By Simon Jessop
LONDON (Reuters) - British insurer Aviva (L:AV) on Thursday posted a 12 percent increase in full-year operating profit to 3 billion pounds, boosted by growth in its fund arm, Aviva Investors, as well as its British, Canadian and Irish units.
Profit after tax fell 22 percent to 859 million pounds, however, after adding in a 380 million pounds exceptional charge to cover the British government's decision to lower the discount rate used to assess personal injury claim lump sum payouts.
The company said its performance was helped by a strong rise in cash remittances from its various business units, up 20 percent to 1.8 billion pounds, helped by a 15 percent rise in general insurance net written premiums to 8.2 billion pounds.
Life insurance operating profit increased 8 percent to 2.6 billion pounds, helped by growth in protection, pensions and individual annuities in the UK, protection sales and currency effects in Europe.
Fund management operating profit, meanwhile, rose 30 percent to 138 million pounds, boosted by a rise in group assets under management to 450 billion pounds, an increase in revenue margin and improved cost to income ratio.
The company said it would pay a total dividend for the year of 23.3 pence a share, up 12 percent.
Strong cash generation of 3.5 billion pounds helped the firm's Solvency II capital ratio, the rainy day cash buffer to any market shock, rise to 189 percent from 180 percent in 2015.
That gave a surplus of 11.3 billion pounds, up from 9.7 billion pounds last year, and as it is above the firm's flagged range of 150-180 percent, Aviva said it was "actively planning to return additional capital to shareholders and reduce hybrid debt in 2017".
"Aviva's results are simple and clear cut: more operating profit, more capital, more cash, more dividend. And there is more to come," Chief Executive Mark Wilson said in a statement.