Aviva is continuing to reduce its Spanish presence with the sale of interests in two bancassurance operations and a life business to Santalucia, raising €475m (£403m).

In a statement on Wednesday, the UK insurer said “the transaction is in line with Aviva’s strategy of allocating capital to markets where it can deliver higher returns and is part of a strategic review of its Spanish operations”.

The company said it had sold a 50 per cent interest in Unicorp Vida, a life insurance company, and a similar joint venture with pension provider Caja España Vida. It is also selling its retail life insurance business Aviva Vida y Pensiones.

Aviva started divesting its Spanish assets in 2012 following changes in the Spanish banking system brought on by the 2008 financial crisis. Aviva sold joint venture shareholdings it had with Bankia in 2012 and Novacaixagalicia Grupo in 2014, raising a total of £720m

Mark Wilson, chief executive, said the latest disposals represent “a strong outcome for Aviva”. He said:

The consideration of €475m is an attractive valuation and the sale further simplifies the Group. It highlights our absolute focus on allocating capital effectively across the group and further strengthens our capital and liquidity position.

Aviva said the deal would increase group net asset value by approximately £120m and boost Aviva’s Solvency II capital surplus by £130m.

Aviva retains shareholdings in two life insurance joint ventures – Caja Granada and Cajamurcia, both part of Banco Mare Nostrum, and Pelayo Group.

Aviva’s Spanish disposal plan predates Brexit, and the current industry-wide debate about how to retain passporting rights or the use of single market rules to access one member from an office in another.

But life insurers are less affected by the UK decision to quit the bloc, their markets driven by local products, local preferences and local rules.

Those life insurers that operate in overseas markets tend to do so via fully-fledged subsidiaries, so make little use of passporting.

Aviva, for example, has subsidiaries in France, Italy and Spain. Overseas insurers operating in the UK life market also do so via fully regulated subsidiaries.

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