zyxwvutsrqponmlkihgfedcbaYXWVUTSRQPONMLKJIHGFEDCBA Welcome to the Annual General Meeting of Shareholders AEGON N.V. Welkom op de jaarlijkse Algemene Vergadering van A Aandeelhouders AEGON N.V. d lh d AEGON N V In order to hear a simultaneous translation into English, we would like to offer you the use of a headset. Please, choose channel 4. you the use of a headset Please choose channel 4 Voor het beluisteren van een simultaanvertaling in het Nederlands kunt u gebruikmaken van een koptelefoon Kies hiervoor kanaal 3 gebruikmaken van een koptelefoon. Kies hiervoor kanaal 3.
Progress of business and Progress of business and significant events in 2009 Alex Wynaendts, CEO & Chairman of the Executive Board
Current market environment GDP growth expectations 1 (%) GDP growth expectations 1 (%) Equity markets 2 Equity markets 2 US Indexed level (December 31, 2002=100) S&P 500 UK 6 Eurozone AEX (Amsterdam) 4 180 FTSE 100 2 160 140 0 120 -2 100 -4 80 -6 60 Q3 Q4 Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 40 Jan-03 Feb-04 Feb-05 Feb-06 Feb-07 Feb-08 Feb-09 2008 2009 2010 2011 Credit spread gapping 2 Total US credit market debt/GDP 3 (%) Average corporate bond yields Average corporate bond yields (%) (%) 10 Y T 10 Y Treasury 350 AA BBB 300 8.0 250 6.0 200 150 4.0 100 2009 1925 1930 1935 1940 1945 1950 1955 1960 1965 1970 1975 1980 1985 1990 1995 2000 2005 2.0 Dec-03 Dec-04 Dec-05 Dec-06 Dec-07 Dec-08 Dec-09 1. Source: Consensus Economics Inc. 2. Bloomberg 3. Total US credit market debt measured by the US Federal Reserve includes debt owed by domestic financial services firms, mortgages, corporate debt, federal government debt, small business debt, consumer debt, state and local government debt, and foreign debt 3 Local knowledge. Global power.
Continued challenges for the insurance industry in 2009 Market environment o Significant improvement financial markets as of financial markets as of Market conditions to remain Maintaining second quarter’09 o Decline in sales uncertain throughout 2010 strong capital volumes in entire industry buffer buffer Insurance companies remains key o Greater emphasis on Significant effect on risk and importance of capital importance of capital capital management o Solvency II capital adequacy requirements Customers o Demand for greater financial guarantees Product redesigns o Demand for simpler and more transparent p products 4 Local knowledge. Global power.
Execution of strategy
AEGON’s ambition “To be a global leader in helping customers secure their financial futures” o Rebalance capital allocation o Rebalance capital allocation o Improve growth and returns o Reduce financial markets risks o Manage AEGON as an international company …resulting in sustainable profitable growth 6 Local knowledge. Global power.
zyxwvutsrqponmlkihgfedcbaYXWVUTSRQPONMLKJIHGFEDCBA Continued focus on execution of strategy Full repayment to the Dutch State Full repayment to the Dutch State Repaid one-third of the EUR 3 billion o Reallocate capital towards businesses with higher growth and return prospects Freed-up EUR 3.3 billion in 2009 – 60% capital efficiency and 40% de-risking o Running off institutional spread-based business in the US o Sale of Taiwanese life insurance activities and Dutch funeral insurance business o Improve growth and return from existing business Improve growth and return from existing business Cost savings of EUR 250 million in 2009, exceeding EUR 150 million target in 2009 o Headcount reduced by 7% in 2009 o Restructuring in the US, UK and the Netherlands o Reduce financial markets risks Reduced risk to equity markets, interest rates and credit markets during 2009 o Manage AEGON as an international company Manage AEGON as an international company Global asset management operational o Launched variable annuities in the Netherlands and Japan o European data center in Edinburgh o Emerging stronger from the crisis 7 Local knowledge. Global power.
Execution of strategy demonstrated by increased results Underlying earnings before tax Underlying earnings before tax Value alue of new business of new business (EUR million) (EUR million) 233 404 216 427 201 351 181 169 169 -22 -181 181 Q4 08 Q1 09 Q2 09 Q3 09 Q4 09 Q4 08 Q1 09 Q2 09 Q3 09 Q4 09 Revenue Revenue-generating investments - generating investments New life sales New life sales (EUR billion) (EUR million) 598 361 354 549 549 543 342 484 334 332 469 Q4 08 Q1 09 Q2 09 Q3 09 Q4 09 Q4 08 Q1 09 Q2 09 Q3 09 Q4 09 8 Local knowledge. Global power.
Focus on operational excellence o Achieved significant improvement in customer service levels – Invest in improving operational capabilities o Continue to be cost efficient operator – Enhance web capabilities – R d Reduce numb ber of f ad dmi ini istrati t t ion pl tf latforms – Reduce processing time – Increase policy per headcount o Building on strong brand names AEGON and Transamerica …while reducing overall cost levels… 9 Local knowledge. Global power.
Continued strong capital position yxwvutsrponmlkjihgfedcbaWVUSRONMIGFEDA Excess capital above AA capital adequacy requirements EUR 3.7 billion Capital preservation initiatives in 2009 EUR 3.3 billion 60% is capital efficiency with generally no material earnings impact 40% is de-risking g Insurance Group Directive: Capital surplus EUR 6.7 billion Solvency ratio 204% Risk Based Capital (RBC) ratio for AEGON USA 362% Continue to maintain substantial capital buffer p 10 Local knowledge. Global power.
Repayment of EUR 1 billion with proceeds from equity issue o First step to full withdrawal from government support – Supported by strong capital position – Repayment of remaining EUR 2 billion top priority o Economic benefits of repayment – Repurchase at EUR 1.15 billion in 2009 versus EUR 1.5 billion thereafter – Avoid potential future coupon p pay yments of at least 8.5% on rep purchased securities o Benefits of replacing convertible core capital securities with equity – Maintain capital buffer and enhance quality of capital – Dilution from the equity issue limited to 12.5% – Stronger position to repurchase the remaining EUR 2 billion of CCCS o Successful equity offering of EUR 1 billion Successful equity offering of EUR 1 billion – Accelerated book building method – Issue price of EUR 5.25 per share – 157,822,000 new shares and 32,654,191 treasury shares 11 Local knowledge. Global power.
Conclusions o Continued focus on execution of strategy o Demonstrated by return to profit Demonstrated by return to profit o Focus on operational excellence, while reducing overall cost levels o Strong capital position AEGON well-positioned for the future for the future 12 Local knowledge. Global power.
Dank u wel Thank you
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