The insurer says impairments of £341m or €380m contributed to its net loss of £155m.
In the UK, underlying earnings before tax were down 13 per cent from £8m to £7m, while for distribution, which includes Aegon-owned Positive Solutions and Origen, the insurer posted a £3m loss compared to zero profits last year.
Among £135m of planned cost cutting measures across the group, Aegon says that in the UK it will target savings on its distribution expenses, restructuring IT, marketing and customer services.
UK life and pensions new business was 6 per cent lower in the first quarter than in the same period of 2008 at £275m, down from £291m annual premium equivalent last year.
Annuity sales grew 56 per cent in the UK from £355m in Q1 2008 to £555m on a single premium basis.
Aegon says demand for its variable annuity increased, despite rival player Hartford recently announcing it is pulling out of the UK market.
Aegon’s 5 for Life variable annuity sales grew from £23m in Q1 2008 to £102m during Q1 2009.
UK chief executive Otto Thoresen says: “Aegon UK’s new business levels remained resilient during the first three months despite very challenging economic conditions and our performance compares well against that of our competitors.
“Aegon is now clearly positioned as one of the key players in the UK life and pensions sector. Our strategy to diversify our business across a broader product range has enabled us to maintain good momentum through difficult markets.
He adds: “While customers may be reluctant to make investment and savings decisions due to the prevailing economic conditions, our annuity business and corporate pensions businesses continue to deliver growth.”