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Results from fair value items amounted to EUR 221 million compared with a loss for the previous year of EUR 544 million. Most of the turnaround was attributable to an improvement in the fair value of guarantees net of related hedges in the Netherlands. 

Impairments totaled EUR 452 million, a significant improvement in 2010 that reflected better market conditions. This was the lowest level of impairments in three years, but is still above AEGON’s long-term expectations. Impairments were primarily related to US real estate related securities. 

Other charges amounted to EUR 309 million and included a one-time payment for settlement of a dispute related to a bank-owned life insurance policy in the United States and restructuring charges in the United States, the United Kingdom and Hungary. The charges were partly offset by a book gain from the sale of AEGON’s funeral insurance business in the Netherlands. 

Income tax amounted to EUR 165 million for 2010, while 2009 had included a tax credit of EUR 658 million. 

## Operating expenses 

Operating expenses increased 3% in 2010 to EUR 3.4 billion. The results of expense savings in AEGON’s main operations in the United States, the Netherlands and the United Kingdom were more than offset by restructuring charges, project related costs (e.g. Solvency II) and investments in growth markets. At constant currency, excluding restructuring charges, operating expenses declined 2% in 2010 compared with the previous year. 

## Sales and deposits 

AEGON’s new life sales in 2010 increased 5% compared with 2009 to EUR 2.2 billion. Sales across the company showed improvements during the year. Spain was an exception, as a consequence of continued weak economic conditions that affected one of AEGON’s joint venture partners. 

Gross deposits – excluding run-off businesses – increased 18% to EUR 32.6 billion in 2010 as a result of continued strong growth in variable annuity, retail mutual fund and pension deposits in the United States, as well as new mandates for AEGON Asset Management. Evidence of the strategic shift from spread to fee-based businesses. 

## Value of new business 

AEGON’s value of new business declined 28% to EUR 555 million in 2010, mainly as a result of strategic decisions. In the United States, the value of new business was impacted by the decision to de-emphasize the sale of fixed annuities. In the United Kingdom the main reason for the decline was repricing of immediate annuities. 

## Revenue-generating investments 

AEGON’s revenue-generating investments increased 14% to EUR 413 billion during the year. The increase was due to new business growth, stronger financial markets and the positive effects of currency movements. 

AEGON is setting its sight toward sustainable growth 

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Source: United Nations World Population Prospects. 

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