Aegon Ltd. · EURONEXT:AGN
Aegon — Q4 2008 Earnings Presentation
93 slides from Aegon's earnings presentation, Mar 12, 2009
Slide 1: Fourth quarter 2008 results
Local knowledge. Global power. Fourth quarter 2008 results Alex Wynaendts, CEO Eric Goodman, CIO AEGON USA Analyst & Investor presentation March 12, 2009
Slide 2: 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
Slide 3: Key messages
Key messages o Strong capital position - Excess capital of EUR 2.9 billion above S&P AA capital adequacy requirements - IGD ratio of 183%; solvency capital surplus of EUR 5.6 billion - NAIC RBC ratio of 350% for the US life operations - Committed to maintain capital level equivalent to AA capital ad
Slide 4: Execution of strategic priorities in Q4
Execution of strategic priorities in Q4 o Capital position strengthened – EUR 1.0 billion of capital released (EUR 1.7 billion in 2008) – EUR 3 billion of additional core capital from Vereniging AEGON funded by Dutch State o Portfolio review: downsizing Institutional Markets Division (IMD) o Cost me
Slide 5: Net loss due to severe financial markets disruption
Net loss due to severe financial markets disruption Net income mainly impacted by financial markets: o Underlying earnings affected by lower equity markets o Impairments on bonds (EUR 360 million) and equities (EUR 141 million) o Extraordinary tax charge of EUR 300 million Underlying earnings to net
Slide 6: Underlying earnings impacted by equity markets decline
Underlying earnings impacted by equity markets decline o Underlying loss before tax of EUR 181 million o Americas experienced a negative impact of USD 839 million, related to: – VA reserve strengthening, DPAC unlocking, and lower fees – Reserve strengthening in life reinsurance o One-off charges in
Slide 7: Fair value items reflect dislocated and illiquid markets
Fair value items reflect dislocated and illiquid markets o Underperformance of fair value investments of EUR 631 million, include - Alternative investments - Investments related to a portfolio of group pension contract in the Netherlands - Credit derivatives o Fair value of liability guarantees had
Slide 8: Higher implied equity volatility assumptions
Higher implied equity volatility assumptions o Underlying earnings include charges related to higher long-term equity volatility assumption for GMIB/GMDB guarantees o Fair value items include higher equity market volatility for guarantees held at fair value Volatility index 1999 – 2009 % 90 80 70 60
Slide 9: Resilient new life sales despite market turmoil
Resilient new life sales despite market turmoil o Total Q4 new life sales of EUR 598 million – Americas sales driven by lower production in retail life and BOLI/COLI – Continued strong annuities sales in the UK – Lower group pension sales in the Netherlands, retail sales held up well – New life sale
Slide 10: Strong deposits drive net inflows
Strong deposits drive net inflows o Total Q4 net deposits of EUR 1.7 billion – Growth driven by fixed annuities and fee-based institutional deposits in the US o Total Q4 gross deposits of EUR 11.9 billion (+24%) – Growth driven by fixed annuities and fee-based institutional deposits in the US – Othe
Slide 11: Value of new business up across major markets
Value of new business up across major markets o Value of new business up by 3% to EUR 233 million – Higher VNB in Americas mainly from fixed annuities – VNB in Netherlands driven by Life & protection – Higher VNB in the UK driven by higher annuity sales and higher margins – Lower VNB in Other countr
Slide 12: Strong capital position
Strong capital position December 31, 2007 December 31, 2008 Insurance Group Directive EUR 6.7 billion EUR 5.6 billion (IGD) surplus capital* (190%) (183%) S&P risk-based insurance capital model excess capital in EUR 1.6 billion EUR 2.9 billion operating units above AA level and holding NAIC RBC rati
Slide 13: Excess capital supported by pro-active capital management
Excess capital supported by pro-active capital management Excess capital development Q4 2008 (EUR million) 3,000 (514) 808 2,875 (287) (1,456) 1,012 312 Impact from capital markets Q3 08 Excess Convertible Credit Rating Interest rates Capital Other Q4 Q4 08 Total Capital in core capital impairments
Slide 14: Core capital primarily impacted by unrealized losses
Core capital primarily impacted by unrealized losses Core capital* development 2008 (EUR billion) 3.0 (0.1) 16.2 (7.2) 15.7 (1.1) (0.2) (0.9) 9.1 Dec 31, 07 Net income Movements in Dividends and Convertible core Other changes Dec 31, 08 Revaluation Dec 31, 08 excluding foreign currency coupons on ca
Slide 15: Total sensitivity to equity markets
Total sensitivity to equity markets Estimated impact on net income* Estimated impact capital* (12 month period, EUR million) (EUR million) � Direct exposure � Direct exposure 600 � DPAC and guarantees 400 � Guarantees � Fees � Fees 200 300 -10% -20% +10% +20% -10% -20% +10% +20% -350 -400 -800 -800
Slide 16: US variable annuity guarantees
US variable annuity guarantees Per December 31, 2008 Total % of Hedged Net amount Statutory fund fund value (USD billion) fund value at risk reserve value hedged Direct - GMIB 7.7 0.9* 12% 3.4 1.1 Direct - GMWB 5.3 5.1 100% 1.0 0.1 Reinsurance 6.1 5.8 95% 1.4 0.8 Total living benefits 19.1 11.8 62%
Slide 17: Actions taken in variable annuities
Actions taken in variable annuities o Added lower risk funds across product lines o Increased prices (60 to 90 bps) o Reduced withdrawal percentages on joint lives o Reduce allowed equity exposure Local knowledge. Global power. 17
Slide 18: The three C's: capital, costs, contingency
The three C’s: capital, costs, contingency o Optimize Capital structure o Capital release of EUR 1.7 billion in 2008 Capital o Target capital release of EUR 1.5 billion in 2009 o Portfolio review: downsizing IMD* o EUR 150 million cost measures in 2009 Costs o Further cost measures will be explored
Slide 19: Capital: EUR 1.7 billion of capital released in 2008
Capital: EUR 1.7 billion of capital released in 2008 Americas United Kingdom o Reinsurance of lapse risk o Reinsurance of lapse risk o De-risking o ViF securitization – Hedging of equity risk Canada o Further improvements ALM – Reduction of hedge fund balances o Active management of investment Nethe
Slide 20: Capital preservation and de-risking plan 2009
Capital preservation and de-risking plan 2009 Capital preservation and risk mitigation (EUR billion) 1.5 o EUR 1.0 billion of capital initiatives completed in Q4 o Additional EUR 1.5 billion of capital 1.0 preservation expected in 2009 – Lower investment risk 0.7 0.4 – Risk transfer through reinsura
Slide 21: Strong liquidity management
Strong liquidity management Normal scenario Nightmare scenario Total AEGON liquidity (EUR billion) Total AEGON liquidity (EUR billion) � Available � Available 100 � Required 100 � Required 80 80 60 60 40 40 20 20 0 0 7day 1mo 3mo 6mo 1yr 18mo 2yr 7day 1mo 3mo 6mo 1yr 18mo 2yr o Cash balances in the
Slide 22: Diversified operational cash generation
Diversified operational cash generation Cash flows AEGON in 2008 Investment (EUR million) Operating cash flow in new business Free cash flow Americas 400 (1,400) (1,000) Netherlands 600 (100) 500 United Kingdom 500 (300) 200 Other 120 (70) 50 Total 2008 1,620 (1,870) (250) Total 2007 (normalized) 3,
Slide 23: No significant holding debt or capital refinancing due over next 4 years
No significant holding debt or capital refinancing due over next 4 years Maturity breakdown of holding company debt (EUR million) 4,699 1,395 539 82 89 421 333 102 740 89 539 57 296 100 2009 2010 2011 2012 2013 2014 2015-2020 2020-2025 2025-2030 2030 and Perpetuals beyond � Backed by asset pools (re
Slide 24: Cost: planned cost measures of EUR 150 million in 2009
Cost: planned cost measures of EUR 150 million in 2009 Americas United Kingdom o Salary freeze o Operational changes to sourcing and IT o Staff reductions / deferred hiring o Reorganization marketing and customer – Total head count reduction ~350 services o Closing down car credit insurance o Headco
Slide 25: Investments
Investments Eric Goodman Local knowledge. Global power. 25
Slide 26: General account mainly in Americas
General account mainly in Americas Total investments General account EUR 332 billion EUR 130 billion Other Holding United countries 0% Off balance Kingdom 5% sheet 4% 29% The Netherlands 25% General account 39% Americas Policyholder 66% account 32% As of December 31, 2008 Local knowledge. Global pow
Slide 27: AEGON general account composition
AEGON general account composition The United Total Americas Other Netherlands Kingdom Cash/treasuries/agency 23% 16% 39% 8% 53% IG Corporate & Preferred 35% 42% 10% 78% 34% High yield corporate 2% 3% 1% 0% 0% Emerging markets debt 1% 2% 1% 1% 0% Non-housing related ABS 4% 5% 1% 8% 0% Housing related
Slide 28: Q4: the debt crisis intensifies
Q4: the debt crisis intensifies o The Q4 environment - Intensification of debt crisis - Mounting financial sector stress - Darkening economic outlook - Gapping credit spreads and declining private sector bond prices - Increasingly aggressive global policy response o Impact on AEGON USA - High other-
Slide 29: Active portfolio management
Active portfolio management o Increased cash and US Treasuries o Reduced hedge fund balances o Lowered financials exposure US General account Dec 31, 2007 Dec 31, 2008 Change Cash/treasuries/agency 8.6% 12.6% � IG Corporate & Preferred 43.8% 41.6% � High yield corporate 3.6% 3.8% � Emerging markets
Slide 30: US Bonds are mostly investment grade
US Bonds are mostly investment grade AEGON USA bond portfolio quality profile EUR 70 billion* - December 31, 2008 B Below B BB 2.4% 0.7% 4.1% BBB 30.5% A & above 62.3% * Based on amortized cost of bonds – IFRS Basis; includes AFS and FVTPL assets. Ratings based on a hierarchy of S&P, Moody’s, Fitch,
Slide 31: US Financial Credit Risk Mitigation
US Financial Credit Risk Mitigation Financials as % of general account assets* EUR 11.4 billion as of December 31, 2008 o Actively reduced financial sector exposure, especially in 2007 and 2008 16% 16% 15% 12% 2005 2006 2007 2008 * General account assets on an IFRS amortized cost basis, excluding po
Slide 32: Credit losses in the US elevated
Credit losses in the US elevated Credit losses in bps of fixed income assets 91 82 64 48 44 44 37 average of 27 bps 27 25 since 1990 17 17 9 8 1 2 4 2 -2 -6 1990 1991 1992 1993 1994 1995 1996 1997 1998 1999 2000 2001 2002 2003 2004 2005 2006 2007 2008 o During Q4, impairments in the US totaled EUR 3
Slide 33: Q4 impairments by asset type for AEGON Americas
Q4 impairments by asset type for AEGON Americas Q4 impairments (EUR million) ABS 102 CMBS 4 RMBS 19 Subtotal structured assets 126 Corporate – private 50 Corporate – public 134 Subtotal corporate 184 Corporate recoveries (26) Subtotal net corporate 158 Other impairments 19 Subtotal net credit impair
Slide 34: Fair value items: alternatives & credit derivatives
Fair value items: alternatives & credit derivatives o Credit derivatives, which are marked to market through operating earnings, lost EUR 45 million due to spread widening during the quarter o Alternative investment returns were disappointing, as most risky asset sectors performed poorly o Hedge fun
Slide 35: Private sector credit spreads spike
Private sector credit spreads spike Option-adjusted spreads for generic market indices (basis points) 12/31/07 09/30/08 12/31/08 bps chg YOY Barcap Index U.S. Corp IG 142 317 399 357 U.S. Corp High Yield 409 733 1,199 1,100 U.S. ABS [Housing] 349 830 1,223 1,216 U.S. ABS [Non-housing] 126 341 601 66
Slide 36: Leading to sharp declines in private sector bond prices
Leading to sharp declines in private sector bond prices Index prices Price 120 110 100 US Credit US High Yield 90 US CMBS US MBS 80 ABS Housing ABS Non-Housing 70 60 50 1995 1996 1997 1998 1999 2000 2001 2002 2003 2004 2004 2006 2007 2008 Local knowledge. Global power. 36
Slide 37: Market Value Changes by Sector – US AFS portfolio
Market Value Changes by Sector – US AFS portfolio Percentage of Q4 08 Q3 08 portfolio US AFS bond portfolio Market value / Market value / amortized cost amortized cost amortized cost 9.1% Commercial MBS 70.9% 90.4% 1.8% Agency MBS 101.5% 97.2% 10.3% Non-agency RMBS and subprime* 59.1% 71.8% 8.5% Non
Slide 38: Key messages
Key messages o Strong capital position - Excess capital of EUR 2.9 billion above S&P AA capital adequacy requirements - IGD ratio of 183%; solvency capital surplus of EUR 5.6 billion - NAIC RBC ratio of 350% for the US life operations - Committed to maintain capital level equivalent to AA capital ad
Slide 39: Q&A
Q&A For questions please contact Investor Relations +31 70 344 8305 ir@aegon.com P.O. Box 85 2501 CB The Hague The Netherlands Local knowledge. Global power. 39
Slide 40: Upcoming AEGON events
Upcoming AEGON events April 22, 2009 Annual General Meeting May 14, 2009 Q1 2009 results and Embedded Value 2008 June 9 and 10, 2009 Analyst and Investor Conference, London August 13, 2009 Q2 2009 results November 12, 2009 Q3 2009 results December 2, 2009 Investor day, New York Local knowledge. Glob
Slide 41: Appendix
Appendix Slide I Q4 2008 country units overview 42 II Total General Account 49 III US investment portfolio detail 55 IV UK investment portfolio detail 76 V Netherlands investment portfolio detail 83 VI Other countries investment portfolio detail 87 VII Other information 90 Local knowledge. Global po
Slide 42: Appendix I: Q4 2008 country unit overview
Appendix I Q4 2008 country unit overview Local knowledge. Global power. 42
Slide 43: Americas – net deposits of USD 3.0 billion
Americas – net deposits of USD 3.0 billion o Capital markets had a severe impact on Underlying earnings before tax underlying earnings (USD million) 723 o Economic downturn impacted sales of high (412) net worth and middle market products o Very strong FA deposits as result of additional distributio
Slide 44: Portfolio review: downsizing Institutional Markets Division
Portfolio review: downsizing Institutional Markets Division o Reduce spread-based balances by USD 20 billion (EUR 14 billion) over two year period o Reduction of credit risk o Capital relief of USD 0.8 billion (EUR 0.6 billion) over two year period (EUR 0.3 billion in 2009) o Expected annual cost sa
Slide 45: Americas – organization aligned with the long term opportunities
Americas – organization aligned with the long term opportunities o Mark Mullin announced as president of AEGON Americas o New organizational structure announced Life and Individual Savings Employer Solutions Alternative Protection and Retirement and Pensions Markets o AEGON Financial o Transamerica
Slide 46: The Netherlands – individual life sales held up well
The Netherlands – individual life sales held up well o Underlying earnings declined to Underlying earnings before tax EUR 75 million, mainly due to lower (EUR million) investment income, as well as one-off 109 charges in other business lines 75 o Positive technical result and exceptional dividend in
Slide 47: United Kingdom – strong new life sales
United Kingdom – strong new life sales o Underlying earnings before tax declined due Underlying earnings before tax to lower fund related charges in pensions (GBP million) 47 o New life sales up 35% driven by strong result of strong sales of annuities 13 o Sales of group pension and unit-linked bond
Slide 48: Other countries – strong growth of deposits
Other countries – strong growth of deposits o Continued strong pension deposit in CEE Underlying earnings before tax and retail mutual fund sales in China (EUR million) 22 o Revenue generating investments increased 24% to EUR 13.6 billion driven by acquisitions and strong underlying growth. -17 Q4 0
Slide 49: Appendix II: Total General Account
Appendix II Total General Account Local knowledge. Global power. 49
Slide 50: Portfolio composition by major asset class
Portfolio composition by major asset class Total General Account (market value) Asset class as of US NL UK OC Total* Total (%) December 31 , 2008 (EUR million) Cash / Treasuries / Agencies 13,904 12,485 415 3,137 29,956 23.0% IG corporates 35,288 3,262 4,089 1,972 44,604 34.1% High yield corporate 2
Slide 51: Collateralized assets by rating
Collateralized assets by rating Total General Account AEGON structured assets (market value in EUR million) per December 31, 2008 Unrealized Unrealized Assets AAA AA A BBB <BBB Total loss loss (%) Commercial MBS 4,069 400 223 81 11 4,783 (1,858) 39% Residential MBS 4,569 48 107 60 134 4,918 (1,992)
Slide 52: Corporate bonds by rating
Corporate bonds by rating Total General Account Credits by rating as per December 31, 2008 B <B AAA BB 1.7% 1.7% AA 2.9% 4.6% 10.2% BBB 34.4% A 44.6% External ratings hierarchy of S&P, Moody’s, Fitch AAA AA A BBB BB B <B Total (all figures in EUR million) Investment grade 1,239 4,426 19,023 14,167 1
Slide 53: Tier 1 bank debt <1% of general account
Tier 1 bank debt <1% of general account Total General Account o Total exposure to financials Corporate bonds are ~37% of general account is 11% of general account Real estate 1% Basic industry Financials 4% 11% o Financials exposure well Consumer diversified and with 74% cyclical 3% rated A or highe
Slide 54: Call schedule of all tier 1 and hybrid exposure
Call schedule of all tier 1 and hybrid exposure Total General Account Call maturity profile bank Tier 1 and Hybrid (EUR million) 160 140 120 100 80 60 40 20 0 2009 2010 2011 2012 2013 2014 2015 2016 2017 2018 2019 2020 2021 2022 2023 2024 2025 2026 2027 2028 2029 2030 2031 2032 2033 2034 2035 2036 2
Slide 55: Appendix III: Americas
Appendix III Americas investment portfolio detail December 31, 2008 Local knowledge. Global power. 55
Slide 56: AEGON USA corporate bonds by sector
AEGON USA corporate bonds by sector US investment portfolio detail AEGON USA corporate bond portfolio December 31, 2008 Gross unrealized Net % Market value Market Amortized Gain Loss unrealized to amortized Corporate bond sector (EUR million) value cost gain (loss) cost Financial Banking 4,694 6,068
Slide 57: US structured assets detail
US structured assets detail US investment portfolio detail Mortgage-backed and Asset-backed Securities Amortized costs December 31, 2008 % Market Net Market Amortized value to (EUR million) unrealized value costs amortized gain/loss costs CMBS 4,372 6,088 (1,717) 71.8% RMBS - GSE Guaranteed 1,398 1,
Slide 58: Prime and near-prime residential MBS
Prime and near-prime residential MBS US investment portfolio detail o Almost all of AEGON’s Prime and Near-prime Residential MBS were rated AAA at the time of purchase o The Near-prime portfolio is composed of primarily Fixed-rate Alt-A and Negative Amortization Floating-rate mortgage securitization
Slide 59: Prime and near-prime residential MBS
Prime and near-prime residential MBS US investment portfolio detail Prime and near-prime residential MBS December 31, 2008 (EUR million) Vintage year Credit Unrealized Amortized cost Fair value Capital structure classification 2008 2007 2006 2005 Pre-2005 enhancement gain/loss Alt-A fixed rate Super
Slide 60: Subprime and near prime second lien collateral book value/unrealized loss
Subprime and near prime second lien collateral book value/unrealized loss US investment portfolio detail o Ratings migration has been experienced in the mezzanine tranches of securitizations collateralized by Hybrid / ARM 1st Lien collateral o Securitizations collateralized by near prime 2nd Lien co
Slide 61: Subprime and second lien exposure
Subprime and second lien exposure US investment portfolio detail Amortized costs Fair value Sub-prime first Sub-prime first lien mortgages lien mortgages Second Second lien lien Total Unrealized Fixed Floating Fixed Floating Total fair amortized gain / rate rate rate rate value cost (loss) AAA 622 2
Slide 62: Sub-prime and second lien by vintage & credit statistics
Sub-prime and second lien by vintage & credit statistics US investment portfolio detail IFRS Unrealized Amortized cost loss (EUR Weighted average loan (EUR million) million) Pool factor age (months) Subordination Excess interest Fixed rate 1st lien senior bond class Pre 2005 345 34 0.16 66 34.8% 2.4
Slide 63: Sub-prime and second lien by vintage
Sub-prime and second lien by vintage US investment portfolio detail Subprime mortgages fixed rate - December 31, 2008 (all figures in EUR million) 2008 2007 2006 2005 Pre-2005 Amortized cost Fair value Unrealized loss AAA - 66 75 152 329 622 510 (112) AA - 16 1 10 45 72 45 (27) A - - - - 1 1 - (1) B
Slide 64: CMBS portfolio snapshot
CMBS portfolio snapshot US investment portfolio detail o The CMBS portfolio has been structured defensively, with over 85% AAA-rated securities o A large majority of our AAA holdings are over-enhanced (i.e. they have more enhancement than needed to retain the AAA rating) o Below-AAA exposures have b
Slide 65: CMBS portfolio roll-up
CMBS portfolio roll-up US investment portfolio detail CMBS Total exposure by vintage December 31, 2008 Amortized cost Ratings hierarchy of S&P, Pre Amortized Unrealized Moody’s, Fitch, Internal 2008 2007 2006 2005 Fair value (all figures in EUR million) 2005 cost loss AAA 288 1,408 1,373 615 1,669
Slide 66: CMBS portfolio detail – conduit deals
CMBS portfolio detail – conduit deals US investment portfolio detail CMBS conduit deals - December 31, 2008 Ratings hierarchy of S&P, Pre Amortized Unrealized Moody’s, Fitch, Internal 2008 2007 2006 2005 Fair value (all figures in EUR million) 2005 cost loss AAA – Senior* 271 992 943 451 1,367 4,02
Slide 67: CMBS portfolio detail – single-borrower deals
CMBS portfolio detail – single-borrower deals US investment portfolio detail CMBS single-borrower deals - December 31, 2008 Ratings hierarchy of S&P, Pre- Amortized Unrealized Moody’s, Fitch, Internal 2008 2007 2006 2005 Fair value (all figures in EUR million) 2005 cost loss AAA 17 89 35 35 162 339
Slide 68: CMBS portfolio detail – large loan deals
CMBS portfolio detail – large loan deals US investment portfolio detail CMBS large loan deals - December 31, 2008 Ratings hierarchy of S&P, Pre Amortized Unrealized Moody’s, Fitch, Internal 2008 2007 2006 2005 Fair value (all figures in EUR million) 2005 cost loss AAA – Senior* - 70 67 1 55 192 156
Slide 69: CMBS portfolio detail – CRE CDO deals
CMBS portfolio detail – CRE CDO deals US investment portfolio detail CMBS CRE CDO deals - December 31, 2008 Ratings hierarchy of S&P, Pre Amortized Unrealized Moody’s, Fitch, Internal 2008 2007 2006 2005 Fair value (all figures in EUR million) 2005 cost loss AAA – Senior* - 29 14 - 50 92 44 (48) AA
Slide 70: CMBS portfolio detail – other deals
CMBS portfolio detail – other deals US investment portfolio detail CMBS other deals - December 31, 2008 Ratings hierarchy of S&P, Pre Amortized Unrealized Moody’s, Fitch, Internal 2008 2007 2006 2005 Fair value (all figures in EUR million) 2005 cost loss Government guaranteed / - 10 15 - 36 60 65 4
Slide 71: Non-housing asset-backed securities
Non-housing asset-backed securities US investment portfolio detail o Credit Card issuers in our portfolio are major financial institutions who have historically managed their Master Trusts successfully through several recessions o Auto exposure is a mixture of consumer and commercial loans. Some cor
Slide 72: High quality commercial mortgages
High quality commercial mortgages US investment portfolio detail 2008 balance 2008 weighted avg LTV LTV distribution (EUR billion) (EUR billion) 2.5 60 2.5 2 2.0 55 1.5 1.5 50 1 0.5 1.0 45 0 0% - 9% 10% - 19% 20% - 29% 30% - 39% 40% - 49% 50% - 59% 60% - 69% 70% - 79% 80% - 89% 90%-100+% 0.5 40 0.0
Slide 73: Commercial mortgage loan allocation is typical for US life industry
Commercial mortgage loan allocation is typical for US life industry US investment portfolio detail As of December 31, 2008 AEGON data includes Agri-business loan portfolio 40% 30% AEGON 20% ACLI 10% 0% Office Retail Industrial Apartment Agricultural Other 30% 20% 10% 0% New Middle East North West No
Slide 74: Commercial mortgage loans in default
Commercial mortgage loans in default US investment portfolio detail As of December 31, 2008 2.0 � AEGON � ACLI 1.5 1.0 0.5 0.0 3Q03 4Q03 1Q04 2Q04 3Q04 4Q04 1Q05 2Q05 3Q05 4Q05 1Q06 2Q06 3Q06 4Q06 1Q07 2Q07 3Q07 4Q07 1Q08 2Q08 3Q08 4Q08 Local knowledge. Global power. 74
Slide 75: Debt coverage ratio by top 5 MSA's and type
Debt coverage ratio by top 5 MSA’s and type US investment portfolio detail IFRS Amortized Cost Property Type Weighted Avg DCR (EUR millions) Office 3,682 1.7 Retail 2,136 1.7 Industrial 2,040 1.5 Apartment 1,936 1.7 Other 400 1.4 Total 10,195 1.7 IFRS Amortized Cost MSA Weighted Avg DCR (EUR million
Slide 76: Appendix IV: United Kingdom
Appendix IV United Kingdom investment portfolio detail December 31, 2008 Local knowledge. Global power. 76
Slide 77: UK general account mainly bonds
UK general account mainly bonds UK investment portfolio detail Total investments General account EUR 49 billion EUR 5 billion Shares Loans 1% <1% Off balance sheet 5% General Policyholder account account 11% Bonds 84% 99% Note: data as per December 31, 2008 Local knowledge. Global power. 77
Slide 78: UK general account portfolio
UK general account portfolio UK investment portfolio detail Percentage of Market value / UK general account* amortized cost amortized cost 7% Asset backed securities 88% 1% Basic industries 81% 8% Communications 87% 3% Consumer, cyclical 83% 6% Consumer, non-cyclical 96% 2% Energy 92% 47% Financial
Slide 79: Rating split of UK general account
Rating split of UK general account UK investment portfolio detail o The UK general account is predominantly investment grade o A downgrade below investment grade is a trigger for considering a sale o Other main trigger being concerns about the credit Ratings split Market value / Index General Differ
Slide 80: Corporate bonds by rating
Corporate bonds by rating UK investment portfolio detail Credits by rating as per December 31, 2008 <B AAA BB B 0.1% 3.1% 0.3%0.0% AA 12.2% BBB 21.5% A 62.8% External ratings hierarchy of S&P, Moody’s, Fitch AAA AA A BBB BB B <B Total (all figures in EUR million) Investment grade 123 484 2,463 825 -
Slide 81: UK investments conservatively positioned
UK investments conservatively positioned UK investment portfolio detail The UK general account is conservatively positioned versus the iBoxx non-gilt bond index for all investment grade non-gilts rated AA to BBB Sector split Index General Difference Account Non-financials 32% 39% 7% Asset/mortgage-b
Slide 82: Comfortable with our exposure to UK financials
Comfortable with our exposure to UK financials UK investment portfolio detail o AEGON UK is underweight banks Financials break down Market value / Index General Difference amortized cost Account Banks 71% 39% 27% -12% Insurance 66% 9% 10% 1% Other financial 73% 4% 4% 0% Total 70% 52% 41% -11% Note:
Slide 83: Appendix V: Netherlands
Appendix V Netherlands investment portfolio detail December 31, 2008 Local knowledge. Global power. 83
Slide 84: Dutch general account well diversified
Dutch general account well diversified Netherlands investment portfolio detail Total investments General account EUR 63 billion EUR 32 billion Off balance Loans sheet 32% 19% Other <1% Real estate 6% General account Shares 4% 51% Policyholder account Bonds 30% 57% Note: data as per December 31, 2008
Slide 85: Almost all collateralized assets are AAA
Almost all collateralized assets are AAA Netherlands investment portfolio detail External ratings hierarchy of S&P, Market Total Unrealized Moody’s, Fitch AAA AA A BBB <BBB value / book (all figures in EUR million) exposure loss value (%) ABS 358 8 62 35 5 468 122 80% RMBS 959 4 - - - 964 147 87% RM
Slide 86: Corporate bonds by rating
Corporate bonds by rating Netherlands investment portfolio detail Credits by rating as per December 31, 2008 AAA <B 4.2% 14.2% AA 16.8% B 2.8% BB 6.4% BBB 17.6% A 38.1% External ratings hierarchy of S&P, Moody’s, Fitch AAA AA A BBB BB B <B Total (all figures in EUR million) Investment grade 158 628
Slide 87: Appendix VI: Other countries
Appendix VI Other countries investment portfolio detail December 31, 2008 Local knowledge. Global power. 87
Slide 88: Other countries general account mainly bonds
Other countries general account mainly bonds Other countries investment portfolio detail Total investments General account EUR 14 billion EUR 6 billion Off balance sheet Loans 39% 18% Other 2% General Shares account 3% 46% Bonds 77% Policyholder account 15% Note: data as per December 30, 2008 Local
Slide 89: Corporate bonds by rating
Corporate bonds by rating Other countries investment portfolio detail Credits by rating as per December 31, 2008 BBB BB AAA 4.0% 0.3% 7.2% AA 26.0% A 62.5% External ratings hierarchy of S&P, Moody’s, Fitch AAA AA A BBB BB B <B Total (all figures in EUR million) Investment grade 140 505 1,216 78 - 0
Slide 90: Appendix VII: Other information
Appendix VII Other information December 31, 2008 Local knowledge. Global power. 90
Slide 91: Strong financial flexibility
Strong financial flexibility Other information Financial flexibility (EUR billion) (EUR million) Shareholders’ equity 6,055 4.2 Core convertible capital securities 3,000 Revaluation reserve 7,167 Core capital 16,222 excl. revaluation reserve Group equity 20,652 Capital leverage 270 1.8 Total capital
Slide 92: Q4 has been an extraordinary quarter
Q4 has been an extraordinary quarter Other information o US corporate BBB spreads have seen significant widening in the last quarter o Performance of US corporate BBB spreads has improved in 2009 o Equity volatility spiked during the fourth quarter US BBB corporate bonds spreads Volatility index (ba
Slide 93: 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 Local knowledge. Global power. 93