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Aviva plc Tier 2 Notes - Consent Solicitation - Launch

£600,000,000 Tier 2 Fixed to Floating Rate Notes due 2058 (ISIN: XS0364880186) (the "Notes")

22 JUNE 2023


Full announcement including disclaimers and offer restrictions available via Lonse (Source: Aviva plc.)


"Aviva plc (the "Issuer") announces today an invitation (the "Consent Solicitation") to Eligible Noteholders (as defined below) of its outstanding Notes to consent to the modification of the terms and conditions (the "Conditions") of the Notes and the final terms which complete such Conditions (the "Final Terms") and consequential or related amendments to the transaction documents for the Notes such that the Notes:


(i) continue to be recognised and valued as Tier 2 basic own funds of the Issuer under applicable law, regulation and guidance following the end of the Solvency II transitional period on 31 December 2025; and


(ii) closer align with the terms and conditions of Tier 2 notes currently set out in the Issuer's £7,000,000,000 Euro Note Programme (the "Programme"), which are broadly consistent with the terms and conditions of other similar securities in the market in this regard.


Following the introduction of Commission Delegated Regulation (EU) No. 2015/35 of 10 October 2014 as amended by Commission Delegated Regulation (EU) 2019/981 of 8 March 2019 (the "Level 2 Regulation") supplementing Directive 2009/138/EC of the European Parliament and of the Council of the European Union of 25 November 2009 on the taking-up and pursuit of the business of insurance and reinsurance (Solvency II) (the "Solvency II Directive") as each forms part of retained EU law by virtue of the EUWA ("Solvency II"), new requirements were introduced for capital instruments to be recognised and valued as Tier 2 basic own funds (the "Tier 2 Solvency II Requirements").


The Notes are currently recognised and valued as Tier 2 basic own funds of the Issuer and the Group (being the Issuer and its subsidiaries) under Solvency II and will cease to be so recognised and valued following 31 December 2025 when the transitional period for grandfathered capital under Solvency II (the "Transitional Period") ends, unless the Conditions and the Final Terms are amended appropriately to ensure that they meet the Tier 2 Solvency II Requirements.


The Issuer and the Group will continue to be capitalised in accordance with their respective Solvency II regulatory requirements even if the Notes lose capital treatment under Solvency II and therefore cease to count towards the Tier 2 basic own funds of the Issuer or the Group (as applicable). However, the Issuer intends to manage the efficiency of its capital and therefore proposes to amend the Conditions to ensure the Notes remain Solvency II compliant beyond the end of the Transitional Period. In addition, the Issuer is proposing to make certain additional amendments to the Conditions which are not required by Solvency II but which are intended to bring the Conditions into closer alignment with the terms and conditions of Tier 2 notes currently set out in the Programme, which include certain other features which have become market standard for insurance capital issuances since the issue date of the Notes."


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