Dutch insurer Aegon NV reported a 59% rise in first quarter earnings today thanks to fewer impairment charges and a turnaround at its British operations.
Aegon does around two-thirds of its business in the US, where it is the owner of the Transamerica brand. It reported better US sales, but worse earnings from operations as people live longer.
Net profit was €521m, up from €327m in the same period a year ago.
The biggest reason behind the increase was the quarterly reappraisal of the “fair value” of Aegon’s assets, which led to a €156m gain against a loss of €85m the same period a year ago. Lower taxes and a better operating performance also contributed slightly.
The company said “underlying earnings” – a non-standard measure which seeks to strip out investment impacts – rose 3% to €425m, as cost-cutting in Britain paid off. Underlying earnings there rose to €29m from €12m a year earlier. The company’s underlying earnings in developing markets rose 29% to €88m.
Aegon noted that its costs from impaired assets have fallen to €41m, the lowest level since the start of the 2008 financial crisis. Most impairments were still linked to mortgage-backed securities.