Aegon Ltd. · EURONEXT:AGN
Aegon — Q1 2023 Earnings Presentation
30 slides from Aegon's earnings presentation, May 17, 2023
Slide 1: 1Q 2023 Trading Update
1Q 2023 Trading Update Lard Friese Chief Executive Officer Matt Rider Chief Financial Officer May 17, 2023 Helping people live their best lives
Slide 2: Delivering on Aegon's strategic and financial objectives
Delivering on Aegon’s strategic and financial objectives 1 On track for closing the transaction with a.s.r. in 2H 2023 2 Progressing with portfolio optimization 3 Delivering strong growth in life insurance businesses in US and Growth Markets Continuing growth in retirement businesses; challenging en
Slide 3: Growth in US Individual Solutions driven by WFG
Growth in US Individual Solutions driven by WFG US New life sales Individual (in USD million) 1Q22 94 Solutions 1Q23 113 • New life sales growth reflects increase in Transamerica’s market share in WFG due to improved service experience and continued product competitiveness New business strain (Life,
Slide 4: Increasing new business volumes in US Workplace Solutions
Increasing new business volumes in US Workplace Solutions US Written sales 1Q22 1,273 Workplace (in USD million) Solutions – 1Q23 2,550 • Continued sales momentum in Middle- Middle-Market Retirement Plans, market including pooled plan sale of USD 1.7 Retirement billion Net deposits 1Q22 288 Plans (i
Slide 5: Growing UK Workplace platform business; challenging environment for Retail
Growing UK Workplace platform business; challenging environment for Retail UK Workplace net deposits 1Q22 701 (in GBP million) 1Q23 733 • Continued sales momentum in the Workplace channel Retail net deposits 1Q22 23 • Subdued investor sentiment in the (in GBP million) current macro-economic environm
Slide 6: Challenging environment for Asset Management
Challenging environment for Asset Management Asset Management Third-party net deposits 1Q22 0.4 Global Platforms (in EUR billion) (0.4) 1Q23 • Global Platform customers reducing their positions due to adverse developments, leading to third-party net outflows Net deposits • Subdued investor sentiment
Slide 7: Growing steadily in Growth Markets
Growing steadily in Growth Markets Growth Markets New life sales 1Q22 64 (in EUR million) 1Q23 82 • Higher new life sales mainly driven by growth in China following the relaxation of the country’s COVID-19 measures New premium 1Q22 33 • Increase in Accident & Health new production P&C and business o
Slide 8: Progressing with business portfolio optimization
Progressing with business portfolio optimization Progressing with the a.s.r. transaction Divesting individual protection book Aegon NL Aegon UK • Progressing well with the disentanglement of • Reinsuring the book with Royal London with Aegon NL and preparations for asset subsequent Part VII transfer
Slide 9: 1Q 2023 Trading Update
1Q 2023 Trading Update Matt Rider Chief Financial Officer 9
Slide 10: Continuing to deliver on financial commitments
Continuing to deliver on financial commitments Operating capital generation1 EUR 278 million EUR 292 million 1Q 2022 1Q 2023 Free cash flow2 EUR 26 million EUR 47 million 1Q 2022 1Q 2023 Cash Capital at Holding3 EUR 1.6 billion EUR 1.4 billion Dec. 31, 2022 Mar. 31, 2023 Gross financial leverage EUR
Slide 11: Capital positions of main units remaining above operating levels
Capital positions of main units remaining above operating levels Solvency II / RBC ratio 1Q 2023 • Favorable operating capital generation, only partly offset by dividends +11%-pts to the intermediate US holding company US1 436% vs. 4Q22 • Market movements and one-time items with a positive impact, t
Slide 12: Higher capital generation reflects business growth and improvement in claims experience
Higher capital generation reflects business growth and improvement in claims experience Operating Capital Generation – 1Q 2023 (before holding funding and operating expense, in EUR million) 355 162 292 • Higher earnings on in-force driven by Americas, reflecting improved claims experience, lower exp
Slide 13: Cash Capital at Holding in upper half of the operating range
Cash Capital at Holding in upper half of the operating range Cash Capital at Holding1 (in EUR million) 47 1,614 (4) 1,449 1,500 (209) • Free cash flow driven by remittances from AIFMC, Aegon’s asset management joint venture in China Operating range • EUR 109 million cash outflows to shareholders fro
Slide 14: Creating value from Aegon's Financial Assets
Creating value from Aegon’s Financial Assets Financial Assets highlights 1Q 2023 Hedge effectiveness • Continued strong track record in dynamic hedge program US Variable • USD (24) million capital generation from losses from fund basis risk, Annuities 97% which more than offset OCG and better than e
Slide 15: Maintaining a strong balance sheet
Maintaining a strong balance sheet Significant financial flexibility • Capital ratios of main units remain above respective operating levels • Cash Capital at Holding in upper half of operating range Conservative fixed income portfolio • Well-diversified bond portfolio with defensive positioning in
Slide 16: Concluding remarks
Concluding remarks Lard Friese Chief Executive Officer 16
Slide 17: Key messages
1 On track for closing the transaction with a.s.r. in 2H 2023 2 Progressing with portfolio optimization Key 3 Delivering strong growth in life insurance businesses in US and Growth Markets messages Continuing growth in retirement businesses; challenging environment 4 for Aegon AM and Aegon UK 5 Main
Slide 18: Capital Markets Day
Capital Markets Day London, Leadenhall Building June 22, 2023 For questions please contact IR +31 70 344 8305 ir@aegon.com 18
Slide 19: Appendix
Appendix For questions, please contact Investor Relations +31 70 344 8305 ir@aegon.com P.O. Box 85 2501 CB The Hague The Netherlands Helping people live their best lives
Slide 20: Well-diversified US investment portfolio; robust liquidity position
Well-diversified US investment portfolio; robust liquidity position Aegon US asset allocation1 compared to industry2 (US general account, 100% = USD 77.3 billion, on March 31, 2023) 2.7% Cash and Short Term 6.9% 3.2% Aegon US fixed income securities1 Government bonds (in USD billion, total USD 56.0
Slide 21: Diversified US corporate bond portfolio
Diversified US corporate bond portfolio US corporate bond portfolio BBB-rated US corporate bond portfolio (US general account, in USD billion, (in USD billion, on March 31, 2023) on March 31, 2023) 6% 5% 1% 9% 5% 6% 4% 22% • Heavily weighting towards 8% higher ratings within BBB 38% 39.1 23% 19.9 se
Slide 22: Well-diversified, conservative portfolio of corporate bonds issued by banks
Well-diversified, conservative portfolio of corporate bonds issued by banks Banking1 bond portfolio (US general account, in USD billion, on March 31, 2023) By rating By bank type By bond type 3% 3% 13% 2% 2% 40% 39% 36% 17% 4.8 4.8 4.8 61% 62% 2% 5% 5% 4% 5% AA BBB US Money Center US Consumer/Credit
Slide 23: Well-managed CML portfolio with conservative loan-to-value (LTV)
Well-managed CML portfolio with conservative loan-to-value (LTV) US Commercial Mortgage Loan (CML) portfolio LTV split US CML portfolio (based on amortized cost, in USD billion, on March 31, 2023) (based on amortized cost, on March 31, 2023) Multi-Family 54.3% 14% 50.0% 51.5% Industrial 46.9% Overal
Slide 24: Defensive positioning of other real estate related investments in the US general account
Defensive positioning of other real estate related investments in the US general account US commercial MBS1 investments US real estate investments2 (in USD billion, on March 31, 2023) (in USD billion, on March 31, 2023) 1% AAA 2% Energy 7% 1% AA Multi-Family 2% A Commercial & other 3% 31% BBB+ BBB 2
Slide 25: Dutch residential mortgages and real estate as attractive, low-risk investments
Dutch residential mortgages and real estate as attractive, low-risk investments NL mortgage investments1 NL real estate investments, incl. associates / JVs (in EUR billion, on March 31, 2023) (in EUR billion, on March 31, 2023) 5% NHG2 4% Residential 6% 9% 1% LTV <50% Health related LTV 50%-67.5% Co
Slide 26: Key capital sensitivities
Key capital sensitivities Solvency II and RBC sensitivities1 (in percentage points, 1Q 2023) Scenario Group NL Life UK US5 US RBC Equity markets +25% +2% +1% -6% +10% +17% Equity markets -25% -5% -2% +10% -16% -26% Interest rates +50 bps -1% -3% -1% 0% 0% Interest rates -50 bps +2% +4% +1% 0% +1% Go
Slide 27: Conversion of RBC to Solvency II
Conversion of RBC to Solvency II • Conversion methodology for US operations has been agreed with DNB, subject to regular review • Calibration of US insurance entities followed by subsequent adjustment for US debt and holding items - Calibration of US insurance entities is consistent with EIOPA’s gui
Slide 28: Aegon Investor Relations
Aegon Investor Relations Stay in touch Upcoming events Contact Investor Relations Jan Willem Weidema +31 70 344 8028 Annual General Meeting May 25, 2023 Head of Investor Relations Karl-Otto Grosse-Holz +31 70 344 7857 Capital Markets Day June 22, 2023 Investor Relations Officer Hielke Hielkema +31 7
Slide 29: Investing in Aegon
Investing in Aegon Aegon ordinary shares Aegon New York Registry Shares (NYRS) • Traded on Euronext Amsterdam • Traded on NYSE since 1991 and since 1969 and quoted in euros quoted in US dollars • One Aegon NYRS equals one Aegon Amsterdam-listed common share • Cost effective way to hold international
Slide 30: Disclaimer
Disclaimer Cautionary note regarding non-EU-IFRS measures • Changes in the availability of, and costs associated with, liquidity sources such as bank and capital markets funding, as well as This document includes the following non-EU-IFRS financial measures: operating result, income tax, result befo