Welcome to the Annual General Meeting of Shareholders AEGON N.V. - PowerPoint PPT Presentation

Welcome to the Annual General Meeting of Shareholders AEGON N.V. Welkom op de jaarlijkse Algemene Vergadering van Aandeelhouders AEGON N.V. In order to hear a simultaneous translation into English, we would like to offer you the use of a headset. Please, choose channel 4 . Voor het beluisteren van een simultaanvertaling in het Nederlands kunt u gebruikmaken van een koptelefoon. Kies hiervoor kanaal 3 . Local knowledge. Global power. 1

Dudley Eustace Chairman Supervisory Board Voorzitter Raad van Commissarissen Local knowledge. Global power. 2

Agenda Agenda item 1 / Agendapunt 1 Opening Local knowledge. Global power. 3

Agenda Agenda item 2 / Agendapunt 2 Presentation on the course of business and significant events in 2008 Presentatie over de gang van zaken en belangrijke gebeurtenissen in 2008 Local knowledge. Global power. 4

Course of business and significant events in 2008 Alex Wynaendts, CEO & Chairman of the Executive Board Local knowledge. Global power. 5

Strategy update June 2008 Strategic priorities to improve performance Reallocate capital towards businesses with higher growth and 1 return prospects 2 Improve growth and returns from existing businesses 3 Manage AEGON as an international group Local knowledge. Global power. 6

Refocus towards businesses with higher growth and return prospects Capital allocation 5-10% Global businesses 10% 10% New markets* 15-25% 30% 35% 25-35% Western Europe 40-50% US 60% 40-50% 60% 55% 2007 2008 Target allocation 2012 * New markets = Central & Eastern Europe, Asia and Latin America Local knowledge. Global power. 7

Global financial turmoil affected the economy Total US credit market debt/GDP 3 (%) GDP growth expectations for 2009 1 (EUR million) � US � Euro zone 350 1.0% � UK 300 250 -1.0% 200 150 -3.0% 100 Jun Jul Aug Sep Oct Nov Dec Jan Feb 1925 1930 1935 1940 1945 1950 1955 1960 1965 1970 1975 1980 1985 1990 1995 2000 2005 2009 08 08 08 08 08 08 08 09 09 Equity markets 2 Credit spread gapping 2 Indexed level (December 31, 2002=100) Average corporate bond yields (%) 10 Y Treasury S&P 500 AAA AEX (Amsterdam) 8.0 AA 180 BBB FTSE 100 160 140 6.0 120 100 4.0 80 60 40 2.0 2003 2004 2005 2006 2007 2008 2009 Dec/02 Dec/03 Dec/04 Dec/05 Dec/06 Dec/07 Dec/08 1. Source: Consensus Economics Inc. 2008 2. Bloomberg 3. Total US credit market debt measured by the US Federal Reserve includes debt owed by domestic financial services firms, mortgages, corporate debt, federal government debt, small business debt, consumer debt, state and local government debt, and foreign debt Local knowledge. Global power. 8

Strong capital buffer required Financial markets o Volatility o Illiquidity Increased cost of capital & Maintaining less availability of capital o Closed capital markets strong capital Regulators buffer o Focus on capital remains key o Take a more Fungibility of capital restricted conservative stance Customers o Demand for guarantees Increase of required capital o Trust Local knowledge. Global power. 9

Execution of strategy under difficult circumstances CAPITAL FOCUS COST CONTINGENCY BUSINESS REVIEW Local knowledge. Global power. 10

Capital: EUR 1.7 billion of capital released in 2008 Americas United Kingdom o Transferring risk through reinsurance o Active risk reduction and o ViF securitization diversification: o Further improvements ALM – Investment risks – Optimization of asset and liability Netherlands management o Sale of risky investments – Securitization – Reinsurance transactions Other countries o Reinsurance of non-life catastrophic risk EUR 1.7 billion of capital released in 2008 through capital preservation and de-risking measures Local knowledge. Global power. 11

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 headcount reduction of ~560 services o Additional savings at various divisions o Headcount reduction of ~110 o Limited salary increases o Savings in distribution Netherlands o Return to 2007 cost base Other countries o Restructuring program in the o Cost containment but room for distribution business growth o Reduction in number of contract services o Limited salary increases Local knowledge. Global power. 12

Contingency: EUR 3 billion additional core capital structure Capital facility EUR 3 billion Public Market Vereniging AEGON Dutch State EUR ~89% of ~11% of 100% of EUR Non-voting securities common common preferred EUR 3 billion shares shares shares AEGON N.V. Local knowledge. Global power. 13

Contingency: EUR 3 billion additional core capital structure o Dutch State representation on AEGON Supervisory Board - Two seats granted - Formal appointment by Annual General Meeting of Shareholders - Membership of Audit, Compensation and Nominating Committees o State representatives approval required on certain decisions o AEGON maintains full discretion to determine dividend on common shares Local knowledge. Global power. 14

Business review: continuous assessment of business mix US Netherlands o Sale of real estate brokerage o New organizational structure o Downsizing of institutional spread based balances in the US o Closing down of car credit insurance o Merger of broker-dealers Canada o Strategic refocus of Canadian business Measures taken in line with long term strategy Local knowledge. Global power. 15

Despite market turmoil continued focus on execution of strategy o Enhanced position in pension markets Hungary and Poland o First step in fast-developing Turkish life insurance and pension market o Expanded footprint in Latin America with Brazilian life insurance joint venture o Presence in Spanish bank distribution channel extended o Continued roll-out across highly developed coastal provinces and new asset management joint venture in China o Launch of India life insurance and pension business Local knowledge. Global power. 16

Remuneration Alex Wynaendts, CEO & Chairman of the Executive Board Leo van Wijk, Chairman Compensation Committee of the Supervisory Board Local knowledge. Global power. 17

Remuneration AEGON o Salary freeze for senior management (except for CAO increase in The Netherlands) o Cancellation of worldwide stock option program for all employees, including management o 2008 total variable compensation ~30% below 2007 levels (EUR 75 mln vs. EUR 105 mln) o Variable remuneration of senior management restrained as much as possible in 2009 until a new remuneration policy is in place o New remuneration policy to be implemented for senior management in 2010, in line with new Executive Board policy Local knowledge. Global power. 18

Remuneration AEGON Executive Board o No variable compensation over the year 2008 o No increase of fixed base salaries in 2009 o No variable compensation over the year 2009 o Severance payments limited to 1 year fixed base salary o Development of new remuneration policy, to be submitted to the AGM in 2010 o Base salary Jan Nooitgedagt EUR 700,000 gross per year o No sign-on bonus o Defined contribution pension plan to which AEGON will contribute 25% of fixed salary Local knowledge. Global power. 19

Agenda Agenda item 2 / Agendapunt 2 Presentation on the course of business and significant events in 2008 Presentatie over de gang van zaken en belangrijke gebeurtenissen in 2008 Local knowledge. Global power. 20

Agenda Agenda item 3 / Agendapunt 3 Annual Report 2008 and Annual Accounts 2008: Proposal to adopt the Annual Accounts 2008 Jaarverslag 2008 en Jaarrekening 2008: Voorstel tot vaststelling van de Jaarrekening 2008 Local knowledge. Global power. 21

22 Jos Streppel, Chief Financial Officer Full year 2008 results Local knowledge. Global power.

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 336% 350% NAIC RBC ratio AEGON’s IGD ratio of 183% compares well with the average for European peers of 144%** * The calculation of the IGD (Insurance Group Directive) capital surplus and ratio have been changed from the disclosure in the previous year to better reflect regulatory solvency requirements of local regulators and are based on Solvency I capital requirements on IFRS for entities within the EU, and local regulatory solvency measurements for non-EU entities. Specifically, required capital for the life insurance companies in the US is calculated as two times the upper end of the Company Action Level range (200%) as applied by the National Association of Insurance Commissioners in the US. ** Peers include AXA, Aviva, Allianz, CNP, Swiss Life, Prudential plc, Zurich Financial Local knowledge. Global power. 23