Aegon Ltd. · EURONEXT:AGN
Aegon — Investor Day (November 2008)
16 slides from Aegon's investor day presentation, Nov 24, 2008
Slide 1: Capital, Costs, Contingency
Capital, Costs, Contingency Alex Wynaendts, CEO AEGON NV AEGON Investor Day London, November 24, 2008 AEGON Investor Day, London, November 24, 2008 1
Slide 2: Global financial turmoil
Global financial turmoil GDP growth expectations1 (EUR million) Total US credit market debt/GDP2 (%) US 350 2.0% Eurozone 300 UK 1.0% 250 200 0.0% 150 -1.0% 100 1925 1930 1935 1940 1945 1950 1955 1960 1965 1970 1975 1980 1985 1990 1995 2000 2005 Jun 08 Jul 08 Aug 08 Sep 08 Oct 08 Nov 08 Credit
Slide 3: Insurance industry faces challenges globally
Insurance industry faces challenges globally Financial markets o Volatility o Illiquidity Increased cost of capital & o Closed capital less availability of capital Need for markets capital buffer Regulators o Focus on capital o Take a more Increased required capital conservative stance Customers o D
Slide 4: Current priorities: Capital, Costs, Contingency
Current priorities Capital Costs Contingency The three C’s AEGON Investor Day, London, November 24, 2008 4
Slide 5: Capital: improve capital efficiency
Capital: improve capital efficiency Optimize o Implement more capital o Capital releases from back books structure o Reinsurance o Insurance linked securities Reduce o Further reduce capital o Equity risk intensity o Interest rate risk o Credit risk Maximize o Manage portfolio of risks diversificati
Slide 6: Capital: proactive steps have been taken to increase capital buffer
Capital: proactive steps have been taken to increase capital buffer o Significant risk reductions implemented - Limited direct equity exposure - Interest rate risks lowered - Guarantees on products lowered - Hedging of guarantees - Asset and liability matching o Strong global risk management organiz
Slide 7: Capital: ongoing acceleration of de-risking and capital release
Capital: ongoing acceleration of de-risking and capital release Complete execution on identified capital preservation and risk mitigation actions of EUR 600 - 800 million in Q4, including: o Lowering investment risk – New money – Existing portfolio o Risk transfer through reinsurance – Fixed annuiti
Slide 8: Contingency: strong capital position provides sufficient buffer
Contingency: strong capital position provides sufficient buffer Pro-forma September 30, 2008 post draw down Insurance Group Directive EUR 5.0 billion EUR 8.0 billion (IGD) surplus capital (160%) (195%) S&P risk-based insurance capital model excess EUR 312 million EUR 312 million capital in operating
Slide 9: Contingency: equity market sensitivity
Contingency: equity market sensitivity Based on equity markets as of September 30, 2008 Estimated impact on earnings Estimated impact on capital (12 month period, EUR million) (EUR million) Assumed Assumed equity market equity market decline of 20% 40% decline of 20% 40% -700 Direct Direct -900
Slide 10: Costs: reduce operating expenses
Costs: reduce operating expenses o Cost reduction measures: o More than EUR 150 million in AEGON’s major operating units in 2009 o Key actions to achieve this include: o US: no wage increase in 2009 and restructuring o NL: restructuring, reduction in projects o UK: restructuring, cost containment AE
Slide 11: Execution of longer term strategic plan
Execution of longer term strategic plan o Improve growth and returns from existing businesses: - Manage for profitability in the Netherlands: - 3 clear priorities: profitability, distribution, culture change - Improve RoC by 100 basis points o Progress on global asset management o Establishing Europ
Slide 12: Resilient and well diversified business
Resilient and well diversified business US gross deposits (USD million) US net deposits (USD million) Individual savings & retirement Individual savings & retirement 4,000 1,000 3,000 Variable annuities 0 2,000 Fixed annuities Retail mutual funds 1,000 -1,000 0 -2,000 Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q1 Q
Slide 13: The right strategy with the right current priorities
The right strategy with the right current priorities o Capital: – Capital preservation and de-risking actions to continue through Q4 and into 2009 o Costs: – More than EUR 150 million savings actions o Contingency: – Sufficient capital buffer to absorb market shocks Strategy with focus on capital is
Slide 14: Q&A
Q&A AEGON Investor Day, London, November 24, 2008 14
Slide 15: For questions please contact Investor Relations
For questions please contact Investor Relations +31 70 344 8305 ir@aegon.com P.O. Box 85 2501 CB The Hague The Netherlands AEGON Investor Day, London, November 24, 2008 15
Slide 16: Cautionary note regarding forward-looking statements
Cautionary note regarding forward-looking statements Cautionary note regarding forward-looking statements The statements contained in this presentation that are not historical facts are forward-looking statements as defined in the US Private Securities Litigation Reform Act of 1995. The following ar