Aviva, the U.K.’s second-biggest insurer, said it won’t pay bonuses to executive directors or award pay rises for 2013 after cutting its second-half dividend by 44%. The shares plunged.
'These results look ghastly', Marcus Barnard, a London-based analyst at Oriel Securities with a hold rating on the stock wrote in a note to clients.
The company’s 'overall situation' means some executive directors won’t be awarded bonuses for 2012, with some 400 senior staff affected by a pay freeze for this year, CEO Mark Wlson said.
'Whilst we have enough liquidity to pay the current dividend level, the cash flows from the businesses are too tight to sustain that historical level', Wilson said on a call with reporters. 'It’s like walking up an escalator that’s going down-- it’s possible to climb up but eventually the escalator wins'.
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