Aegon announced today that it has successfully completed a structured financing and a securitization transaction in the past month. These transactions provide the company with flexible solutions that help manage reserves and capital in a cost efficient manner.
The first transaction is a 30-year, USD 1.54 billion AXXX / XXX structured credit transaction between an Aegon company and HSBC Bank USA, N.A. This transaction has an initial size of USD 980 million and was designed to provide a cost effective alternative to Letter of Credit (LOC) solutions for Regulation XXX and AXXX redundant reserve requirements in the United States. HSBC has acted as Sole Lead Arranger.
The second transaction involved a private Value of in-force (ViF) securitization by Aegon UK, enabling Aegon UK to monetize a portion of future profits associated with an existing book of unit-linked business. The securitization will add around GBP 90 million to the total core capital of Aegon. The capital created by the transaction will be used by Aegon UK to return capital to the Group. This transaction was managed by Barclays Capital.
Aegon will continue to explore further opportunities for securitizations and structured financing as part of its ongoing commitment to efficiently and actively manage capital and reserve needs.