With Angelique Ruzicka, finance editor
Aviva is in danger of being downgraded from its AA rating by Moody’s after the group posted its results.
The ratings agency said that although Aviva’s capital position was strong, it remained exposed to more deterioration, principally through further asset writedowns.
Moody’s said the group still had substantial exposure to equities (12% of total assets), corporate debt (22%) and mortgage loans (9%) and that any deterioration here could affect surplus capital levels. Aviva’s core profitability was good but the group was still under pressure due to the relative importance of life insurance earnings in the UK and Europe.
According to reports, hedge fund Lansdowne Partners has made almost £13m from shorting Aviva stocks. One newspaper said the fund had had a net short position on 0.27% of Aviva shares since 13 February and the stock had since fallen to half its value. This week, Aviva’s share price plunged 36.45% to 170p per share.