Speaking at the Bank of America-Merrill Lynch investor conference in London, Mr. Wynaendts said the recent crisis had confirmed that Aegon had “the right strategy” and had “clear short-term objectives” to deal with the current uncertain market environment.
“We’ve taken steps not only to deal effectively with the crisis of the past year, but also to emerge stronger from it,” Mr. Wynaendts told the conference.
“We intend to make the most of the future opportunities which will emerge in the days ahead, and we will do so from a position of strength. We have a strong capital position, a strong franchise with leading market positions, and a clear focus on serving the life-cycle needs of our customers,” he added.
In his speech, Mr. Wynaendts said he saw “clear” opportunities for growth for Aegon not only in its traditional life insurance and pension businesses, but also in the growing ‘at-retirement’ market. He also highlighted the US pension market, which he said was expected to grow faster than GDP in the coming years. Spain, he added, was one of Aegon’s “success stories”, thanks to profitable new business from the company’s joint ventures with regional savings banks, while the Dutch and UK corporate pensions markets also offered increased opportunities for further growth. In addition, Aegon was well positioned to take advantage of the more “rational” pricing of financial products since the crisis, he said.
Elsewhere, Mr. Wynaendts ruled out expanding into new countries or regions – a policy he first announced earlier this year. Instead, he said Aegon would concentrate on improving its position in markets where the company already has developing operations: China, India, Japan, Brazil and Mexico.
Over the past year, like many other financial services companies, Aegon has been battling the effects of the financial crisis, reducing market risk, lowering operating costs and freeing up capital from the company’s businesses around the world. Mr. Wynaendts said these short-term measures had strengthened Aegon’s position – a considerable advantage as world financial markets begin to emerge from the global crisis. Aegon’s plan, he confirmed, was to repay an initial EUR 1 billion to the Dutch state by the beginning of December – providing market conditions don’t deteriorate significantly in the next two months. Last year, Aegon secured a total of EUR 3 billion in core capital – part of broader Dutch government support for banks and insurers in the Netherlands during the financial crisis.
Despite recent improvements, Mr. Wynaendts warned that the current economic environment remains “uncertain”, but stressed that Aegon’s basic long-term priorities remain unchanged: to reallocate more capital to areas that offer stronger growth and higher returns; to improve the growth and returns of the company’s existing businesses and to manage Aegon more as an international company.
Achieving these goals, he said, would help Aegon deliver “sustainable, profitable growth”.
