Aviva has renegotiated its joint venture to distribute protection and pension products through Royal Bank of Scotland (RBS), as it reports a 31% increase in profits for the first half of 2010.
The existing joint venture sees Aviva’s protection, pension and investment products sold through RBS branches with the firms sharing profits.
Under the new arrangement, Aviva will provide protection and selective pension products while RBS will receive all of the profits from the distribution of these products and will also manufacture and distribute its own investment products.
The re-purchase of Aviva’s right to share in distribution profits will hit RBS with a one-off loss of £235m.
Meanwhile, the insurer reported a 31% increase in profits before tax on a market consistent embedded value basis to £1.3 billon compared with £1 billon for the first half of 2009. (article continues below)
Operating profit on an international financial reporting standards basis was up 21% to £1.27 billon from £1 billon in the first half of last year.
Aviva has also boosted its interim dividend per share by 6% to 9.5 pence.