Leading outside contender Andy Haste understood to have ruled himself out
Aviva chief financial officer Patrick Regan has emerged as the front-runner to take over at the company now that former RSA chief executive Andy Haste is understood to have ruled himself out.
Market insiders say that incoming chairman John McFarlane, who has taken day-to-day control of the business ahead of a strategic review, has already placed Regan top of the list among the internal candidates.
Haste, who is still on gardening leave for the next couple of months and fits the bill having turned around RSA in the space of a couple of years, is not interested in the job according to reports.
One source close to Haste, whose wife is American, said he was keen to go to the USA and doubted whether he had the appetite for another tough job like Aviva.
The source was also sceptical about former Aviva UK chief executive Patrick Snowball’s chances, having been overlooked before, despite having done a “sterling” job at Suncorp in Australia.
Towergate chief executive Mark Hodges, a former Aviva UK head, refused to comment on whether he would be willing to return to Aviva.
Another candidate is former European chief executive Igal Mayer. Although Mayer was highly rated, it would be a brave decision to appoint someone who left the company only last month in Moss’s boardroom shake-up aimed at saving money.
Another outside bet is former Lloyd’s chief executive and Prudential number two Nick Prettejohn, who is understood to be close to McFarlane and is said to be considering whether to make himself available for the job.
Shore Capital analyst Eamonn Flanagan said Regan and head of developed markets Trevor Matthews were the obvious choices from within, while Haste was the leading external contender, with Evelyn Bourke at Resolution an outsider.
Flanagan also questioned new chairman John McFarlane’s role and his desire to improve the company’s financial strength, including the sale of its lucrative US life assurance business for $1bn.
He pointed out that, despite his perceived failings, Moss had already managed to beef up Aviva’s capital position through the disposal of RAC and the Delta Lloyd IPO.
McFarlane said on taking over day-to-day control that he is keen to build up Aviva’s financial strength, which could be hit if the eurozone deteriorates further.
Flanagan expressed concern that building capital strength would be at the expense of a reduction in dividends. “To want to build on the financial strength smells of a dividend cut to me,” he said.
“McFarlane seems to be putting markers in the sand which are pointing the company in a certain direction without a new chief executive,” he added.
Steadying the ship
Brokerbility’s chairman Ashwin Mistry said whoever took over would need to be a strong leader as the task ahead is huge.
“It has got to be someone who can add some gravitas and effectively steady the ship, but at the moment I have nobody I would say should get it or could get it,” he said. “One thing is for sure - whoever comes in has got a monumental task.”
Moss waved goodbye to a £2.4m bonus in deferred shares after quitting the company following a stormy AGM in which he came under fire from shareholders, but will still pocket a £1.75m golden goodbye.
It has since come to light that he demanded a 9.5% pay increase just weeks before his exit, which would have taken his basic salary to £1.05m according to a newspaper report.
Aviva’s share price closed at 315p last Monday following Moss’s departure, before plunging to 290p one week later.