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Aegon adds £4bn assets to platform in 2015

Aegon adds £4bn assets to platform in 2015

Aegon’s UK chief executive has argued the value of advice to balance security with flexibility has never been greater.

In full year results published today (19 February), the insurer reported a significant boost in net income for the final quarter of 2015, reaching €478m (£371m) after making a €524m (£407m) loss in quarter three.

According to the results, this increase was driven by net recoveries and lower fair value losses.

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Despite Aegon’s yearly net income being down compared to 2014, sales figures were up to €10.7bn (£8.3bn) in 2015 from €8.6bn (£6.7bn).

Aegon’s UK business reeported it has delivered earnings of £19m in the fourth quarter of the year.

The provider saw platform assets reach £6.4bn in 2015 from £2.7bn, while the number of customers on its platform hit the 243,000 mark.

Adrian Grace, UK chief executive of Aegon, pointed out its earnings proved consistent in the second half of the year, with it being the second consecutive quarter where it delivered earnings of £19m.

“The strong performance has been achieved through higher earnings from pensions and as a result of lower costs combined with increasing customer numbers.

“These improvements more than offset lower earnings from life which resulted from our conscious decision to de-risk our investment portfolio under Solvency II.”

Mr Grace said the firm’s strategic goal is to continue to build the platform and add £900m of assets and an additional 44,000 customers.

The platform business is benefiting from the new pension freedoms with assets in advised drawdown up 88 per cent year-on-year, as customers and their advisers took advantage of the reforms, Mr Grace added.

“2015 proved to be a successful year in which we’ve delivered total earnings of £91m and added almost £4bn in assets to the platform,” he said.

Aegon’s UK head also suggested advisers will benefit from an advice windfall as market conditions build to deliver a “pension perfect storm”.

“The pension freedoms have provided a huge advice boost around income options, investment decisions and passing on wealth through the generations.

“Next month’s Budget could see significant changes to pensions tax relief, adding further demand for advice, particularly from higher rate tax payers looking to optimise their savings.

“Combined with one of the most volatile starts to the year in recent stock market history, the value of advice to balance security with flexibility has never been greater.”

katherine.denham@ft.com