Aegon’s businesses have reported another quarter of strong underlying growth despite turbulent conditions in world financial markets and a weaker US dollar.
Aegon’s Chairman of the Executive Board and CEO Alexander Wynaendts stated:
"Aegon’s businesses continued to demonstrate strong underlying performance, despite the turbulent environment. Retail sales progressed well during the quarter, in particular in the US and the Netherlands. The downturn in financial markets and a weak US dollar resulted in Aegon reporting considerably lower operating earnings and net income for the first quarter. Since the end of the quarter we have seen a reversal of the widening of credit spreads, which would have reduced significantly the negative impact of fair value assets on Aegon's operating earnings and net income. The quality of our investment portfolio is again demonstrated by the fact that Aegon experienced no material impairments in the first quarter. In addition, our capital position and cash flows remain strong. We also remain confident in our progress toward our 2010 VNB target. Finally, in line with our international growth strategy, we successfully continued our international expansion in Central and Eastern Europe and Turkey.”
Aegon has a focused strategy, aimed at creating long-term value for all its stakeholders. The Group's objectives are to expand its international presence, further strengthen its distribution networks and invest in its growing pension businesses. Aegon took a number of specific steps to meet these objectives:
Aegon's value of new business (VNB) decreased to EUR 186 million. The decline was due primarily to the impact of a weaker US dollar and British pound and a lower contribution from the Group's life reinsurance and institutional businesses in the Americas. There was a decline in VNB from both Taiwan and the Netherlands, because of a recent change in business mix and the effect of markets on unit-linked sales in Taiwan, while in Spain new business volumes were also lower. Aegon's operations in CEE again reported strong growth in VNB, helped by the launch of a new mandatory pension fund in Romania at the start of 2008.
Internal rates of return, meanwhile, improved, rising to 18.4% as the Group continued to focus on writing profitable new business.
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© Aegon 2020