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Insurance merger already paying dividends for Aviva

By Holly Williams

Insurance giant Aviva said it was ahead of plan with moves to combine Friends Life after its £6.5bn tie-up, but stressed the integration was "nowhere near complete".

The life and pensions group, which sealed the industry's biggest merger since 2000 when it snapped up Friends Life in April to create a group with 31,500 employees, said it had already notched up £63m of cost savings from the merger.

Aviva revealed earlier this year that it expects to slash 1,500 jobs, almost 5% of its workforce, and is cutting a third of its offices as part of its plans to make £225m of annual savings from the deal by the end of 2017.

Chief executive Mark Wilson said Aviva was moving to a new phase under its turnaround programme as the group posted slightly better-than-expected half-year earnings of £1.17bn - up 9% on a year earlier.

He said: "After three years of turnaround we are now moving to a different phase of delivery. We have improved the balance sheet, simplified the group and we are now transforming our business."

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