Financial performance

Throughout 2009, AEGON saw a steady improvement in its quarterly earnings. However, annual earnings figures were adversely affected by losses sustained during the first three months of the year. Part of the increase in earnings during the year was due to a substantial improvement in market conditions after the end of the first quarter. Measures designed to reduce costs, lower financial risk and free up capital from existing businesses, meanwhile, further strengthened AEGON's financial position.

Underlying earnings before tax declined 26% in 2009 to EUR 1.2 billion, a reflection primarily of lower investment income, higher employee benefit expenses and a decline in fee income.

Net income totaled EUR 204 million, compared with a loss for 2008 of nearly EUR 1.1 billion. Most of the turnaround was attributable to an improvement in world financial markets during the year. Impairments showed a steady improvement during the year, but remained above long-term expectations.  

New life sales, at EUR 2.0 billion, remained strong despite difficult market conditions. Gross deposits rose 6% during the year to EUR 23.6 billion, while AEGON's value of new business - a key measure of future profitability - was down just 8% at EUR 767 million.

AEGON's capital position remained strong, with excess capital above AA capital adequacy requirements, totaling EUR 3.7 billion at the end of 2009. AEGON's core capital rose significantly to EUR 14.2 billion. 

Revenue-generating investments rose 9% to EUR 361 billion, a reflection of new business growth and stronger financial markets. 

Figures have been rounded

Figures in parentheses denote losses

[1] The figure for 2009 includes AEGON's repayment in November 2009 of EUR 1 billion to the Dutch State, one-third of the EUR 3 billion in additional core capital provided to the company at the height of the financial crisis.