AGN Aegon Ltd

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The Hague, August 17, 2023 - Starting the next chapter of Aegon’s transformation with solid 1H 2023 performance

• IFRS results from now on reported under the new insurance accounting standard IFRS 17
• Net loss of EUR 199 million reflects previously announced investments and assumption updates in the US
• Operating result increases by 3% compared with the first half of 2022 to EUR 818 million
• Operating capital generation before holding funding and operating expenses increases by 13% compares with the first half of 2022 to EUR 620 million reflecting business growth and improved claims experience
• The capital ratios of main units remain above their respective operating levels; Group Solvency II ratio amounts to 202%
• Cash Capital at Holding decreases to EUR 1.3 billion, mainly as a result of capital returns to shareholders
• 2023 interim dividend increases by EUR 0.03 compared with 2022 interim dividend to EUR 0.14 per common share
• Transaction combining Aegon’s Dutch businesses with a.s.r. closed in July; related EUR 1.5 billion share buyback has begun
• Strong sales growth in US, UK Workplace business, and life insurance businesses in China and Brazil. Sales momentum in asset management and UK Retail businesses affected by challenging market conditions

Statement of Lard Friese, CEO“Aegon had a solid first half of the year. Our operating result increased by 3% compared with the same period in 2022, and reflects improved results in all insurance units while asset management was negatively impacted by a challenging market environment. Our net result was a loss of EUR 199 million, and reflects previously announced items in the US that will position us well for future growth. Our operating capital generation was strong, driven largely by our US business. The capital ratios of our main units remained above their respective operating levels in the first half of 2023. These results provide a solid basis to raise the interim dividend by 3 eurocents compared with the 2022 interim dividend to 14 eurocents per share.

In the US, Transamerica performed well. New Life sales increased by 17% compared with the previous year, driven by another strong increase in the number of World Financial Group (WFG) agents, now at a record-high of 70,000. Written sales of mid-sized retirement plans increased almost 70%, driven largely by a pooled plan sale of USD 1.7 billion. Aegon’s UK Workplace solutions platform also continued to deliver strong results, with a significant increase in net deposits driven by the onboarding of new schemes and higher net deposits on existing schemes. We also saw increased sales in our partnerships in China and Brazil. At the same time, results at Aegon’s asset management and UK Retail businesses continued to be affected by adverse market conditions.

We took significant steps in our transformation. We completed the sale of Aegon’s insurance, pension and asset management business in Central and Eastern Europe, and we announced the sale of our stake in our business in India. In addition, we closed the transaction with a.s.r. for which Aegon received EUR 2.2 billion and a 29.99% stake in a.s.r., and we have started the related EUR 1.5 billion share buyback program.

Now we have begun the next chapter in our transformation. At our 2023 Capital Markets Day held in June, we outlined how we will invest in our Strategic Assets. In the US, we will ensure that Transamerica captures its full potential and becomes America’s leading middle market life insurance and retirement company. At the same time, Transamerica will continue to reduce its exposure to Financial Assets and to improve the level and predictability of capital generation. In this respect, we welcome the fact that we have been able to execute an additional reinsurance transaction on 14,000 universal life policies with secondary guarantees, generating approximately USD 225 million of capital that will be used to further reduce Aegon’s exposure to Financial Assets over time. Together with the prior reinsurance transaction undertaken in 2021, a total of 25% of the statutory reserves backing these policies have now been reinsured.

As part of our strategy, we are also investing in our partnerships. Aegon Asset Management and La Banque Postale have extended their partnership via their joint venture, La Banque Postale Asset Management (LBP AM), through to 2035. Through our shareholding, Aegon has also participated in LBP AM’s acquisition of La Financière de l’Echiquier, which will accelerate LBP AM’s growth strategy. In the UK, Aegon has extended its partnership with Nationwide Building Society (NBS) under which Aegon UK will integrate NBS’ financial planning teams in order to support its strategy to be the leading digital platform provider in the workplace and retail markets. In addition, Aegon has increased its economic ownership in its Brazilian joint venture, Mongeral Aegon Group, to almost 60%.

I would like to thank our colleagues for all their hard work and dedication in ensuring the success of our ongoing transformation."

Contacts

Additional information

PresentationThe conference call presentation is available on aegon.com as of 7.00 a.m. CET.

SupplementsAegon’s first half 2023 Financial Supplement and other supplementary documents are available on aegon.com.

Conference call including Q&AThe conference call starts at 9:00 am CET, with an audio webcast on aegon.com. To join the conference call and/or participate in the Q&A, you will need to register via the following registration link. Directly after registration you will see your personal pin on the confirmation screen and additionally you will receive an email with the call details and again your personal pin to enter the conference call. To avoid any unforeseen connection issues, it’s recommended to make use of the ‘call me’ option. Two hours after the conference call, a replay will be available on aegon.com.

Click to joinWith ‘Call me’, there’s no need to dial-in. Simply click the following registration link and select the option ‘Call me’. Enter your information and you will be called back to directly join the conference. The link becomes active 15 minutes prior to the scheduled start time. Should you wish not to use the ‘click to join’ function, dial-in numbers are also available.

Dial-in numbers for conference callUnited States: +1 864 991 4103 (local) United Kingdom: +44 808 175 1536 (toll-free) The Netherlands: +31 800 745 8377 (toll-free) The Netherlands: +31 970 102 86838 (toll)

Passcode: you will receive a personal pin upon registration.

Financial calendar 2023Extraordinary general meeting – September 29 and 30, 2023 Trading update third quarter 2023 – November 16, 2023

About AegonAegon is an international financial services holding company. Aegon’s ambition is to build leading businesses that offer their customers investment, protection and retirement solutions. Its portfolio of businesses includes fully owned subsidiaries in the US, UK and a global asset manager. In addition, Aegon has partnerships in Spain & Portugal, Brazil, and China, which create value by combining strong local partners with Aegon’s international expertise. In the Netherlands, Aegon generates value via a strategic shareholding in a market leading insurance and pensions company.

Aegon's purpose of helping people live their best lives runs through all its activities. As a leading global investor and employer, Aegon seeks to have a positive impact by addressing critical environmental and societal issues, with a focus on climate change and inclusion & diversity. Aegon is headquartered in The Hague, the Netherlands, and listed on Euronext Amsterdam and the New York Stock Exchange. More information can be found at aegon.com.

Local currencies and constant currency exchange ratesThis document contains certain information about Aegon’s results, financial condition and revenue generating investments presented in USD for the Americas and in GBP for the United Kingdom, because those businesses operate and are managed primarily in those currencies. Certain comparative information presented on a constant currency basis eliminates the effects of changes in currency exchange rates. None of this information is a substitute for or superior to financial information about Aegon presented in EUR, which is the currency of Aegon’s primary financial statements.

Cautionary note regarding non-EU-IFRS measuresThis document includes the following non-EU-IFRS financial measures: operating result, MCVNB, IFRS new business value, return on equity and addressable expenses. These non-EU-IFRS measures, except for addressable expenses, are calculated by consolidating on a proportionate basis Aegon’s joint ventures and associated companies. Operating result reflects Aegon’s result from underlying business operations and excludes components that relate to accounting mismatches that are dependent on market volatility or relate to events that are considered outside the normal course of business. MCVNB is the abbreviation for Market Consistent Value of New Business and is not based on EU-IFRS and should not be viewed as a substitute for EU-IFRS financial measures. Aegon may define and calculate market consistent value of new business differently than other companies. IFRS new business value is calculated as the sum of the new business contractual service margin and new onerous contracts, after reinsurance (excluding retrospective impacts) and tax. Return on equity is a ratio using a non-EU-IFRS measure and is calculated by dividing the operating result after tax less cost of leverage by the average shareholders’ equity. Operating expenses are all expenses associated with selling and administrative activities (excluding commissions). This includes certain expenses recorded in other charges for segment reporting, including restructuring charges. Addressable expenses are calculated by excluding the following items from operating expenses: direct variable acquisition expenses, restructuring expenses (including expenses related to the operational improvement plan), expenses in joint ventures and associates and expenses related to acquisitions and disposals. Addressable expenses are reported on a constant currency basis. Aegon believes that these non-EU-IFRS measures, together with the EU-IFRS information, provide meaningful supplemental information about the operating results of Aegon’s business including insight into the financial measures that senior management uses in managing the business.

Forward-looking statementsThe statements contained in this document that are not historical facts are forward-looking statements as defined in the US Private Securities Litigation Reform Act of 1995. The following are words that identify such forward-looking statements: aim, believe, estimate, target, intend, may, expect, anticipate, predict, project, counting on, plan, continue, want, forecast, goal, should, would, could, is confident, will, and similar expressions as they relate to Aegon. These statements may contain information about financial prospects, economic conditions and trends and involve risks and uncertainties. In addition, any statements that refer to sustainability, environmental and social targets, commitments, goals, efforts and expectations and other events or circumstances that are partially dependent on future events are forward-looking statements. These statements are not guarantees of future performance and involve risks, uncertainties and assumptions that are difficult to predict. Aegon undertakes no obligation, and expressly disclaims any duty, to publicly update or revise any forward-looking statements. Readers are cautioned not to place undue reliance on these forward-looking statements, which merely reflect company expectations at the time of writing. Actual results may differ materially and adversely from expectations conveyed in forward-looking statements due to changes caused by various risks and uncertainties. Such risks and uncertainties include but are not limited to the following:

• Unexpected delays, difficulties, and expenses in executing against Aegon’s environmental, climate, diversity and inclusion or other “ESG” targets, goals and commitments, and changes in laws or regulations affecting us, such as changes in data privacy, environmental, safety and health laws;
• Changes in general economic and/or governmental conditions, particularly in the United States, the Netherlands and the United Kingdom;
• Civil unrest, (geo-) political tensions, military action or other instability in a country or geographic region;
• Changes in the performance of financial markets, including emerging markets, such as with regard to:         
  • The frequency and severity of defaults by issuers in Aegon’s fixed income investment portfolios;
  • The effects of corporate bankruptcies and/or accounting restatements on the financial markets and the resulting decline in the value of equity and debt securities Aegon holds;
  • The effects of declining creditworthiness of certain public sector securities and the resulting decline in the value of government exposure that Aegon holds;
  • The impact from volatility in credit, equity, and interest rates;
• Changes in the performance of Aegon’s investment portfolio and decline in ratings of Aegon’s counterparties;
• Lowering of one or more of Aegon’s debt ratings issued by recognized rating organizations and the adverse impact such action may have on Aegon’s ability to raise capital and on its liquidity and financial condition;
• Lowering of one or more of insurer financial strength ratings of Aegon’s insurance subsidiaries and the adverse impact such action may have on the written premium, policy retention, profitability and liquidity of its insurance subsidiaries;
• The effect of the European Union’s Solvency II requirements, applicable equivalent solvency requirements and other regulations in other jurisdictions affecting the capital Aegon is required to maintain;
• Changes affecting interest rate levels and low or rapidly changing interest rate levels;
• Changes affecting currency exchange rates, in particular the EUR/USD and EUR/GBP exchange rates;
• Changes affecting inflation levels, particularly in the United States, the Netherlands and the United Kingdom;
• Changes in the availability of, and costs associated with, liquidity sources such as bank and capital markets funding, as well as conditions in the credit markets in general such as changes in borrower and counterparty creditworthiness;
• Increasing levels of competition, particularly in the United States, the Netherlands, the United Kingdom and emerging markets;
• Catastrophic events, either manmade or by nature, including by way of example acts of God, acts of terrorism, acts of war and pandemics, could result in material losses and significantly interrupt Aegon’s business;
• The frequency and severity of insured loss events;
• Changes affecting longevity, mortality, morbidity, persistence and other factors that may impact the profitability of Aegon’s insurance products;
• Aegon’s projected results are highly sensitive to complex mathematical models of financial markets, mortality, longevity, and other dynamic systems subject to shocks and unpredictable volatility. Should assumptions to these models later prove incorrect, or should errors in those models escape the controls in place to detect them, future performance will vary from projected results;
• Reinsurers to whom Aegon has ceded significant underwriting risks may fail to meet their obligations;
• Changes in customer behavior and public opinion in general related to, among other things, the type of products Aegon sells, including legal, regulatory or commercial necessity to meet changing customer expectations;
• Customer responsiveness to both new products and distribution channels;
• Third-party information used by us may prove to be inaccurate and change over time as methodologies and data availability and quality continue to evolve impacting our results and disclosures;
• As Aegon’s operations support complex transactions and are highly dependent on the proper functioning of information technology, operational risks such as system disruptions or failures, security or data privacy breaches, cyberattacks, human error, failure to safeguard personally identifiable information, changes in operational practices or inadequate controls including with respect to third parties with which Aegon does business may disrupt Aegon’s business, damage its reputation and adversely affect its results of operations, financial condition and cash flows;
• The impact of acquisitions and divestitures, restructurings, product withdrawals and other unusual items, including Aegon’s ability to complete, or obtain regulatory approval for, acquisitions and divestitures, integrate acquisitions, and realize anticipated results, and its ability to separate businesses as part of divestitures;
• Aegon’s failure to achieve anticipated levels of earnings or operational efficiencies, as well as other management initiatives related to cost savings, Cash Capital at Holding, gross financial leverage and free cash flow;
• Changes in the policies of central banks and/or governments;
• Litigation or regulatory action that could require Aegon to pay significant damages or change the way Aegon does business;
• Competitive, legal, regulatory, or tax changes that affect profitability, the distribution cost of or demand for Aegon’s products;
• Consequences of an actual or potential break-up of the European monetary union in whole or in part, or the exit of the United Kingdom from the European Union and potential consequences if other European Union countries leave the European Union;
• Changes in laws and regulations, particularly those affecting Aegon’s operations’ ability to hire and retain key personnel, taxation of Aegon companies, the products Aegon sells, and the attractiveness of certain products to its consumers;
• Regulatory changes relating to the pensions, investment, and insurance industries in the jurisdictions in which Aegon operates;
• Standard setting initiatives of supranational standard setting bodies such as the Financial Stability Board and the International Association of Insurance Supervisors or changes to such standards that may have an impact on regional (such as EU), national or US federal or state level financial regulation or the application thereof to Aegon, including the designation of Aegon by the Financial Stability Board as a Global Systemically Important Insurer (G-SII);
• Changes in accounting regulations and policies or a change by Aegon in applying such regulations and policies, voluntarily or otherwise, which may affect Aegon’s reported results, shareholders’ equity or regulatory capital adequacy levels;
• Changes in ESG standards and requirements, including assumptions, methodology and materiality, or a change by Aegon in applying such standards and requirements, voluntarily or otherwise, may affect Aegon’s ability to meet evolving standards and requirements, or Aegon’s ability to meet its sustainability and ESG-related goals, or related public expectations; and
• Reliance on third-party information in certain of Aegon’s disclosures, which may change over time as methodologies and data availability and quality continue to evolve. These factors, as well as any inaccuracies in third-party information used by Aegon, including in estimates or assumptions, may cause results to differ materially and adversely from statements, estimates, and beliefs made by Aegon or third-parties. Moreover, Aegon’s disclosures based on any standards may change due to revisions in framework requirements, availability of information, changes in its business or applicable governmental policies, or other factors, some of which may be beyond Aegon’s control. Additionally, Aegon may provide information that is not necessarily material for SEC reporting purposes but that is informed by various ESG standards and frameworks (including standards for the measurement of underlying data), internal controls, and assumptions or third-party information that are still evolving and subject to change.

This document contains information that qualifies, or may qualify, as inside information within the meaning of Article 7(1) of the EU Market Abuse Regulation (596/2014). Further details of potential risks and uncertainties affecting Aegon are described in its filings with the Netherlands Authority for the Financial Markets and the US Securities and Exchange Commission, including the [2022 Integrated] Annual Report. These forward-looking statements speak only as of the date of this document. Except as required by any applicable law or regulation, Aegon expressly disclaims any obligation or undertaking to release publicly any updates or revisions to any forward-looking statements contained herein to reflect any change in Aegon’s expectations with regard thereto or any change in events, conditions or circumstances on which any such statement is based.

World Financial Group (WFG)WFG consists of:In the United States, World Financial Group Insurance Agency, LLC (in California, doing business as World Financial Insurance Agency, LLC), World Financial Group Insurance Agency of Hawaii, Inc., World Financial Group Insurance Agency of Massachusetts, Inc., and / or WFG Insurance Agency of Puerto Rico, Inc. (collectively WFGIA), which offer insurance and annuity products. In the United States, Transamerica Financial Advisors, Inc. is a full-service, fully licensed, independent broker-dealer and registered investment advisor. Transamerica Financial Advisors, Inc. (TFA), Member  FINRA, MSRB, SIPC , and registered investment advisor, offers securities and investment advisory services. In Canada, World Financial Group Insurance Agency of Canada Inc. (WFGIAC), which offers life insurance and segregated funds. WFG Securities Inc. (WFGS), which offers mutual funds. WFGIAC and WFGS are affiliated companies.

Attachment

• 20230817_PR_Aegon reports first half year 2023 results

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