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    Michael Huttner • Berenberg

    Michael Huttner's questions to Aegon Ltd (AEG) leadership

    Michael Huttner's questions to Aegon Ltd (AEG) leadership • H1 2025

    Question

    Michael Huttner of Berenberg asked about the implications of starting U.S. GAAP preparations, the size of a specific large 'pool plan' deposit, details on new business strain, and the capital benefit from the new VA hedge. In a follow-up, he inquired about the specifics of the unfavorable U.S. mortality claims experience.

    Answer

    CEO Lard Friese confirmed the large pool plan deposit in the retirement business was €1.9 billion. CFO Duncan Russell stated it was too early to guide on the impact of a U.S. GAAP transition and noted the capital benefit from the new VA hedge would be small. Regarding new business strain, he said it was roughly €6 million higher than the guided run rate. On mortality, Mr. Russell clarified that the overall U.S. mortality experience in Q2 was slightly positive and in line with best estimates, expressing comfort with their assumptions.

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    Michael Huttner's questions to Aegon Ltd (AEG) leadership • H2 2024

    Question

    Michael Huttner inquired about the current solvency ratio in China, the potential impact of using spot interest rates, and the risk of a capital injection. He also asked for key metrics to track improving US mortality trends.

    Answer

    CFO Duncan Russell stated that China's Q4 comprehensive solvency ratio was 228%, well above the regulatory threshold. He acknowledged a drag on OCG from amortizing the difference between the regulatory and market interest rate curves but noted they are exploring management actions. For mortality, he advised focusing on IFRS experience variances, which were positive in H2 2024.

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    Michael Huttner's questions to Aegon Ltd (AEG) leadership • Q3 2024

    Question

    Michael Huttner from Berenberg Bank questioned the mechanics of reducing cash capital to the €1 billion midpoint by 2026, asking if it implies a straightforward €600 million in buybacks. He also inquired about the portion of the new buyback allocated to share-based compensation and requested a breakdown of capital allocated to financial assets like universal life and variable annuities.

    Answer

    CFO Duncan Russell clarified that the reduction to the cash capital midpoint by 2026 will follow the capital management framework, considering deleveraging (unlikely), strategic investments, or shareholder returns. He specified that approximately €40 million of the new buyback is for share-based compensation. He also detailed the capital allocation in financial assets, noting Long-Term Care is the largest at $1.2B, while Variable Annuities has reduced to the smallest at $500M.

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    Michael Huttner's questions to Aegon Ltd (AEG) leadership • H1 2024

    Question

    Michael Huttner from Berenberg sought clarification on the large-claims mortality miss, asking if it's recurring noise and how it relates to the buyback of institutionally owned policies. He also asked if there's a structural offset where negative mortality is balanced by positive reserve releases in long-term care (LTC).

    Answer

    CFO Matt Rider acknowledged that mortality volatility will continue but stated the recent assumption update should reduce it going forward. He attributed the H1 miss to an unusual number of high face-amount claims. He clarified there is no direct offset with LTC; assumption updates in the UL book (which is onerous) hit the P&L, while in the LTC book (which has a large CSM), they are largely absorbed by the CSM.

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