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Aegon UK operating profit falls 23% but value of new business increases

Aegon UK’s operating earnings fell 23 per cent to £34.3m in the first quarter of 2008 from £44m in the first quarter of 2007. However it says the value of new business was £39.8m compared with £38.9m in 2007.

Aegon’s new life and pensions business was £288m for the first quarter matching that of the first quarter of 2007.

Corporate pension business increased by 22 per cent compared with the first quarter of last year which the firm attributes to an increase in the number of group schemes and increments.

Individual annuities new business rose by 13 per cent to £342m single premiums. Individual protection increased by 17 per cent to £12.7m API which the firm credits to distribution agreements with Barclays and HSBC.

New business for individual pensions was down 5 per cent at £60.8m API. New business in offshore bonds fell 13 per cent to £198m single premium and retirement drawdown products fell by 39 per cent to £259m.

Total sales in Aegon Asset Management fell from £175.5m to £105.9m and institutional from £95.6m to £35.3m.

Aegon UK chief executive Otto Thoresen says: “In a challenging first quarter, our new business results are good. We have matched last year’s strong first quarter and improved the value of new business at the same time.

“We are now seeing the benefits of our product diversification strategy, with excellent growth in annuities and protection establishing a prominent position in markets which have been important development areas for us.”

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