The Hague, May 20, Annual General Meeting of Shareholders Aegon N.V. Jaarlijkse Algemene Vergadering van Aandeelhouders Aegon N.V.

Transcription

1 The Hague, May 20, 2015 Annual General Meeting of Shareholders Aegon N.V. Jaarlijkse Algemene Vergadering van Aandeelhouders Aegon N.V.

2 Welcome to the Annual General Meeting of Shareholders In order to hear a simultaneous translation into English, please choose channel 11 Welkom op de jaarlijkse Algemene Vergadering van Aandeelhouders Voor het beluisteren van een simultaanvertaling in het Nederlands kiest u kanaal 10 2

3 Picture Rob Routs Chairman Supervisory Board Voorzitter Raad van Commissarissen 3

4 Agenda item 1 / Agendapunt 1 Opening 4

5 Agenda item 2 / Agendapunt 2 Presentation on the course of business in 2014 Presentatie over de gang van zaken in

6 Strong foundations for growth The Hague May 20, 2015 Alex Wynaendts CEO & Chairman of the Executive Board

7 7 Aegon s purpose is to help people take responsibility for their financial future

8 Our products and services have never been more needed Trends Our expertise Changing capital requirements Changing demographics Increased regulation Low interest rates New digital technologies Protection Accumulation At & after retirement We support people throughout their working lives and into retirement 8

9 Global aging and changing demographics Aegon Retirement Readiness Index (ARRI) Hungary: 4.9 Netherlands 5.7 United States India 7.0 Spain: 5.0 Poland: 5.1 Turkey: 5.4 Sweden: 5.4 Japan 4.6 United Kingdom 6.0 France: 5.4 Canada: 6.0 Germany: 6.1 China: Global Retirement Readiness Score 5.8 Brazil: 6.8

10 10 Growing importance of technology

11 Persistently low interest rates 10-year government bond yields US NL 7% 6% 5% 4% 3% 2% 1%

12 Regulatory changes with a significant impact on our industry Regulators seeking to strengthen consumer protection New laws on tax and data privacy Unprecedented reforms in some of our markets End of commissions to brokers in the UK and the Netherlands 12

13 New capital requirements to enhance risk management and governance Implementation of Solvency II in 2016 Aimed at enhancing consumer protection Capital requirements linked to risks insurers take on Regulators will set the bar high 13

14 A clear framework to address global trends and developing customers needs Purpose Help people take responsibility for their financial future Company values Working together Bringing Clarity Exceeding Expectations Strategic Objectives Ambition Leader in all of our chosen markets 14

15 Making the right choices Optimize our portfolio Canada Divestments Partnership with La Mondiale (France) Joint venture with Caja Badajoz (Spain) Expanding distribution with strong local partners Santander Totta (Portugal) La Banque Postale (France) BANCOOB (Brazil) 15

16 Towards a more efficient and responsive company Pursue operational excellence Adjusted product offerings to continued low interest rates Improved efficiency OpEx / (OpEx + UEBT) Launched new products to meet customers needs 63% 63% 59% 59% 58% Established global IT framework Cost savings create room to invest in Aegon s businesses * 16 * Adjusted for model and assumption updates. Without these adjustments, our cost: earnings ratio for 2014 would have totaled 61%.

17 Becoming a more customer-centric company Customer loyalty Online offerings in nearly all Aegon s markets Further enhancement of online platforms & tools Launched Venture Fund to respond quicker to changing markets Enhancing services of customer service centers Through launch of specialized software Customer loyalty measured with Net Promoter Score Aiming for top quartile in all our chosen markets 17

18 Empowered employees to help people take responsibility for their financial future Empower our employees Staff performance metrics Engagement 73 Broadening talent mix Attracting talented people from a range of different industries Talent Review Process Succession planning and talent identification well established Promoting workforce diversity Joined Workplace Pride Enablement High performing norm 2015 Financial services norm

19 Organizational changes to take advantage of opportunities Servicing US customers through a single investment & retirement division 3,300 I&R employees with a national footprint Actively serving 25,000+ plan sponsors Enhancing distribution Introducing new investment solutions Better connecting with our customers 5.4 million customers New deposits of USD 42 billion in 2014 and revenue generating investments of USD 296 billion 19

20 Integrated solution to and through retirement in the UK At-retirement Non-advised Workplace savings Capabilities for adviser market Self service Gated solutions for employees Single investment & trading platform offering a compelling solution to advisers, employers and their employees 20

21 Leadership positions in the Netherlands offer strong foundations for growth #1 Pensions insurer* #2 Pension administrator #1 PPI provider with 0.6 billion euro in Assets under Management** In millions of customers 4.4 Aegon Peer 1 Peer 2 Peer 3 Peer 4 Peer 5 Others Aegon PPI Cappital Pension fund Insurer Pension fund Aegon Pension fund 21 * Gross written premiums pensions in 2013 (Source: DNB) ** Per January 1, Premium Pension Institution (PPI) is a specific type of defined contribution contract

22 New Markets strategy driving continued growth Focus on protection Asia Leadership in risk/rider products in key CEE markets Central & Eastern Europe Latin America Spain Strong growth in high-net-worth segments in Hong Kong and Singapore Expanded distribution Newly developed professional advisory channel in Spain Continued growth of tied agent networks in CEE Direct propositions New online propositions in Asia, CEE, Spain and Brazil Leader in Indian online term life insurance market Asset Management Strong growth of assets under management Expanding our third-party business 22

23 Our strategy is delivering results Getting closer to our customers Expanding digital capabilities Enhancing distribution Customer focused Strong performance Solid underlying earnings before tax in 2014 EUR 1.9 billion Continued strong sales in 2014 EUR 8.6 billion Very strong ratings AA- 23

24 Sustainable dividend growth Proposed final 2014 dividend of EUR 0.12 per share; total 2014 dividend of EUR 0.23 per share Continue to neutralize stock dividends to avoid dilution Future dividend growth dependent on strong capital position and cash flows Increasing dividends (EUR per share) 0.20* * Final 2011 dividend of EUR 0.10 per share annualized for comparative purposes

25 Creating value for all our stakeholders Protection Investors Employees Customers Benefits Capital Talent Trust Profits Society 25

26 Agenda item 2 / Agendapunt 2 Presentation on the course of business in 2014 Presentatie over de gang van zaken in

27 Agenda item 3.1 / Agendapunt 3.1 Annual Report 2014 Jaarverslag

28 Creating and sharing value in 2014 The Hague May 20, 2015 Darryl Button CFO & Member of the Executive Board

29 Aegon performed strongly in 2014 Key figures Underlying earnings Net income Operational expenses Sales Revenue-generating investments - 5% +38% +1% + 20% +17% EUR 1.9 billion EUR 1.2 billion EUR 3.3 billion EUR 8.6 billion EUR 558 billion 29

30 Strong underlying trends masked by assumption changes and model updates Underlying earnings before tax (EUR million) Net income (EUR million) 1,775 1,982 1,968 1, , , Underlying earnings impacted by assumption changes and model updates 30 Note: 2011 as reported

31 Total sales growth of 20% driven by continued strong deposits Strong gross deposits mainly driven by US pensions and variable annuities Stronger universal life production in US and Asia; higher pension production in the Netherlands Accident & health and general insurance sales exceed EUR 1 billion for the first time Gross & net deposits (EUR billion) New life sales (EUR billion) A&H and general insurance (EUR billion) +25% +7% +26% FY 2013 FY 2014 FY 2013 FY 2014 FY 2013 FY Note: Total sales consists of new life sales plus 1/10 th of gross deposits plus new premiums for accident & health and general insurance

32 Continued strong capital position and cash flows Operational free cash flows (Excl. market impacts and one-time items, EUR bln) Return on equity (%) % 6.7% 8.6% 7.8% Excess capital at the holding (EUR billion) Solvency ratio (Insurance Group Directive, %) % 228% 212% 208% Note: 2011 and 2012 return on equity as reported

33 Operational free cash flows and holding excess capital Operational free cash flows of EUR 1.2 billion excluding market impacts and one-time items Positive market impacts and one-time items largely offset by negative impacts from model updates and assumption changes Increase in free cash flows driven by reduction in holding expenses Operational free cash flow 1, Market impacts & one-time items 212 (334) Normalized OFCF 1,335 1,237 Holding funding & operating expenses (460) (326) Free cash flow

34 Excess capital development Holding excess capital declined following EUR 1.0 billion of senior debt redemptions Starting position Net dividend from units Acquisitions & divestments 0.6 (0.0) Common dividends (0.4) (0.4) Funding & operating expenses (0.4) (0.4) Debt issuances/redemptions (0.4) (1.0) Other (0.1) (0.1) Ending position

35 Leverage and fixed charge coverage targets achieved in 2014 Gross financial leverage target range of 26-30% Gross leverage (EUR billion, %) Leverage cut by ~25% since % 32.0% 33.3% 28.7% Fixed charge coverage target range of 6-8x Fixed charges reduced by more than 40% Funding costs (EUR million, fixed charge coverage) 6.5x Positioning capital structure for Solvency II 5.2x Taking advantage of low interest rates through proactive refinancing x 4.8x Note: Gross leverage and fixed charge coverage ratios as reported

36 Q earnings impacted by adverse claims experience Underlying earnings impacted by adverse claims experience and low interest rates in the US Sales growth across the group; new business remains profitable despite low interest rates Strong operational free cash flows and solid excess capital position Earnings Return on Equity Sales Cash flows 469m 6.6% 2.8bn 339m -6% compared with Q % excluding run-off businesses +32% compared with Q % compared with Q Note: Earnings = underlying earnings before tax; Cash flows = operational free cash flows excluding market impact and one-time items

37 Solvency II range confirmed; uncertainties remain EEA Netherlands (IM) United Kingdom (IM) Spain (SF) CEE (SF) Diversification benefit Non-EEA US life RBC ratio conversion Non-regulated and other entities Holding + = Senior leverage net of excess capital Required capital Group Cash flows driven by local ratios Updated capital policy January 2016 Expected group Solvency II ratio remains in the range of 150% to 200% Uncertainties still to be resolved throughout 2015 Internal model approval process and calibration US equivalence and deduction & aggregation methodology (including US RBC conversion ratio) Assessment of Transferability and Fungibility Specifications for use of Matching Adjustment Loss absorbing capacity of taxes 37 Note: EEA = European Economic Area; IM = Internal Model, SF = Standard Formula; CAL = Company Action Level

38 Looking ahead Persistently low interest rates Increased regulation of financial services 2015 Changing capital requirements Continued execution of our strategy Well-positioned to capture growth opportunities 38

39 Agenda item 3.1 / Agendapunt 3.1 Annual Report 2014 Jaarverslag

40 Agenda item 3.2 / Agendapunt 3.2 Remuneration Report 2014 Remuneratierapport

41 Main points from Aegon s Executive Board Remuneration Policy 2014 No changes to Executive Board Remuneration Policy since 2011 Executive Board policy aligned with Global Remuneration Framework Vesting according to sustained performance (ex-ante / ex-post) 2015 New type of contract for Alex Wynaendts, in connection with re-appointment Clauses in contract reflect revised governance requirements 41

42 2014 Executive Board remuneration Remuneration in 2014 Fixed compensation CEO increased with 10% compared to 2013 (After increase, Executive Board total compensation still below 25 th percentile of peer groups) Deferred variable compensation from 2011 and 2012 paid out / vested Upfront variable compensation regarding performance year 2013 paid out / vested 3 year holding periods apply to all vested shares Conditional variable compensation allocated over 2014 Alex Wynaendts: 79,13% of fixed compensation (2013: 98,33%) Darryl Button: 79,76% of fixed compensation (2013: 98,50%) 40% of variable compensation to be paid in % deferred 42

43 Executive Board remuneration variable compensation indicators and results Financial and non-financial Group targets (75% maximum) Underlying earnings after tax (15%) Return on equity (15%) Market consistent value of new business (18.75%) Return on economic required capital (11.25%) Strategy/sustainability (15%): Outcome % Personal targets (25% maximum) Strategy execution business model, portfolio management, customer-centricity HR and sustainability topics employee engagement, succession planning Large projects/issues cash flow development, Solvency II 23.75% Alex Wynaendts 24.38% Darryl Button 43

44 2015 Executive Board remuneration new contract for Alex Wynaendts New contract Alex Wynaendts is a services agreement Clauses from previous employment contract that are no longer fitting or otherwise need updating will be amended New clauses will be included Severance payment in case of early termination limited to a maximum of one year annual salary in cash Retirement age will be brought forward from 62 to 60 44

45 Aegon s Remuneration Policy in general going forward Aegon s policy takes into account both national and international circumstances and conditions Legislation and regulations impact remuneration policies Dutch government introduced maximum variable compensation in financial sector Limits on sign-on-, retention- and severance payments Fiscal treatment of pension accrual in the Netherlands further limited Worldwide, Aegon s compensation policies (and competitive landscape) are impacted 45

46 Variable compensation at Aegon Group and the new maximums Prior to 2015, some selected senior staff were eligible for variable compensation exceeding the new maximums Starting performance year 2015, variable compensation levels for these roles have been adjusted downwards to match applicable new maximums Aegon the Netherlands: 20% maximum on average for senior management Holding of the Group in NL (N.V.) and Aegon companies in Europe: maximum variable compensation has become 100% Outside Europe: maximum variable compensation has become 200% 46

47 Agenda item 3.1 / Agendapunt 3.1 Annual Report 2014 Jaarverslag

48 Agenda item 3.3 / Agendapunt 3.3 Annual Accounts 2014: Proposal to adopt the Annual Accounts 2014 Jaarrekening 2014: Voorstel tot vaststelling van de Jaarrekening

49 Voting procedure / Stemprocedure Prior to the voting Insert card with chip facing you Name appears on display During the voting Voting options appear in display Press button: 1 = For 2 = Against 3 = Abstain Choice appears in display During voting you can change your choice Last choice counts Vóór de stemming Plaats kaart met chip naar voren Naam verschijnt in venster Tijdens de stemming Stemkeuzes verschijnen in venster Maak uw keuze: 1 = Vóór 2 = Tegen 3 = Onthouding Keuze verschijnt in venster Tijdens stemming kunt u uw keuze wijzigen Laatste keuze geldt 49

50 Voting on agenda item 3.3 / Stemming over agendapunt 3.3 Annual Accounts 2014: Proposal to adopt the Annual Accounts 2014 Jaarrekening 2014: Voorstel tot vaststelling van de Jaarrekening

51 Agenda item 4 / Agendapunt 4 Proposal to approve the final dividend 2014 Voorstel tot goedkeuring van het slotdividend over het boekjaar

52 Aegon s dividend policy Cash flows upstreamed to the holding are available to execute our strategy, to fund operating expenses and to pay dividends to shareholders Aegon aims to pay a sustainable dividend to shareholders, which can grow over time if performance of the company allows so Balance prudence versus offering an attractive dividend In normal circumstances, Aegon expects to declare an interim dividend and propose a final dividend for approval at the AGM 52

53 Aegon s dividend proposal Proposed final dividend for 2014: EUR 0.12 per common share Dividend (EUR) Results in total dividend for 2014 of EUR 0.23 per common share To be paid in cash or stock 0.12 Value of stock dividend approximately equal to cash dividend Final dividend Interim dividend 53

54 Agenda item 4 / Agendapunt 4 Proposal to approve the final dividend 2014 Voorstel tot goedkeuring van het slotdividend over het boekjaar

55 Voting on agenda item 4 / Stemming over agendapunt 4 Proposal to approve the final dividend 2014 Voorstel tot goedkeuring van het slotdividend over het boekjaar

56 Agenda item 5 / Agendapunt 5 Proposal to release the members of the Executive Board from liability for their duties Voorstel tot het verlenen van kwijting aan de leden van de Raad van Bestuur 56

57 Voting on agenda item 5 / Stemming over agendapunt 5 Proposal to release the members of the Executive Board from liability for their duties Voorstel tot het verlenen van kwijting aan de leden van de Raad van Bestuur 57

58 Agenda item 6 / Agendapunt 6 Proposal to release the members of the Supervisory Board from liability for their duties Voorstel tot het verlenen van kwijting aan de leden van de Raad van Commissarissen 58

59 Voting on agenda item 6 / Stemming over agendapunt 6 Proposal to release the members of the Supervisory Board from liability for their duties Voorstel tot het verlenen van kwijting aan de leden van de Raad van Commissarissen 59

60 Agenda item 7 / Agendapunt 7 Proposal to reappoint Mr. Alex R. Wynaendts to the Executive Board Voorstel tot herbenoeming van de heer Alex R. Wynaendts als lid van de Raad van Bestuur 60

61 Alex Wynaendts Age 54 Nationality Profession/ Functie Memberships other boards/ Andere bestuursfuncties* Shares in Aegon N.V./ Aantal aandelen in Aegon N.V. Dutch Chairman Executive Board and CEO of Aegon N.V. None 295,734 common shares 61 * Qualifying under Act Management and Supervision/Conform Wet bestuur en toezicht

62 Agenda item 7 / Agendapunt 7 Proposal to reappoint Mr. Alex R. Wynaendts to the Executive Board Voorstel tot herbenoeming van de heer Alex R. Wynaendts als lid van de Raad van Bestuur 62

63 Voting on agenda item 7 / Stemming over agendapunt 7 Proposal to reappoint Mr. Alex R. Wynaendts to the Executive Board Voorstel tot herbenoeming van de heer Alex R. Wynaendts als lid van de Raad van Bestuur 63

64 Agenda item 8 / Agendapunt 8 Proposal to appoint Mr. Ben J. Noteboom to the Supervisory Board Voorstel tot benoeming van de heer Ben J. Noteboom als lid van de Raad van Commissarissen 64

65 Ben Noteboom Age 56 Nationality Profession/ Functie Former occupation/ Vroegere functie: Memberships other boards/ Andere bestuursfuncties* Shares in Aegon N.V./ Aantal aandelen in Aegon N.V. Dutch Non-Executive Director CEO Randstad Holding N.V. Supervisory Board member Ahold N.V. and Wolters Kluwer 23,500 common shares 65 * Qualifying under Act Management and Supervision/Conform Wet bestuur en toezicht

66 Aegon plays a hugely important role not only in terms of providing financial security to millions of people, but also in the wider economy. The company has made exciting improvements to become more customer-centric. I hope to make a positive contribution by drawing on my own experience in this area. Ben. J. Noteboom 66

67 Agenda item 8 / Agendapunt 8 Proposal to appoint Mr. Ben J. Noteboom to the Supervisory Board Voorstel tot benoeming van de heer Ben J. Noteboom als lid van de Raad van Commissarissen 67

68 Voting on agenda item 8 / Stemming over agendapunt 8 Proposal to appoint Mr. Ben J. Noteboom to the Supervisory Board Voorstel tot benoeming van de heer Ben J. Noteboom als lid van de Raad van Commissarissen 68

69 Agenda item 9 / Agendapunt 9 Proposal to authorize the Executive Board to issue common shares Voorstel tot machtiging van de Raad van Bestuur tot uitgifte van gewone aandelen 69

70 Voting on agenda item 9 / Stemming over agendapunt 9 Proposal to authorize the Executive Board to issue common shares Voorstel tot machtiging van de Raad van Bestuur tot uitgifte van gewone aandelen 70

71 Agenda item 10 / Agendapunt 10 Proposal to authorize the Executive Board to restrict or exclude pre-emptive rights upon issuing common shares Voorstel tot machtiging van de Raad van Bestuur tot beperking of uitsluiting van voorkeursrechten bij de uitgifte van gewone aandelen 71

72 Voting on agenda item 10 / Stemming over agendapunt 10 Proposal to authorize the Executive Board to restrict or exclude pre-emptive rights upon issuing common shares Voorstel tot machtiging van de Raad van Bestuur tot beperking of uitsluiting van voorkeursrechten bij de uitgifte van gewone aandelen 72

73 Agenda item 11 / Agendapunt 11 Proposal to authorize the Executive Board to issue common shares under incentive plans Voorstel tot machtiging van de Raad van Bestuur tot uitgifte van gewone aandelen in het kader van incentiveplannen 73

74 Voting on agenda item 11 / Stemming over agendapunt 11 Proposal to authorize the Executive Board to issue common shares under incentive plans Voorstel tot machtiging van de Raad van Bestuur tot uitgifte van gewone aandelen in het kader van incentiveplannen 74

75 Agenda item 12 / Agendapunt 12 Proposal to authorize the Executive Board to acquire shares in the Company Voorstel tot machtiging van de Raad van Bestuur tot verkrijging van eigen aandelen 75

76 Voting on agenda item 12 / Stemming over agendapunt 12 Proposal to authorize the Executive Board to acquire shares in the Company Voorstel tot machtiging van de Raad van Bestuur tot verkrijging van eigen aandelen 76

77 Agenda item 13 / Agendapunt 13 Any other business Wat verder ter tafel komt 77

78 Agenda item 14 / Agendapunt 14 Close of the meeting Sluiting van de vergadering 78

79 79 Thank you Dank u wel

80 Please return your voting device and voting card before departing Wilt u voor uw vertrek uw stemkastje en stempas inleveren 80