

DCI and fixed rate tier 1 notes


(21) (23)

Preference shares
(9) (9)

Total operating earnings after tax, MI & DCI and preference shares
905 1,049

Weighted average number of shares


4,046 4,061
Operating earnings per share
22.4 25.8

46
Basic earnings per share
HY16 HY17

Operating profit attributable to shareholders


905 1,049
Investment return variances and economic assumption changes on long-term business
(2) (129)
Short-term fluctuation in return on investments backing non long-term business
(267) (166)
Economic assumption changes on GI & Health business
(98) (10)
Impairment of goodwill, joint ventures and associates and other amounts expensed
0 (19)
Amortisation and impairment of intangibles
(68) (71)
Amortisation and impairment of acquired value of in-force business
(270) (201)
Profit on disposal and remeasurement of subsidiaries, JVs and associates
(18) 192
Integration and restructuring costs and other
(82) (40)
Profit attributable to ordinary shareholders
100 605
Weighted average number of shares
4,046 4,061
Basic earnings per share 2.5 14.9

47
Returns
Operating return on total capital employed

23.2% 22.9%
21.2%
19.7%
18.8%
17.4%

14.6% 14.3%
13.2% 12.9%
12.4% 12.3% 12.1% 11.9%
10.7%
9.9%
8.7%
7.1%

UK & I Life UK & I GI Canada Europe Asia FM

HY15 HY16 HY17

49 1. Following a correction to accounting and modelling for annual management charge rebates in UK Life, prior year comparatives have been restated
All footnotes on page 64
Operating return on total capital employed & return on equity

Group return on capital employed Group return on equity

11.6% 15.5%

9.3% 12.4%
8.8%
11.0%

HY15 HY16 HY17 HY15 HY16 HY17

50
Analysis of operating return on equity
Operating return
Weighted average
m Before tax After tax shareholders funds including Return on Equity %
non-controling interests
UK & Ireland Life 756 606 11,323 10.7%
UK & Ireland GI and Health 259 211 1,817 23.2%
Canada 71 52 1,468 7.1%
Europe 518 367 5,574 13.2%
Asia 115 107 1,661 12.9%
Fund management 69 55 481 22.9%
Corporate and Other Business (130) (88) 5,725 n/a
Return on total capital employed 1,658 1,310 28,049 9.3%
Subordinated debt (191) (154) (7,223) 4.3%
Senior debt (2) (2) (1,384) 0.3%
Return on total equity 1,465 1,154 19,442 11.9%
Less: Non-controlling interests (73) (1,372) 10.6%
Direct capital instrument and tier 1 notes (23) (1,123) 6.1%
Preference capital (9) (200) 8.5%
Return on equity shareholders funds 1,049 16,747 12.4%
51
Capital &
cash flows
Solvency II own funds by tier

Regulatory view* Shareholder view


HY17 bn % of SCR % of own funds
Regulatory view of own funds
Tier 1 22.2 131% 77% adjusted by 5.2bn due to
T1 unrestricted 19.2 113% 66%
with-profits funds, pension
T1 restricted 3.0 18%
schemes and other pro-forma
10%
adjustments
Tier 2 6.3 37% 22%
Tier 3 0.4 2% 1% Shareholder view coverage
28.9 170% 100%
ratio of 193%1

*Estimated

53
Solvency II sensitivities
Impact on Solvency cover ratio (SCR)
30/06/2017 SCR : 193%1
25bps increase in interest rate 4%

100bps increase in interest rate 16%

25bps decrease in interest rate (6)%

50bps decrease in interest rate (12)%

10% increase in market value of equity 2%

10% decrease in market value of equity (2)%

25% decrease in market value of equity (3)%

50bps increase in Corporate Bond spread12 0%

100bps increase Corporate Bond spread (1)%

50bps decrease in Corporate Bond spread (2)%

10% increase in maintenance and investment expenses (7)%

10% increase in lapse rates12 0%

Credit downgrade on the annuity portfolio (4)%

5% increase in mortality / morbidity rates life assurance (2)%

5% decrease in mortality rates annuity business (12)%

5% increase in gross loss ratios (3)%


54
All footnotes on page 64
Subordinated
External debtdebt
aprofile
balanced maturity profile

1,300m
Restricted Tier 1
Tier 2
Tier 3

882m 879m 800m 12.000%


790m
700m
443m
7.875%
450m 615m
6.125%
600m
571m
500m 500m

400m 400m
7.875%
162m
8.25%
210m 500m 6.625%
439m
6.875% 6.875% 5.9021%
267m
8.250% 6.875% 6.875% 5.902% 8.250%
2017 2018 2019 2020 2021 2022 2023 2024 2025 2026 2029 2030 2038

All debt instruments have been presented at optional first call dates at nominal values converted to GBP using 30 June 2017 rates.

55
Balance
sheet
Total managed assets

Assets by liabilities covered Participating assets by type


m 134,578 126,987
350,238
334,694
73,641 70,207
Euro-style
126,987 UK With-profits
134,578 60,937 56,780
style
Participating funds HY16 HY17
Policyholder funds
Shareholder funds Shareholder assets by type
142,493 77,794 80,758
122,322
Annuity &
non-profit
65,171 67,280 GI, Health
& other
77,794 80,758
12,623 13,478
HY16 HY17 HY16 HY17
57
Shareholder assets

Shareholder assets by type Corporate debt by rating


m Total: 27,065m
80,758
77,794 10%
7% 12% 41% 29%
1%
20,963 23,061

Government debt AAA A Less than BBB


Corporate bonds AA BBB Non-rated
28,149 27,065 Other debt
Mortgage loans Government debt by rating
2,934 2,592 Other Total: 23,061m

18,074 18,975 20% 68% 6%6%

7,674 9,065

HY16 HY17 AAA A Less than BBB


AA BBB Non-rated

58
Shareholder assets

Corporate bonds by industry Loans by type


Total: 25,519m
6% 6% 9%
7% 2% 19%
10%
7%

8% 13%

19% 19% 75%

Financials - Banks Communications Loans & advances to banks


Financials - Insurance & other Real estate Healthcare, Infrastructure & PFI other loans
Utilities Oil & gas Mortgage loans
Consumer services Other Other
Industrial
59
Shareholder assets Mortgage loans
Mortgage loans Commercial real estate portfolio
Total: 18,975m Commercial: 6,923m
18%
LTV 95% 83% 85%
61% 58% 58%

37%
Loans
in arrears 1,583 1,492
45% 446 9

Loan
2.4x
interest 1.4x 1.4x 1.5x
2.1x 2.2x
Healthcare, infrastructure & PFI cover
Commercial FY12 FY13 FY14 FY15 FY16 HY17

Securitised mortgage loans & equity release

60
Other
Disposals pro-forma

Antarius Spain (part) FPIL


Completed 1Q17 Expected completion 2H17 Expected completion 2018

m FY16 HY17 FY16 HY17 FY16 HY17


Operating profit (before tax & MI) 78 21 82 39 140 70
Operating EPS* 0.6p 0.2p 0.8p 0.3p 3.5p 1.7p

Proceeds 500m 475m 340m


IFRS NAV impact (net of proceeds) Included c120m gain c(130)m loss

SII surplus impact (net of proceeds) All impacts reflected in HY17 surplus position of 11.4 b illion

* b ased on weighted average numb er of shares of 4,051m at FY16 and 4,061m at HY17

62
Estimated amortisation of acquired value of in-force
600m

500m FPI
FL UK
Other Aviva businesses
400m

300m

200m

100m

0m
2016 2017 2018 2019 2020 2021 2022 2023 2024 2025 2026 2027

This is our latest estimated projection as provided at FY16 and is subject to a variety of factors including the effects of markets.
63 We announced the sale of FPI in July 2017. It is expected to complete in early 2018.
Footnotes
1. Represents the shareholder view. This excludes the contribution to Group Solvency Capital Requirement (SCR) and Group Own Funds of fully ring fenced with-profits funds 3.2 billion
(FY16: 2.9 billion) and staff pension schemes in surplus 1.2 billion (FY16: 1.1 billion). Includes an estimated adverse impact of a notional reset of the transitional measure on
technical provisions (TMTP) to reflect interest rates at 30 June 2017 0.5 billion decrease to surplus (FY16: 0.4 billion). Also included are the pro forma impacts of the disposal of the
Spanish joint ventures and retail life insurance business (0.1 billion increase to surplus), the disposal of Friends Provident International Limited (0.1 billion increase to surplus), and
the buy-back of the remaining 0.2 billion share capital out of the 0.3 billion total commitment announced 25 May 2017. The 31 December 2016 Solvency II position includes the pro
forma impacts of the disposal of Avivas 50% shareholding in Antarius (0.2 billion increase to surplus) and an anticipated future change to UK tax rules restricting tax relief (0.4 billion
decrease to surplus).
2. Operating profit has been restated to exclude amortisation and impairment of acquired value of in-force business, which is now shown as a non-operating item.
3. PVNBP and VNB are presented on an adjusted Solvency II basis.
4. On a constant currency basis.
5. Total number of UK digital registrations.
6. Gross written premiums.
7. HY16 general insurance and health operating profit has been rebased for the reduction in the AGH loan.
8. NAV is presented net of tax & MI.
9. The combined operating ratio is now reported on an earned basis. Comparators have been realigned to reflect this change.
10. PVNBP and VNB for HY17 and HY16 are presented on an adjusted Solvency II basis. HY15 and HY14 are presented on a MCEV basis.
11. Excluding Eurovita & CxG.
12. A 50 bps increase in corporate bond spread and 10% increase in lapse rates result in a proportionate decrease in Group Own Funds and Group SCR with no overall impact on the
rounded Group cover ratio.

64