Aegon's offshore business escapes cuts
Aegon’s Irish-domiciled international business will not be affected by the 25% cuts being imposed on its UK life and pensions business.
A company spokesman said Aegon Ireland, which administers the company’s offshore bonds and variable annuity product, was separate legal entity to the UK business and it was therefore “business as usual” for the firm.
The spokesman also revealed there were no reviews planned for the offshore business.
On Tuesday, Aegon announced considerable cost-cutting measures that may see up to 600 job losses at its Edinburgh headquarters.
Savings to the tune of £80m a year are planned, an element of which will see the Dutch life insurer withdraw from the bulk annuity market due to ‘pricing pressures’. It will continue to focus on what was termed ‘growth markets’ such as at retirement and company pension areas.
A US business, Transamerica Reinsurance, is also likely to be offloaded on the basis that reinsurance is not a core activity of the company.
Aegon said the measures were designed to improve the company’s return on capital, from 2.7% in 2009 to between 8% and 10% by 2014, and generating cash flow of £600m to £650m between 2010 and 2014.