content_image/258813.jpg
## Core capital securities 

In August 2010, the European Commission approved the support of EUR 3 billion of core capital obtained from the Dutch State through Vereniging AEGON at the height of the global financial crisis. The Commission gave its approval, on condition that the company adopted a limited number of behavioral constraints. 

To secure the European Commission’s approval, AEGON will$^{ 1}$: 

■ Continue to run off its institutional spread-based business in the United States and lower production of fixed annuities. These measures will result in a reduction of USD 25 billion in AEGON’s US general account by the end of 2012. 

■ Increase the equity hedge on the company’s variable annuity in-force book in the United States and commit to continue pricing new variable annuity products on a market consistent basis worldwide and in line with AEGON’s pricing policy. 

■ Implement measures to further improve the quality of the company’s capital base, primarily by increasing the core capital to at least 75% of total capital by the end of 2012. 

Many of these measures had been decided by AEGON before the European Commission ruling as part of broader measures to improve AEGON’s risk-return profile and operational efficiency and to lower costs. AEGON does not expect these measures to affect the company’s ability to grow its core business profitably. 

In addition, AEGON is also subject to a number of other temporary behavioral constraints, which will remain in force until the convertible core capital securities are fully repurchased: 

■ AEGON will not pursue acquisitions, though investment in the company’s partnerships in Spain is permitted, providing AEGON’s overall share of the Spanish market does not increase. 

■ AEGON will make no further dividend payments to common shareholders until all core capital securities issued to the Dutch State are fully repurchased. 

■ In the Netherlands, AEGON will not pursue a top- three price leadership position in either the residential mortgage or internet savings market. 

■ AEGON will request Standard & Poor’s to no longer publish a financial strength rating for the company’s Dutch life insurance unit$^{ 2}$. 

1 For full details, please refer to the decision of the European Commission of August 17, 2010, published in the Official Journal of the European Union (C/290/2010 - http://ec.europe.eu). 

2 Standard & Poor’s has subsequently complied with this request. 

## Timetable for repayment 

<img src='content_image/258813.jpg'>

