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TheStreet Open House

AEGON Delivers Growth In Sales And Earnings; Maintains Strong Capital Position

Stocks in this article: AEG AEGN

In the United Kingdom, AEGON has successfully implemented its new operating model and reached its target to reduce operating expenses for its Life and Pension businesses by 25% from 2009 levels. The program to restructure the business delivers GBP 80 million in expense savings, the benefits of which are visible in 2012.

In the Netherlands, AEGON is on track with reorganizing its business to be more agile and better positioned to respond to changing conditions and opportunities in the Dutch market. The reorganization program and other initiatives will result in reducing the cost base for AEGON The Netherlands by EUR 100 million, compared to the cost base for 2010. The cost savings aim to offset pressure on underlying earnings from higher mortgage funding costs, increased longevity provisioning and a declining life insurance back-book. The majority of the cost savings is expected to be achieved in 2012. To date, AEGON has implemented costs savings of EUR 49 million.

Delisting from London Stock Exchange

AEGON will make an application to delist its common shares from the London Stock Exchange (LSE) in the United Kingdom. The volume of AEGON shares traded on the LSE is negligible and does not justify the related expenses. The last trading date will be announced once the application to delist has been accepted by the LSE. AEGON shares will remain listed on Euronext Amsterdam and the New York Stock Exchange.

    FINANCIAL OVERVIEW c)
 
    EUR millions                             Notes  Q1 2012 Q4 2011   %  Q1 2011    %
 
    Underlying earnings before tax
    Americas                                            292     316  (8)     336  (13)
    The Netherlands                                      79      75   5       81   (2)
    United Kingdom                                       29     (26)  -       12  142
    New markets                                          88      65  35       68   29
    Holding and other                                   (63)    (84) 25      (83)  24
    Underlying earnings before tax                      425     346  23      414    3
 
    Fair value items                                    156     (20)  -      (85)   -
    Realized gains / (losses) on investments             45      49  (8)      91  (51)
    Impairment charges                                  (41)    (94) 56      (62)  34
    Other income / (charges)                            (17)   (194) 91       (3)   -
    Run-off businesses                                   (2)      1   -       22    -
    Income before tax                                   566      88   -      377   50
    Income tax                                          (45)     (7)  -      (50)  10
    Net income                                          521      81   -      327   59
 
    Net income / (loss) attributable to:
    Equity holders of AEGON N.V.                        521      79   -      327   59
    Non-controlling interests                             -       2   -        -    -
 
    Net underlying earnings                             328     253  30      333   (2)
 
    Commissions and expenses                          1,399   1,684 (17)   1,513   (8)
    of which operating expenses                  11     781     872 (10)     837   (7)
 
    New life sales
    Life single premiums                              1,160   1,876 (38)   1,726  (33)
    Life recurring premiums annualized                  329     311   6      328    -
    Total recurring plus 1/10 single                    445     498 (11)     501  (11)
 
    New life sales
    Americas                                     12     120     109  10      105   14
    The Netherlands                                      32     117 (73)      65  (51)
    United Kingdom                                      213     189  13      247  (14)
    New markets                                  12      80      83  (4)      84   (5)
    Total recurring plus 1/10 single                    445     498 (11)     501  (11)
 
    New premium production accident and health 
    insurance                                           195     188   4      159   23
    New premium production general insurance             14      13   8       13    8
 
    Gross deposits (on and off balance)
    Americas                                     12   7,392   5,009  48    5,629   31
    The Netherlands                                     560     560   -      462   21
    United Kingdom                                        8       9 (11)      19  (58)
    New markets                                  12   3,083   1,522 103    1,267  143
    Total gross deposits                             11,043   7,100  56    7,377   50
 
    Net deposits (on and off balance)
    Americas                                     12   1,061    (886)  -     (233)   -
    The Netherlands                                    (185)   (160)(16)    (115) (61)
    United Kingdom                                       (1)      1   -        2    -
    New markets                                  12   1,364     108   -   (1,719)   -
    Total net deposits excluding run-off 
    businesses                                        2,239    (937)  -   (2,065)   -
    Run-off businesses                               (1,160)   (611)(90)    (880) (32)
    Total net deposits                                1,079  (1,548)  -   (2,945)   -

OPERATIONAL HIGHLIGHTS

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