Aviva and Bankia settle on joint venture

Aviva has reached a €608m (£495m) legal settlement with its Spanish partner Bankia.

The insurance group said that it will transfer its entire holding in joint venture Aseval to Bankia in a move which will boost its capital by £500m.

The dispute over the joint venture dates back to Bancaja's merger (as a result of Spain's banking crisis) with Caja Madrid and five other savings banks last year, which resulted in the formation of Bankia.

Aviva argued that the merger breached the terms of its original agreement with Bancaja.