United Kingdom - Underlying earnings before tax declined 39% on
lower fund related charges in the pension business - New life sales
in line with last year; sales of annuities rise to record levels,
up 4% at GBP 49 million - Higher margins lead to further increase
in UK's value of new business Overview Lower corporate bond and
equity markets led to a decline in earnings from the United
Kingdom. New life sales held up well with annuities enjoying a
record quarter. Value of new business also continued its recent
strong growth, helped by a further improvement in margins during
the third quarter. Underlying earnings before tax Underlying
earnings before tax declined 39% in the third quarter to GBP 28
million, due primarily to the impact of lower equity and corporate
bond markets on fund related charges in AEGON's unit linked pension
business. - Earnings from Life & Protection decreased 25% to
GBP 9 million as strong underlying growth was offset by an increase
in expenses. - Earnings from Pensions & Asset Management were
34% lower, the result mainly of lower fund related charges. -
Distribution activities saw a decline in earnings because of lower
income from investment products and housing related sales. Net
income Net income declined 61% to GBP 15 million in the third
quarter, as a result of investment losses on bond sales and
impairment charges arising from the collapse of US investment bank
Lehman Brothers. AEGON did, however, benefit from a tax credit
related to previous impairment charges. Commissions and expenses
Total commissions and expenses were down 2%. Operating expenses
meanwhile increased by 5% to GBP 100 million, due to investment in
the business and higher employee pension expenses. Sales and
deposits Overall, new life sales were broadly in line with the
third quarter 2007, up 1% at GBP 303 million. Sales of annuities
and group pensions were strong, though individual pensions weakened
from their year-earlier levels. - Sales of annuities reached a
record level, rising 4% in the third quarter to GBP 49 million
annualized premium production, as AEGON continued its focus on the
rapidly-growing at-retirement market. - Individual pensions saw a
decline following strong sales last year - the result of
exceptional activity following the UK's 'Pension A-day' in May
2006. Group pensions, meanwhile continued the growth trend. -
Recent difficult conditions in world financial markets resulted in
lower sales of retail mutual funds and third party managed assets
as investors delayed investment decisions. Value of new business
Value of new business increased 13% to GBP 45 million, as margins
showed further improvement in the third quarter. AEGON's strategy
in the United Kingdom is to move more of its business to
high-margin areas, such as annuities. As a result, the internal
rate of return on new business in the United Kingdom rose during
the quarter from 12.8% to 13.6%. Please refer to page 29 for more
detailed information on VNB. Revenue generating investments At the
end of September 2008, revenue generating investments totaled GBP
47.6 billion, a decline of 6% from GBP 50.5 billion three months
earlier. The decrease reflects the recent weakness in world
financial markets. UNITED KINGDOM - EARNINGS Q3 Q3 Ytd Ytd GBP
millions Notes 2008 2007 % 2008 2007 % Underlying earnings before
tax by line of business *) Life 9 12 (25) 28 32 (13) Life and
protection 9 12 (25) 28 32 (13) Pensions and asset management 21 32
(34) 76 102 (25) Distribution (2) 1 N.M. (4) 3 N.M. Share in net
results of associates 0 1 N.M. 0 1 N.M. Underlying earnings before
tax 28 46 (39) 100 138 (28) Gains/(losses) on investments (3) (1)
(200) (1) (6) 83 Impairment charges (11) (1) N.M. (20) (1) N.M.
Other income/(charges) 9 (7) 8 N.M. (42) 23 N.M. Income before tax
7 52 (87) 37 154 (76) Income tax attributable to policyholder
return 7 (8) N.M. 42 (23) N.M. Income before income tax on
shareholders return 14 44 (68) 79 131 (40) Income tax on
shareholders return 1 (6) N.M. (7) 8 N.M. Net income 15 38 (61) 72
139 (48) Net underlying earnings 26 40 (35) 87 145 (40) Net
operating earnings 26 40 (35) 87 145 (40) Commissions and expenses
160 164 (2) 489 470 4 of which operating expenses 100 95 5 300 282
6 *) In the United Kingdom, underlying earnings equals operating
earnings. For the amounts in euro see the Financial Supplement.
UNITED KINGDOM - SALES Q3 Q3 Ytd Ytd GBP millions Notes 2008 2007 %
2008 2007 % New life sales 10 Life single premiums 1,696 1,838 (8)
4,922 5,429 (9) Life recurring premiums annualized 134 118 14 441
364 21 Total recurring plus 1/10 single 303 302 0 933 907 3 Life 71
67 6 185 161 15 Pensions 232 235 (1) 748 746 0 Total recurring plus
1/10 single 303 302 0 933 907 3 Gross deposits (on and off balance)
by line of business Pensions and asset management 86 183 (53) 390
560 (30) Total gross deposits 86 183 (53) 390 560 (30) Net deposits
(on and off balance) by line of business Pensions and asset
management (85) 20 N.M. (333) 138 N.M. Total net deposits (85) 20
N.M. (333) 138 N.M. REVENUE GENERATING INVESTMENTS At Sep. At June
30 30 Notes 2008 2008 % Revenue generating investments (total) 6
47,565 50,508 (6) Investments general account 4,678 4,406 6
Investments for account of policyholders 40,587 43,592 (7) Off
balance sheet investments third parties 2,300 2,510 (8) For the
amounts in euro see the Financial Supplement. Other Countries -
Underlying earnings before tax declined 24% to EUR 42 million -
Core businesses perform well, despite troubled financial
environment - Pension business in Central & Eastern Europe
shows continued growth; pension fund members top 2 million -
Deposits up strongly on new asset management joint venture in China
Overview Other countries' core businesses - Pensions & Asset
Management and Life & Protection - performed well in the third
quarter, but earnings were affected by continued volatility in
world financial markets. Deposits rose sharply as a result of the
inclusion of AEGON's new asset management joint venture in China,
an increase in variable annuity deposits in Taiwan as well as
continued strong growth in the company's pension business in
Central & Eastern Europe. Life sales were 47% lower, primarily
because of uncertainty over equity markets and a shift in business
mix in Taiwan. As a result, value of new business was also down.
Underlying earnings before tax Underlying earnings before tax from
Other countries declined 24% to EUR 42 million in the third
quarter. - Earnings from Other countries' two core businesses -
Pensions & Asset Management and Life & Protection - held up
well, despite the difficult financial environment. - The inclusion
of AEGON's new asset management joint venture in China boosted
earnings from mutual funds. - Earnings from General Insurance,
however, were lower because of higher claims payments and reserve
strengthening in Hungary following severe storms during the summer.
- Earnings from associate companies also declined as a result of: -
Impairment charges at CAM, AEGON's Spanish associate, related to
the bankruptcy of US investment bank Lehman Brothers. - Additional
start-up costs at AEGON's new life insurance joint venture in
India. - Lower contribution from La Mondiale, AEGON's French
partner. Net income Net income was sharply lower in the third
quarter, down 80% at EUR 9 million. This was primarily the result
of impairments related to Lehman Brothers and Washington Mutual, as
well as losses on certain derivative products. Commissions and
expenses Commission and expenses rose 38% in the third quarter to
EUR 112 million. - Operating expenses increased 20% as a result of
continued growth in AEGON's pension business in Central &
Eastern Europe and further Investment in the company's bank
distribution operations in Spain. - Commissions, meanwhile, were
down 9%. - Amortization of DAC - deferred acquisition costs - rose
mainly as a result of higher surrenders in Poland and the
introduction of DAC in the life business in Slovakia. - Deferred
expenses declined, primarily because of lower production in Poland.
Sales New life sales in the third quarter declined 47% to EUR 52
million. - In Central & Eastern Europe, sales of recurring
premium life insurance rose 53% thanks to particularly strong
performances in Poland, the Czech Republic and Slovakia. Single
premium sales in Poland were sharply lower, however, because of
increased equity market volatility. Total new life sales in Central
& Eastern Europe amounted to EUR 27 million, down 21%. - In
Spain, sales of life insurance rose to EUR 14 million, due
primarily to the extraordinary activity in AEGON's Spanish life
business, following changes in pension legislation. - AEGON's
largest bank partner in Spain, which is an associate and therefore
not consolidated, also enjoyed a particularly strong quarter, with
sales of EUR 41 million (on a 100% basis), up 57% compared to last
year. - In Asia, new life sales decreased to EUR 12 million as a
result of significantly lower equity markets and the ongoing shift
in sales from traditional to unit-linked products. In China, sales
declined because of the adverse impact of last summer's Olympic
Games and continued equity market volatility. General insurance
Non-life sales in Hungary more than doubled from their year-ago
levels to EUR 13 million. Deposits Gross deposits rose 132% in the
third quarter to EUR 474 million. Net deposits were down 17% at EUR
113 million. The increase in deposits reflects: - The inclusion of
AEGON's new asset management joint venture in China. - Strong
growth in the company's pension business in Central & Eastern
Europe. The number of pension fund members across the region at the
end Of the quarter is over 2 million. - Higher variable annuity
deposits in Taiwan. Value of new business VNB from Other countries
decreased to EUR 32 million primarily as a result of lower sales.
In Asia, the decrease in VNB was due largely to lower production
and a change in product mix in Taiwan. In Central & Eastern
Europe, VNB was down 5% as sales of single premium unit-linked
policies in Poland continued to be adversely affected by weak
equity markets. In Spain, VNB decreased mainly to lower margins.
Please refer to page 29 for more detailed VNB information. Revenue
generating investments At the end of September, revenue generating
investments totaled EUR 14.2 billion, up from EUR 14.0 billion
three months before. OTHER COUNTRIES - EARNINGS Q3 Q3 Ytd Ytd EUR
millions Notes 2008 2007 % 2008 2007 % Underlying earnings before
tax by line of business *) Life 29 30 (3) 52 48 8 Accident and
health 1 2 (50) 4 4 0 Life and protection 30 32 (6) 56 52 8
Variable annuities 0 0 N.M. (1) 0 N.M. Saving products (1) 0 N.M. 0
(1) N.M. Retail mutual funds 5 1 N.M. 10 2 N.M. Individual savings
and retirement products 4 1 N.M 9 1 N.M. Pensions and asset
management 4 3 33 10 12 (17) General insurance 7 11 (36) 25 31 (19)
Share in net results of associates (3) 8 N.M. 10 24 (58) Underlying
earnings before tax 42 55 (24) 110 120 (8) Gains/(losses) on
investments (5) 8 N.M. 0 13 N.M. Impairment charges (18) 0 N.M.
(19) 0 N.M. Other income/(charges) 0 (1) N.M. 0 (1) N.M. Income
before tax 19 62 (69) 91 132 (31) Income tax (10) (16) 38 (34) (51)
33 Net income 9 46 (80) 57 81 (30) Net underlying earnings 30 39
(23) 74 70 6 Net operating earnings 30 39 (23) 74 70 6 Commissions
and expenses 112 81 38 319 251 27 of which operating expenses 53 44
20 145 125 16 *) In Other countries, underlying earnings equals
operating earnings. OTHER COUNTRIES - SALES Q3 Q3 Ytd Ytd EUR
millions Notes 2008 2007 % 2008 2007 % New life sales 10 Life
single premiums 83 293 (72) 376 814 (54) Life recurring premiums
annualized 43 69 (38) 137 183 (25) Total recurring plus 1/10 single
52 99 (47) 175 265 (34) Life 52 99 (47) 174 264 (34) Saving
products 0 0 N.M. 1 1 0 Total recurring plus 1/10 single 52 99 (47)
175 265 (34) New premium production accident and health insurance 1
2 (50) 4 5 (20) New premium production general insurance 13 6 117
30 17 76 Gross deposits (on and off balance) Variable annuities 34
1 N.M. 116 4 N.M. Retail mutual funds 218 50 N.M. 606 111 N.M.
Pensions and asset management 222 153 45 526 417 26 Total gross
deposits 474 204 132 1,248 532 135 Net deposits (on and off
balance) Variable annuities 31 1 N.M. 108 3 N.M. Retail mutual
funds (1) 37 N.M. 115 75 53 Pensions and asset management 83 98
(15) 256 285 (10) Total net deposits 113 136 (17) 479 363 32
REVENUE GENERATING INVESTMENTS At Sep. At June 30 30 Notes 2008
2008 % Revenue generating investments (total) 6 14,154 13,995 1
Investments general account 5,399 5,086 6 Investments for account
of policyholders 2,600 2,732 (5) Off balance sheet investments
third parties 6,155 6,177 (0) Appendix II - Tables NET UNDERLYING
EARNINGS GEOGRAPHICALLY Q3 Q3 Ytd Ytd EUR millions Notes 2008 2007
% 2008 2007 % Americas 266 357 (25) 935 1,077 (13) The Netherlands
62 94 (34) 246 243 1 United Kingdom 33 58 (43) 112 214 (48) Other
countries 30 39 (23) 74 70 6 Holding and other (28) (17) (65) (64)
(87) 26 Net underlying earnings 363 531 (32) 1,303 1,517 (14)
OVER/UNDER PERFORMANCE OF FAIR VALUE ITEMS EUR millions Operating
earnings before tax 116 673 (83) 1,116 2,056 (46) (Over)/under
performance of fair value items - Americas 453 (9) N.M. 727 (106)
N.M. (Over)/under performance of fair value items - The Netherlands
54 27 100 106 22 N.M. (Over)/under performance of fair value items
- Holding and other (123) - N.M. (195) - N.M. Underlying earnings
before tax 500 691 (28) 1,754 1,972 (11) Net underlying earnings
363 531 (32) 1,303 1,517 (14) AMERICAS - OVER/UNDER PERFORMANCE OF
FAIR VALUE ITEMS USD millions Over/(under) performance of fair
value items by line of business Life and protection (96) 14 N.M.
(104) 43 N.M. Individual savings and retirement products (235) 27
N.M. (466) 53 N.M. Pensions and asset management (22) 3 N.M. (25)
11 N.M. Institutional products (204) (33) N.M. (368) 12 N.M. Life
reinsurance (128) 2 N.M. (141) 23 N.M. Total over/(under)
performance of fair value items (685) 13 N.M.(1,104) 142 N.M. Total
over/(under) performance of fair value items in EUR (453) 9 N.M.
(727) 106 N.M. THE NETHERLANDS - OVER/UNDER PERFORMANCE OF FAIR
VALUE ITEMS EUR millions Over/(under) performance of fair value
items by line of business Pensions and asset management (54) (27)
(100) (106) (22) N.M. Total over/(under) performance of fair value
items (54) (27) (100) (106) (22) N.M. EXPLANATION Certain assets
held by AEGON Americas and AEGON The Netherlands are carried at
fair value, and managed on a total return basis, with no offsetting
changes in the valuation of related liabilities. These include
assets such as hedge funds, private equities, real estate limited
partnerships, convertible bonds and structured products. Underlying
earnings exclude any over- or underperformance compared to
management's long-term expected return on these assets. Based on
current holdings and asset class returns, the long-term expected
return on an annual basis is 8-10%, depending on the asset class,
including cash income and market value changes. The expected
earnings from these assets classes are net of DPAC where
applicable. In addition, certain products offered by AEGON Americas
contain guarantees and are reported on a fair value basis,
including the segregated funds offered by AEGON Canada and the
total return annuities and guarantees on variable annuities of
AEGON USA. The earnings on these products are impacted by movements
in equity markets and risk free interest rates. Short-term
developments in the financial markets may therefore cause
volatility in earnings. Included in underlying earnings is a
long-term expected return on these products and any over- or
underperformance compared to management's expected return is
excluded from underlying earnings. The Holding includes certain
issued bonds that are held at fair value through profit or loss.
The interest rate risk on these bonds is hedged using swaps. The
change in AEGON's credit spread resulted in a gain of EUR 123 mln
in Q3 2008 on the fair value movement on these bonds. SALES Q3 Q3
Ytd Ytd EUR millions 2008 2007 % 2008 2007 % New life sales 618 847
(27) 2,033 2,474 (18) Gross deposits (on and off balance) 11,051
12,056 (8) 28,818 34,934 (18) New life sales Life single premiums
2,568 3,794 (32) 8,205 10,967 (25) Life recurring premiums
annualized 361 467 (23) 1,212 1,377 (12) Total recurring plus 1/10
single 618 847 (27) 2,033 2,474 (18) Life 272 357 (24) 836 972 (14)
Saving products 0 0 N.M. 1 1 0 Pensions 308 396 (22) 1,058 1,221
(13) BOLI/COLI 1 29 (97) 14 87 (84) Life reinsurance 37 65 (43) 124
193 (36) Total recurring plus 1/10 single 618 847 (27) 2,033 2,474
(18) New premium production accident and health insurance 146 166
(12) 453 502 (10) New premium production general insurance 19 12 58
51 37 38 Gross deposits (on and off balance) Fixed annuities 1,200
363 N.M. 2,381 712 N.M. Variable annuities 644 679 (5) 2,046 2,103
(3) Saving products 547 647 (15) 1,883 1,944 (3) Retail mutual
funds 725 512 42 2,197 1,650 33 Pensions and asset management 2,248
2,861 (21) 7,892 8,946 (12) Institutional guaranteed products 5,687
6,992 (19) 12,417 19,577 (37) Life reinsurance 0 2 N.M. 2 2 0 Total
gross deposits 11,051 12,056 (8) 28,818 34,934 (18) Net deposits
(on and off balance) by line of business Fixed annuities 297 (979)
N.M. (522) (3,629) 86 Variable annuities (73) (123) 41 (327) (439)
26 Saving deposits (206) 22 N.M. (164) 137 N.M. Retail mutual funds
185 141 31 772 531 45 Pensions and asset management 162 690 (77)
1,512 1,446 5 Institutional guaranteed products 1,300 2,965 (56)
506 4,306 (88) Life reinsurance (13) 0 N.M. (42) 0 N.M. Total net
deposits 1,652 2,716 (39) 1,735 2,352 (26) EMPLOYEE NUMBERS At At
At Sep. 30 At Dec. 31 2008 2007 Number of employees 31,888 30,414
VALUE OF NEW BUSINESS AND IRR VNB VNB VNB VNB EUR EUR EUR EUR EUR
millions, Q3 Q3 Ytd Ytd after tax Notes 2008 2007 % 2008 2007 %
Americas 109 109 0 288 321 (10) The Netherlands 8 11 (27) 31 41
(24) United Kingdom 57 58 (2) 174 174 0 Asia 1 24 (96) 15 58 (74)
Central and Eastern Europe 19 20 (5) 60 53 13 Other European
Countries 11 13 (15) 36 55 (35) Total 206 235 (12) 604 702 (14) IRR
% IRR% Americas 12.3 13.7 The Netherlands 11.5 9.8 United Kingdom
13.6 12.8 Asia 15.6 14.7 Central and Eastern Europe 46.8 49.6 Other
European Countries 47.3 37.1 Total 17.7 17.8 MODELED NEW BUSINESS,
APE AND DEPOSITS Premium business Premium business APE APE EUR
millions Notes Q3 2008 Q3 2007 % Ytd 2008 Ytd 2007 % 11 Americas
255 355 (28) 817 977 (16) The Netherlands 55 78 (29) 225 201 12
United Kingdom 371 441 (16) 1,173 1,318 (11) Asia 12 53 (77) 49 127
(61) Central and Eastern Europe 30 35 (14) 83 92 (10) Other
European Countries 46 49 (6) 164 171 (4) Total 769 991 (22) 2,511
2,887 (13) Deposit business Deposit business Deposits Deposits
Americas 8,808 10,569 (17) 21,432 29,463 (27) Asia 6 1 N.M. 20 2
N.M. Central and Eastern Europe 16 7 129 46 18 156 Other European
Countries 1 1 0 10 8 25 Total 8,832 10,578 (17) 21,507 29,491 (27)
VNB/PVNBP SUMMARY Premium business Premium business VNB PVNBP VNB/
VNB/ VNB PVNBP VNB/ VNB/ PVNBP APE PVNBP APE EUR millions Notes Q3
2008 % % Ytd 2008 % % 12 Americas 42 1,248 3.3 16.4 139 4,082 3.4
17.0 The Netherlands 8 389 2.1 15.2 31 1,847 1.7 13.6 United
Kingdom 57 2,621 2.2 15.4 174 8,034 2.2 14.8 Asia 2 59 4.2 20.5 15
278 5.4 30.6 Central and Eastern Europe 14 175 7.8 45.5 39 516 7.5
46.7 Other European Countries 11 347 3.2 23.6 36 1,330 2.7 22.2
Total 134 4,839 2.8 17.5 433 16,087 2.7 17.2 Deposit business
Deposit business VNB PVNBP VNB/ VNB/ VNB PVNBP VNB/ VNB/ PVNBP
Deposits PVNBP Deposits 12 Americas 67 9,819 0.7 0.8 149 24,108 0.6
0.7 Asia (1) 44 (2.3) (17.8) 0 156 0.2 1.7 Central and Eastern
Europe 6 150 3.7 34.1 22 670 3.2 47.3 Other European Countries 0 1
3.6 3.6 0 10 3.3 3.3 Total 72 10,014 0.7 0.8 172 24,943 0.7 0.8
Notes: 1) Certain assets held by AEGON Americas and AEGON The
Netherlands are carried at fair value, and managed on a total
return basis, with no offsetting changes in the valuation of
related liabilities. These include assets such as hedge funds,
private equities, real estate limited partnerships and convertible
bonds. Underlying earnings exclude any over- or underperformance
compared to management's long-term expected return on these assets.
In addition, certain products offered by AEGON Americas contain
guarantees and are reported on a fair value basis, including the
segregated funds offered by AEGON Canada and the total return
annuities and guarantees on variable annuities of AEGON USA. The
earnings on these products are impacted by movements in equity
markets and risk free interest rates. Short-term developments in
the financial markets may therefore cause volatility in earnings.
Included in underlying earnings is a long-term expected return on
these products and any over- or underperformance compared to
management's expected return is excluded from underlying earnings.
The Holding includes certain issued bonds that are held at fair
value through profit or loss. The interest rate risk on these bonds
is hedged using swaps. The change in AEGON's credit spread resulted
in a gain of EUR 123 million in Q3 2008 on the fair value movement
on these bonds. Underlying earnings exclude this amount. 2) Net
income refers to net income attributable to equity holders of AEGON
N.V. 3) New life sales is defined as new recurring premiums + 1/10
of single premiums. 4) Deposits on and off balance sheet. 5) Return
on equity is calculated by dividing the net underlying earnings
after cost of leverage by the average shareholders' equity
excluding the preferred shares and the revaluation reserve. 6) As
of 2008, real estate for own use (both general account and for
account of policyholders) has been reclassified from revenue
generating investments to other assets. 7) Capital securities that
are denominated in foreign currencies are, for purposes of
calculating the capital base ratio, revalued to the period-end
exchange rate. 8) All ratios exclude AEGON's revaluation reserve.
Included in other non-operating income/(charges) are charges made
to 9) policyholders with respect to income tax. There is an equal
and opposite tax charge which is reported in the line Income tax
attributable to policyholder return. Includes production on
investment contracts without a discretionary 10) participation
feature of which the proceeds are not recognized as revenues but
are directly added to our investment contract liabilities. 11) APE
= recurring premium + 1/10 single premium. 12) PVNBP: Present Value
New Business Premium. Appendix III - Financial Information
CONDENSED CONSOLIDATED BALANCE SHEET At Sep. 30 At Dec. 31 2008
2007 % EUR millions Investments general account 131,738 132,861 (1)
Investments for account of policyholders 121,346 142,384 (15)
Investments in associates 497 472 5 Deferred expenses and rebates
12,777 11,488 11 Other assets and receivables 21,435 18,484 16 Cash
and cash equivalents 9,030 8,431 7 Total assets 296,823 314,120 (6)
Shareholders' equity 9,412 15,151 (38) Other equity instruments
4,693 4,795 (2) Minority interest 18 16 13 Group equity 14,123
19,962 (29) Insurance contracts general account 93,070 88,496 5
Insurance contracts for account of policyholders 67,650 78,394 (14)
Investment contracts general account 36,838 36,089 2 Investment
contracts for account of policyholders 54,206 63,756 (15) Other
liabilities 30,936 27,423 13 Total equity and liabilities 296,823
314,120 (6) CAPITAL BASE Group equity 14,123 19,962 (29) Trust
pass-through securities 139 143 (3) Subordinated borrowings 34 34 0
Senior debt related to insurance activities 1,395 1,255 11 Total
capital base 15,691 21,394 (27) CONDENSED CONSOLIDATED INCOME
STATEMENT EUR millions (except per share data) Q3 Q3 Ytd Ytd Notes
2008 2007 % 2008 2007 % Premium income 5,274 6,573 (20) 17,181
20,222 (15) Investment income 2,463 2,648 (7) 7,321 7,824 (6) Fee
and commission income 408 468 (13) 1,266 1,405 (10) Other revenues
1 7 (86) 4 12 (67) Total revenues 8,146 9,696 (16) 25,772 29,463
(13) Income from reinsurance ceded 401 350 15 1,150 1,191 (3)
Results from financial transactions (9,358) 1,536 N.M. (20,566)
5,516 N.M. Other income 5 0 N.M. 5 212 (98) Total income (806)
11,582 N.M. 6,361 36,382 (83) Benefits and expenses (1,074) 10,726
N.M. 5,212 33,507 (84) Impairment charges 444 64 N.M. 579 79 N.M.
Interest charges and related fees 164 118 39 370 325 14 Other
charges 2 0 N.M. 2 181 (99) Total charges (464) 10,908 N.M. 6,163
34,092 (82) Share in net results of associates (1) 8 N.M. 19 25
(24) Income before tax (343) 682 N.M. 217 2,315 (91) Income tax 14
(141)N.M. (117) (412) 72 Net income attributable to equity holders
of AEGON N.V. (329) 541 N.M. 100 1,903 (95) Net income per common
share Basic earnings per share (0.25) 0.31 N.M. (0.10) 1.07 N.M.
Dilluted earnings per share (0.25) 0.31 N.M. (0.10) 1.07 N.M.
CONDENSED CONSOLIDATED STATEMENT OF CHANGES IN EQUITY At Sep. 30 At
Sep. 30 At Dec. 31 2008 2007 2007 EUR millions Notes Shareholders'
equity at January 1 15,151 18,605 18,605 Net income 100 1,903 2,551
Movements in foreign currency translations reserve 129 (904)
(1,445) Movements in revaluation reserves (4,942) (1,571) (2,164)
Total recognized net income for the period (4,713) (572) (1,058)
Dividends paid on ordinary shares (548) (688) (583) Preferred
dividend (112) (85) (85) Repurchased and sold own shares (217)
(666) (1,438) Coupons on perpetuals (net of tax) (140) (124) (175)
Other changes (9) (210) (115) Shareholders' equity at end of period
9,412 16,260 15,151 CONDENSED CONSOLIDATED CASH FLOW STATEMENT Q3
Q3 Ytd Ytd EUR millions Notes 2008 2007 % 2008 2007 % Cash flow
from operating activities (3,005) (5,191) 42 1,774 (2,923) N.M.
Cash flow from investing activities Purchase and disposal of
intangible assets (2) (3) 33 (6) (6) 0 Purchase and disposal of
equipment and other assets (14) (1) N.M. 90 (20) N.M. Purchase,
disposal and dividends of subsidiaries and associates 13 63 (79)
(164) (1,660) 90 (3) 59 N.M. (80) (1,686) 95 Cash flow from
financing activities Issuance and purchase of share capital (142)
(384) 63 (217) (666) 67 Dividends paid (258) (333) 23 (660) (773)
15 Issuance, repayment and coupons of perpetuals (178) 688 N.M.
(301) 577 N.M. Issuance, repayment and finance interest on
borrowings 541 (235) N.M. 720 1,085 (34) (37) (264) 86 (458) 223
N.M. Net increase/(decrease) in cash and cash equivalents (3,045)
(5,396) 44 1,236 (4,386) N.M. AMOUNTS PER COMMON SHARE Q3 Q3 Ytd
Ytd Notes 2008 2007 % 2008 2007 % Net income in EUR 1 (0.25) 0.31
N.M. (0.10) 1.07 N.M. Net income fully diluted in EUR 1 (0.25) 0.31
N.M. (0.10) 1.07 N.M. Net income in USD (0.38) 0.43 N.M. (0.15)
1.44 N.M. Net income fully diluted in USD (0.38) 0.43 N.M. (0.15)
1.44 N.M. Net operating earnings in EUR 1 0.03 0.30 (90) 0.40 0.86
(53) Net operating earnings fully diluted in EUR 1 0.03 0.30 (90)
0.40 0.86 (53) Net operating earnings in USD 0.04 0.42 (90) 0.61
1.16 (47) Net operating earnings fully diluted in USD 0.04 0.42
(90) 0.61 1.16 (47) At At Sep. 30 Dec. 31 2008 2007 Shareholders'
equity in EUR 2 4.82 8.69 (45) Shareholders' equity in USD 2 6.89
12.79 (46) NET INCOME PER COMMON SHARE CALCULATION EUR millions
(except per share data) Q3 Q3 Ytd Ytd Notes 2008 2007 % 2008 2007 %
Net income (329) 541 N.M. 100 1,903 (95) Preferred dividend 0 0
N.M. (112) (85) (32) Coupons on perpetuals (49) (41) (20) (140)
(124) (13) Net income attributable to ordinary shareholders (378)
500 N.M. (152) 1,694 N.M. Weighted average number of common shares
outstanding 1,504 1,576 (5) 1,504 1,576 (5) Net income per share
(0.25) 0.31 N.M. (0.10) 1.07 N.M. Quarterly net income per common
share first quarter 0.07 0.42 (83) 0.07 0.42 (83) second quarter
0.08 0.34 (76) 0.15 0.76 (80) third quarter (0.25) 0.31 N.M. (0.10)
1.07 N.M. fourth quarter 0.40 1.47 SEGMENT REPORTING Q3 Q3 Ytd Ytd
EUR millions Notes 2008 2007 % 2008 2007 % Operating earnings
before tax geographically Americas (65) 517 N.M. 580 1,596 (64) The
Netherlands 20 80 (75) 197 287 (31) United Kingdom 35 67 (48) 128
204 (37) Other countries 42 55 (24) 110 120 (8) Holding and other
activities 78 (45) N.M. 87 (149) N.M. Eliminations 6 (1) N.M. 14
(2) N.M. Total operating earnings before tax 116 673 (83) 1,116
2,056 (46) Revenues geographically Americas 3,218 4,038 (20) 9,701
11,830 (18) The Netherlands 1,419 1,478 (4) 5,202 4,999 4 United
Kingdom 2,957 3,473 (15) 9,148 10,548 (13) Other countries 524 712
(26) 1,656 2,057 (19) Holding and other activities 58 45 29 171 156
10 Eliminations (30) (50) 40 (106) (127) 17 Total revenues 8,146
9,696 (16) 25,772 29,463 (13) Revenues Life insurance gross
premiums 4,664 5,934 (21) 15,205 18,130 (16) Accident and health
insurance 468 515 (9) 1,494 1,647 (9) General insurance 142 124 15
482 445 8 Total gross premiums 5,274 6,573 (20) 17,181 20,222 (15)
Investment income 2,463 2,648 (7) 7,321 7,824 (6) Fee and
commission income 408 468 (13) 1,266 1,405 (10) Other revenues 1 7
(86) 4 12 (67) Total revenues 8,146 9,696 (16) 25,772 29,463 (13)
INVESTMENTS GEOGRAPHICALLY amounts in million EUR (unless otherwise
stated) United The Americas Kingdom United USD GBP At September 30,
2008 Americas Netherlands Kingdom Investments 1,848 43 Shares 1,292
1,679 55 91,368 4,630 Bonds 63,880 17,374 5,859 19,164 5 Loans
13,399 10,201 6 14,017 0 Other financial assets 9,800 108 0 733 0
Investments in real estate 512 2,093 0 127,130 4,678 Investments
general account 88,883 31,455 5,920 0 18,342 Shares 0 8,010 23,209
0 12,531 Bonds 0 10,397 15,855 68,420 2,332 Separate accounts and
47,836 0 2,951 investment funds 0 6,039 Other financial assets 0
1,159 7,641 0 1,343 Investments in real estate 0 0 1,700 68,420
40,587 Investments for account of 47,836 19,566 51,356
policyholders 195,550 45,265 Investments on 136,719 51,021 57,276
balance sheet 109,156 2,300 Off balance sheet 76,317 12,289 2,911
investments third parties 304,706 47,565 Total revenue generating
213,036 63,310 60,187 investments *) Investments 99,238 4,569
Available-for-sale 69,382 18,329 5,782 19,164 5 Loans 13,399 10,201
6 0 0 Held-to-maturity 0 0 0 76,415 39,348 Financial assets at fair
53,426 20,398 49,788 value through profit or loss 733 1,343
Investments in real estate 512 2,093 1,700 195,550 45,265 Total
investments 136,719 51,021 57,276 on balance sheet Table cont.
INVESTMENTS GEOGRAPHICALLY amounts in million EUR (unless otherwise
stated) Holding, other Other activities & Total At September
30, 2008 countries eliminations EUR Investments Shares 181 57 3,264
Bonds 4,381 24 91,518 Loans 728 0 24,334 Other financial assets 109
0 10,017 Investments in real estate 0 0 2,605 Investments general
account 5,399 81 131,738 Shares 211 (12) 31,418 Bonds 327 0 26,579
Separate accounts and 1,907 0 52,694 investment funds Other
financial assets 155 0 8,955 Investments in real estate 0 0 1,700
Investments for account of 2,600 (12) 121,346 policyholders
Investments on 7,999 69 253,084 balance sheet Off balance sheet
6,155 0 97,672 investments third parties Total revenue generating
14,154 69 350,756 investments *) Investments Available-for-sale
2,351 84 95,928 Loans 728 0 24,334 Held-to-maturity 2,246 0 2,246
Financial assets at fair 2,674 (15) 126,271 value through profit or
loss Investments in real estate 0 0 4,305 Total investments 7,999
69 253,084 on balance sheet INVESTMENTS GEOGRAPHICALLY amounts in
million EUR (unless otherwise stated) United The Americas Kingdom
United USD GBP At December 31, 2007 Americas Netherlands Kingdom
Investments 2,386 48 Shares 1,621 1,997 66 98,834 4,104 Bonds
67,138 18,225 5,595 19,813 5 Loans 13,459 8,517 7 12,890 0 Other
financial 8,756 66 0 assets 755 0 Investments in 513 2,008 0 real
estate 134,678 4,157 Investments 91,487 30,813 5,668 general
account 0 23,291 Shares 0 9,736 31,757 0 13,360 Bonds 0 10,628
18,216 81,663 2,820 Separate accounts 55,474 0 3,845 and investment
funds 0 4,785 Other financial assets 0 990 6,525 0 1,839
Investments in 0 0 2,508 real estate 81,663 46,095 Investments for
55,474 21,354 62,851 account of policyholders 216,341 50,252
Investments on 146,961 52,167 68,519 balance sheet 109,658 2,863
Off balance sheet 74,491 13,476 3,903 investments third parties
325,999 53,115 Total revenue 221,452 65,643 72,422 generating
investments *) Investments 104,391 4,080 Available-for-sale 70,913
19,163 5,563 19,813 5 Loans 13,459 8,517 7 0 0 Held-to-maturity 0 0
0 91,382 44,328 Financial assets at 62,076 22,479 60,441 fair value
through profit or loss 755 1,839 Investments in real 513 2,008
2,508 estate 216,341 50,252 Total investments on 146,961 52,167
68,519 balance sheet Table Cont. INVESTMENTS GEOGRAPHICALLY amounts
in million EUR (unless otherwise stated) Holding, other Other
activities & Total At December 31, 2007 countries eliminations
EUR Investments Shares 181 70 3,935 Bonds 3,951 22 94,931 Loans 571
0 22,554 Other financial 98 0 8,920 assets Investments in 0 0 2,521
real estate Investments 4,801 92 132,861 general account Shares 212
(24) 41,681 Bonds 248 0 29,092 Separate accounts 2,165 0 61,484 and
investment funds Other financial assets 104 0 7,619 Investments in
0 0 2,508 real estate Investments for 2,729 (24) 142,384 account of
policyholders Investments on 7,530 68 275,245 balance sheet Off
balance sheet 3,355 0 95,225 investments third parties Total
revenue 10,885 68 370,470 generating investments *) Investments
Available-for-sale 2,310 98 98,047 Loans 571 0 22,554
Held-to-maturity 1,876 0 1,876 Financial assets at 2,773 (30)
147,739 fair value through profit or loss Investments in real 0 0
5,029 estate Total investments on 7,530 68 275,245 balance sheet *)
As of 2008, real estate for own use (both general account and for
account of policyholders) has been reclassified from revenue
generating investments to other assets. The comparative 2007
information has been adjusted accordingly. ASSETS AND CAPITAL
GEOGRAPHICALLY amounts in million EUR (unless otherwise stated)
United Americas Kingdom The United USD GBP Americas Netherlands
Kingdom At September 30, 2008 226,585 51,215 Assets business units
158,418 59,587 64,804 Other assets Total assets on balance sheet
13,090 1,497 Capital in units 9,152 2,541 1,895 Total capital base
Other net liabilities Total At December 31, 2007 243,946 55,495
Assets business units 165,713 62,009 75,668 Other assets Total
assets on balance sheet 19,056 2,166 Capital in units 12,945 3,079
2,954 Total capital base Other net liabilities Total Table Cont.
ASSETS AND CAPITAL GEOGRAPHICALLY amounts in million EUR (unless
otherwise stated) United Americas Kingdom Other Total USD GBP
countries EUR At September 30, 2008 226,585 51,215 Assets business
units 9,881 292,690 Other assets 4,133 Total assets on 296,823
balance sheet 13,090 1,497 Capital in units 1,602 15,190 Total
capital base 15,691 Other net liabilities (501) Total 15,190 At
December 31, 2007 243,946 55,495 Assets business units 9,205
312,595 Other assets 1,525 Total assets on 314,120 balance sheet
19,056 2,166 Capital in units 1,413 20,391 Total capital base
21,394 Other net liabilities (1,003) Total 20,391 RECONCILIATION
NON-GAAP MEASURES TO INCOME BEFORE TAX Q3 Q3 Ytd Ytd EUR millions
Notes 2008 2007 % 2008 2007 % Net operating earnings 92 509 (82)
849 1,563 (46) Income tax on operating earnings 24 164 (85) 267 493
(46) Operating earnings before tax 116 673 (83) 1,116 2,056 (46)
Net gains and losses on investments (47) 61 N.M. (312) 254 N.M.
Other income 5 0 N.M. 5 212 (98) Impairment charges (407) (62) N.M.
(537) (59) N.M. Other charges (2) (1) (100) (2) (182) 99
Policyholder tax (8) 11 N.M. (53) 34 N.M. Income before tax (343)
682 N.M. 217 2,315 (91) Currencies Income statement items: average
rate 1 EUR = USD 1.5197 (2007: USD 1.3447). Income statement items:
average rate 1 EUR = GBP 0.7825 (2007: GBP 0.6758). Balance sheet
items: closing rate 1 EUR = USD 1.4303 (2007: USD1.4179; year-end
2007: USD 1.4721). Balance sheet items: closing rate 1 EUR = GBP
0.7903 (2007: GBP 0.6968; year-end 2007: GBP 0.7334). Notes: 1)
After deduction of preferred dividend and coupons on perpetuals.
Shareholders' equity per share is calculated after deduction of the
preferred 2) share capital of EUR 2.1 billion (at Dec. 31, 2007:
EUR 2.1 billion) and considering the number of treasury shares. The
number of common shares used in the calculation of shareholders'
equity per share is 1,516 million (at Dec. 31, 2007: 1,500
million). Other Explanatory Notes The interim condensed
consolidated financial statements included in Appendix III have
been prepared in accordance with IAS 34 'Interim financial
reporting'. It does not include all of the information required for
full financial statements and should therefore be read together
with the 2007 consolidated financial statements of AEGON N.V. as
included in AEGON's Annual Report over 2007. As of January 1, 2008,
AEGON reclassified, on the face of its balance sheet, the real
estate for own use from Investments general account and Investments
for account of policyholders to Other assets and receivables. In
addition AEGON reclassified cash flows from real estate held for
own use as cash flows from operating activities to investing
activities, to the extent that they relate to real estate that is
occupied by AEGON's own employees. The comparative 2007 information
has been adjusted accordingly. This change reduced Investments
general account by EUR 330 million and Investments for account of
policyholder by EUR 141 million with an offsetting increase in
Other assets and receivables of EUR 471 million. All other
accounting policies and methods of computation applied in the
interim financial statements are the same as those applied in the
2007 consolidated financial statements, which were prepared in
accordance with the International Financial Reporting Standards
(IFRS) as adopted by the European Union. For AEGON this is equal to
IFRS as published by the International Accounting Standards Board.
The published figures in these interim financial statements are
unaudited. Condensed consolidated income statement The result from
financial transactions in the first nine months of 2008 amounts to
a loss of EUR 20.6 billion compared to a gain of EUR 5.5 billion in
the first nine months of 2007. This decrease primarily reflects
losses on investments for account of policyholders. These losses
are offset by a decrease in the benefits and expenses line which
decreases from an amount of EUR 33.5 billion in the third quarter
of 2007 to EUR 5.2 billion in the third quarter of 2008. Capital
and funding The capital management section, provided on pages 9-10,
includes information on issuances, repurchases and repayments of
debt and equity securities effectuated in this interim reporting
period. Investment impairments Page 7 of the results release
includes information on net impairments recognized in the third
quarter of 2008. Condensed consolidated statement of changes in
equity Page 10 of the results release includes information on the
movements in shareholder's equity. Equity market sensitivities
Fluctuations in the equity markets have affected AEGON's
profitability, capital position and sales of equity related
products in the past and may continue to do so. Exposure to equity
markets exists in both assets and liabilities. Equity exposure
exists through direct equity investments, guaranties on minimum
return or accumulation guarantees in insurance and investment
contracts and impact on fee income related to charges on
policyholder account balances. A significant assumption related to
estimated gross profits on variable annuities and variable life
insurance products in the United States, Canada and some of the
smaller country units, is the annual long-term growth rate of the
underlying assets. As equity markets do not move in a systematic
manner, assumptions as to the long-term growth rate are made after
considering the effects of short-term variances from the long-term
assumptions (a reversion to the mean assumption). The
reconsideration of this assumption may affect the original DAC or
VOBA amortization schedule, referred to as DAC or VOBA unlocking.
The difference between the original DAC or VOBA amortization
schedule and the revised schedule, which is based on estimates of
actual and future gross profits, is recognized in the income
statement as an expense or a benefit in the period of
determination. At September 30, 2008, the reversion to the mean
assumptions for variable products, primarily variable annuities,
were as follows in the United States: gross long-term equity growth
rate of 9% (June 30, 2008: 9%); gross short-term growth rate of 15%
(June 30, 2008: 10%). The reversion period for the short-term rate
is five years. The sensitivity analysis of net income to changes in
equity prices is presented in the table below. The sensitivity of
net income to changes in equity reflects changes in the market
value of AEGON's portfolio, changes in DAC amortization,
contributions to pension plans for AEGON's employees, the
strengthening of the guaranteed minimum benefits, when applicable
and the impact on fee income related to charges on policyholder
account balances. The results of equity sensitivity tests are
non-linear. The main reason for this is due to equity options sold
to clients that are embedded in some of AEGON's products and that
more severe scenarios could cause accelerated DAC amortization and
guaranteed minimum benefits provisioning, while moderate scenarios
may not. Immediate change of Estimated approximate effects on net
income (12 month period) in million EUR September 30, 2008 Equity
decrease 20% (700) Equity decrease 40% (1,600) Guarantees valuation
Guarantees embedded in pension, life and variable annuity contracts
of AEGON USA and AEGON The Netherlands are measured at fair value.
These contracts include long-term guarantees that are embedded in
the contracts which for accounting purposes are valued separately.
One of the inputs to the valuation models are implied volatilities.
A valuation technique should reflect what the transaction price
would have been on the measurement date in an arm's length
transaction motivated by normal business considerations. The prices
of guarantees as such are not market observable. Therefore AEGON is
not able to calibrate the value of its models to markets.
Management concluded that the implied volatility quotes at
September 30, 2008 did not reflect an orderly active market and
that implied volatilities used in the valuation of guarantees
should be based on Level 3 type pricing; i.e. based on internal
models. Business combinations On February 26, 2008 AEGON has
entered into an agreement to acquire 100% of Ankara Emeklilik
Anonim Sirketi (Ankara Emeklilik), a Turkish life insurance and
pension provider, from Polis Bakim ve Yardim Sandigi. The
transaction, subject to regulatory approval in Turkey, was closed
in the third quarter of 2008. Ankara Emeklilik has a
well-established presence in the Turkish life insurance and private
pension market, with over 54,000 pension fund members and
approximately EUR 35 million in assets under management (Source:
Pension Monitoring Center - February 18, 2008). Ankara Emeklilik
sells its products and services through a variety of different
channels and has an agreement in place to distribute through a
nationwide network of 236 branches belonging to Sekerbank. On April
21, 2008 AEGON and China's Industrial Securities have completed the
establishment of their asset management joint venture following the
recent final approval by the regulatory authorities. Under the
agreement, AEGON has acquired a 49% interest in Industrial Fund
Management Company (IFMC), a Chinese mutual fund manager with
approximately EUR 3 billion assets under management as of March 31,
2008. Industrial Securities, one of China's leading securities
companies, will retain the remaining 51% of IFMC. The initial
agreement was announced on May 28, 2007. The joint venture will be
renamed AEGON Industrial Fund Management Company. Both shareholders
will be equally represented in the Board of Directors. The current
management team led by CEO Yang Dong will continue to lead AEGON
Industrial FMC with the objective of becoming one of the top
players in the Chinese fund management market. Over the past two
years, assets under management have increased from EUR 600 million
to EUR 3 billion. On June 30, 2008 AEGON completed the 100%
purchase of the registered capital of UNIQA Asset Management
Company and Heller-Saldo 2000 Pension Fund Management Company, both
Hungarian entities, from UNIQA Insurance Company. The agreement was
signed on February 21, 2008 and it was subject to regulatory
approval which was subsequently received. Following the
acquisition, assets under management increased by approximately EUR
300 million (Source: Hungarian Financial Supervisory Authority
(HFSA) 3Q 2007 figures). On June 30, 2008 AEGON Hungary Pension
Fund merged with 'Uniqa and Public Service Pension Fund'. As a
result of the merger, AEGON is the second largest pension fund
provider in Hungary. On June 30, 2008 AEGON completed the planned
merger of its pension fund management company PTE AEGON with BRE
Bank's PTE Skarbiec-Emerytura. As part of the merger agreement,
AEGON acquired BRE Bank's shareholding in the newly combined
pension fund. The merger, agreed in June last year, will strengthen
AEGON's position both in the Polish pension market and in the
Central & Eastern European region as a whole. With the merger,
AEGON will become Poland's fifth largest pension fund manager, with
a market share of approximately 6%. The combined fund has some
800,000 members and more than EUR 1.8 billion in assets under
management. For business combinations in the third quarter 2008
please refer to page 2 of this results release. Commitments and
contingencies There have been no material changes in contingent
assets and liabilities reported in the 2007 consolidated financial
statements of AEGON. Events after the balance sheet date For
business combinations after the third quarter 2008 please refer to
page 2 of this results release. For the announcement on the EUR 3
billion additional capital buffer provided by Vereniging AEGON,
financed by the Dutch State, please see page 9 of this results
release. About AEGON AEGON is one of the world's largest life
insurance and pension groups, and a strong provider of investment
products. AEGON empowers local business units to identify and
provide products and services that meet the evolving needs of
customers, using distribution channels best suited to local
markets. AEGON takes pride in balancing a local approach with the
power of an expanding global operation. With headquarters in The
Hague, the Netherlands, AEGON companies employ almost 32,000 people
worldwide. AEGON's businesses serve millions of customers in over
twenty markets throughout the Americas, Europe, and Asia. Respect,
quality, transparency and trust constitute AEGON's core values as
the company continually strives to meet the expectations of
customers, shareholders, employees and business partners. AEGON is
driven to deliver new thinking with the ambition to be the best in
the industry. Disclaimers Cautionary note regarding non-GAAP
measures This press release includes certain non-GAAP financial
measures: net operating earnings, operating earnings before tax,
(net) underlying earnings and value of new business. The
reconciliation of net operating earnings and operating earnings
before tax to the most comparable IFRS measures is provided on page
39. A reconciliation of (net) underlying earnings to operating
earnings before tax is provided on page 27. Value of new business
is not based on IFRS, which are used to report AEGON's quarterly
statements and should not be viewed as a substitute for IFRS
financial measures. AEGON believes that these non-GAAP measures,
together with the IFRS information, provide a meaningful measure
for the investment community to evaluate AEGON's business relative
to the businesses of our peers. Local currencies and constant
currency exchange rates This press release contains certain
information about our results and financial condition in USD for
the Americas and 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 us presented in EUR, which is the
currency of our primary financial statements. Forward-looking
statements The statements contained in this press release 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:
believe, estimate, target, intend, may, expect, anticipate,
predict, project, counting on, plan, continue, want, forecast,
should, would, is confident, will, and similar expressions as they
relate to our company. These statements are not guarantees of
future performance and involve risks, uncertainties and assumptions
that are difficult to predict. We undertake no obligation 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 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: - Changes in general
economic conditions, particularly in the United States, the
Netherlands and the United Kingdom; - Changes in the performance of
financial markets, including emerging markets, such as with regard
to: - The frequency and severity of defaults by issuers in our
fixed income investment portfolios; and - 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 we hold; - The frequency and severity of insured loss
events; - Changes affecting mortality, morbidity and other factors
that may impact the profitability of our insurance products; -
Changes affecting interest rate levels and continuing low or
rapidly changing interest rate levels; - Changes affecting currency
exchange rates, in particular the EUR/USD and EUR/GBP exchange
rates; - Increasing levels of competition in the United States, the
Netherlands, the United Kingdom and emerging markets; - Changes in
laws and regulations, particularly those affecting our operations,
the products we sell, and the attractiveness of certain products to
our consumers; - Regulatory changes relating to the insurance
industry in the jurisdictions in which we operate; - Acts of God,
acts of terrorism, acts of war and pandemics; - Changes in the
policies of central banks and/or governments; - Litigation or
regulatory action that could require us to pay significant damages
or change the way we do business; - Customer responsiveness to both
new products and distribution channels; - Competitive, legal,
regulatory, or tax changes that affect the distribution cost of or
demand for our products; - Our failure to achieve anticipated
levels of earnings or operational efficiencies as well as other
cost saving initiatives; and - The impact our adoption of the
International Financial Reporting Standards may have on our
reported financial results and financial condition. Group Corporate
Communications & Investor Relations Media relations: Phone:
+31(0)70-344-8956, E-mail: . Media conference call 8:30 am CET
Audio webcast on Investor relations: Phone: +31(0)70-344-8305 or
+1-877-548-9668 - toll free USA only E-mail: Analyst & investor
call: 3:00 pm CET, Audio webcast on http://www.aegon.com/ Call-in
numbers (listen only): USA: +1-480-629-1990, UK: +44-208-515-2301,
NL: +31-20-796-5332, Replay: +44-208-515-2301 - Access code:
140764# Financial supplement: AEGON's Q3 2008 Financial supplement
is available on http://www.aegon.com/ Website:
http://www.aegon.com/ DATASOURCE: AEGON N.V.
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