Form 6-K AEGON NV For: May 12

May 12, 2022 1:55 PM EDT

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Securities and Exchange Commission

Washington, D.C. 20549

 

 

Form 6-K

 

 

Report of Foreign Issuer

Pursuant to Rule 13a-16 or 15d/16 of

the Securities Exchange Act of 1934

May 2022

 

 

AEGON N.V.

 

 

Aegonplein 50

2591 TV THE HAGUE

The Netherlands

 

 

 


Table of Contents

Aegon’s condensed consolidated interim financial statements for the period ended March 31, 2022, dated May 12, 2022, are included as appendix and incorporated herein by reference.

SIGNATURE

Pursuant to the requirements of the Securities Exchange Act of 1934, the registrant has duly caused this report to be signed on its behalf by the undersigned, thereunto duly authorized.

 

   

AEGON N.V.

    (Registrant)
Date: May 12, 2022   By  

/s/ J.H.P.M. van Rossum

      J.H.P.M. van Rossum
      Executive Vice President and Head of Corporate Financial Center


Table of Contents

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Condensed consolidated interim financial statements for the three-month period ended March 31, 2022 The Hague, May 12, 2022 Helping people live their best lives


Table of Contents

Condensed consolidated interim financial statements

for the three-month period ended

March 31, 2022

 

Table of contents

 

Condensed consolidated income statement

     2  

Condensed consolidated statement of comprehensive income

     3  

Condensed consolidated statement of financial position

     4  

Condensed consolidated statement of changes in equity

     5  

Condensed consolidated cash flow statement

     7  

Notes to the condensed consolidated interim financial statements

     8  

 

 

 

 

 

 

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Table of Contents

Condensed consolidated interim financial statements

for the three-month period ended

March 31, 2022

 

 

 
Condensed consolidated income statement
   
EUR millions    Notes     

1Q

2022

    

1Q

2021

   

Premium income

     4        3,930      3,958
   

Investment income

     5                            2,055      2,093
   

Fee and commission income

              720      674
   

Total revenues

        6,706                          6,725
   

Income from reinsurance ceded

        986      920
   

Results from financial transactions

     6        (15,383)      1,886
   

Other income

     7        371      41
   

Total income / (charges)

        (7,319)      9,573
   

Benefits and expenses

     8        (7,688)      9,066
   

Impairment charges / (reversals)

        28      13
   

Interest charges and related fees

        82      84
   

Other charges

              (6)      5
   

Total charges / (income)

        (7,583)      9,167
   

Share in profit / (loss) of joint ventures

        75      67
   

Share in profit / (loss) of associates

              34      (15)
   

Result before tax

        373      458
   

Income tax (expense) / benefit

     9        39      (72)
   

Net result

        412      386
   

Net result attributable to:

          
   

Owners of Aegon N.V.

        385      383
   

Non-controlling interests

              27      3
        
       

Earnings per share (EUR per share)

     13          
   

Basic earnings per common share

        0.19      0.18
   

Basic earnings per common share B

        -      -
   

Diluted earnings per common share

        0.19      0.18
   

Diluted earnings per common share B

              -      -

 

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Table of Contents

Condensed consolidated interim financial statements

for the three-month period ended

March 31, 2022

 

 
Condensed consolidated statement of comprehensive income

 

   
EUR millions   

1Q

2022

    

1Q

2021

 
   

Net result

     412        386  
   

Other comprehensive income:

       
   

Items that will not be reclassified to profit or loss:

       
   

Changes in revaluation reserve real estate held for own use

     (1)        -  
   

Remeasurements of defined benefit plans

     512        489  
   

Income tax relating to items that will not be reclassified

     (122)                                (117)  
   

Items that may be reclassified subsequently to profit or loss:

       
   

Gains / (losses) on revaluation of available-for-sale investments

     (4,945)        (2,576)  
   

Gains / (losses) transferred to the income statement on disposal and impairment of available-for-sale investments

     (65)        (62)  
   

Changes in cash flow hedging reserve

     (266)        (138)  
   

Movement in foreign currency translation and net foreign investment hedging reserve

     355        648  
   

Equity movements of joint ventures

     (23)        (2)  
   

Equity movements of associates

     (2)        (3)  
   

Disposal of group assets

     1        6  
   

Income tax relating to items that may be reclassified

     1,122        593  
   

Other

     (1)        11  
   

Total other comprehensive income / (loss) for the period

     (3,434)        (1,151)  
   

Total comprehensive income / (loss)

     (3,022)        (765)  
   
                   
   

Total comprehensive income / (loss) attributable to:

       
   

Owners of Aegon N.V.

     (3,054)        (772)  
   

Non-controlling interests

     31        7  

 

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Table of Contents

Condensed consolidated interim financial statements

for the three-month period ended

March 31, 2022

 

 
Condensed consolidated statement of financial position

 

EUR millions    Notes     

 

March 31,

2022

    

December 31,

2021

 
   

Assets

          
   

Cash and cash equivalents

        7,105        6,889  
   

Investments

     10        149,240        158,463  
   

Investments for account of policyholders

     11                            236,078                            250,953  
   

Derivatives

        7,882        8,827  
   

Investments in joint ventures

        1,809        1,743  
   

Investments in associates

        1,330        1,289  
   

Reinsurance assets

        21,423        20,992  
   

Deferred expenses

        11,524        10,503  
   

Other assets and receivables

        10,539        7,892  
   

Intangible assets

              1,365        1,333  
   

Total assets

        448,296        468,884  
   

Equity and liabilities

          
   

Shareholders’ equity

        21,177        24,282  
   

Other equity instruments

              2,372        2,363  
   

Issued capital and reserves attributable to owners of Aegon N.V.

        23,549        26,645  
   

Non-controlling interests

              219        196  
   

Group equity

        23,768        26,841  
   

Subordinated borrowings

        2,227        2,194  
   

Trust pass-through securities

        122        126  
   

Insurance contracts

        122,115        124,422  
   

Insurance contracts for account of policyholders

        139,806        149,323  
   

Investment contracts

        22,089        21,767  
   

Investment contracts for account of policyholders

        99,043        104,592  
   

Derivatives

        11,654        10,639  
   

Borrowings

     14        9,459        9,661  
   

Other liabilities

              18,013        19,321  
   

Total liabilities

        424,528        442,044  
   
                            
   

Total equity and liabilities

              448,296        468,884  

 

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Table of Contents

Condensed consolidated interim financial statements

for the three-month period ended

March 31, 2022

 

 

Condensed consolidated statement of changes in equity

For the period ended March 31, 2022

 

 

EUR millions   Share
capital 1
    

Retained

earnings

     Revaluation
reserves
     Re-
measurement
of defined
benefit plans
     Other
reserves
    

Other equity

instruments

     Issued
capital
and
reserves2
     Non-
controlling
interests
     Total  
       

Three months ended March 31, 2022

                               
       

At beginning of year

    7,354        12,362        6,442        (2,199)        325        2,363        26,645        196        26,841  
       

Net result recognized in the income statement

    -        385        -        -        -        -        385        27        412  
       

Other comprehensive income:

                               

Items that will not be reclassified to profit or loss:

                               

Changes in revaluation reserve real estate held for own use

    -        18        (18)        -        -        -        (1)        -        (1)  

Remeasurements of defined benefit plans

    -        -        -        512        -        -        512        -        512  

Income tax relating to items that will not be reclassified

    -        -        -        (122)        -        -        (122)        -        (122)  
       

Items that may be reclassified subsequently to profit or loss:

                               

Gains / (losses) on revaluation of available-for-sale investments

          (4,945)        -        -        -        (4,945)        -        (4,945)  

Gains / (losses) transferred to income statement on disposal and impairment of available-for-sale investments

    -        -        (65)        -        -        -        (65)        -        (65)  

Changes in cash flow hedging reserve

    -        -        (266)        -        -        -        (266)        -        (266)  

Movement in foreign currency translation and net foreign investment hedging reserves

    -        -        89        (11)        273        -        351        4        355  

Equity movements of joint ventures

    -        -        -        -        (23)        -        (23)        -        (23)  

Equity movements of associates

    -        -        -        -        (2)        -        (2)        -        (2)  

Disposal of group assets

    -        -        1        -        -        -        1        -        1  

Income tax relating to items that may be reclassified

    -        -        1,125        -        (3)        -        1,122        -        1,122  

Other

    -        (1)        -        -        -        -        (1)        -        (1)  

Total other comprehensive income

    -        17        (4,078)        379        244        -        (3,438)        4        (3,434)  
                                                                                 

Total comprehensive income / (loss) for 2022

    -        401        (4,078)        379        244        -        (3,054)        31        (3,022)  
       

Issuance and purchase of (treasury) shares

    -        (49)        -        -        -        -        (49)        -        (49)  

Coupons on perpetual securities

    -        (2)        -        -        -        -        (2)        -        (2)  

Incentive plans

    -        -        -        -        -        9        9        -        9  

Change in ownership non-controlling interest

    -        -        -        -        -        -        -        (8)        (8)  

At end of period

    7,354        12,712        2,363        (1,821)        569        2,372        23,549        219        23,768  
1 

Please refer to the note on share capital for a breakdown.

2 

Issued capital and reserves attributable to owners of Aegon N.V.

 

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Table of Contents

Condensed consolidated interim financial statements

for the three-month period ended

March 31, 2022

 

 

Condensed consolidated statement of changes in equity

For the period ended March 31, 2021

 

 

   
EUR millions    Share
capital 1
    

Retained

earnings

     Revaluation
reserves
     Re-
measurement
of defined
benefit plans
     Other
reserves
    

Other equity

instruments

     Issued
capital
and
reserves2
     Non-
controlling
interests
     Total  
       

Three months ended March 31, 2021

                                
       

At beginning of year

     7,480        10,943        7,480        (2,534)        (554)        2,569        25,384        75        25,459  
       

Net result recognized in the income statement

     -        383        -        -        -        -        383        3        386  
       

Other comprehensive income:

                                

Items that will not be reclassified to profit or loss:

                                

Remeasurements of defined benefit plans

     -        -        -        489        -        -        489        -        489  

Income tax relating to items that will not be reclassified

     -        -        -        (117)        -        -        (117)        -        (117)  
       

Items that may be reclassified subsequently to profit or loss:

                                

Gains / (losses) on revaluation of available-for-sale investments

     -        -        (2,576)        -        -        -        (2,576)        -        (2,576)  

Gains / (losses) transferred to income statement on disposal and impairment of available-for-sale investments

     -        -        (62)        -        -        -        (62)        -        (62)  

Changes in cash flow hedging reserve

     -        -        (138)        -        -        -        (138)        -        (138)  

Movement in foreign currency translation and net foreign investment hedging reserves

     -        -        221        (41)        466        -        645        2        648  

Equity movements of joint ventures

     -        -        -        -        (2)        -        (2)        -        (2)  

Equity movements of associates

     -        -        -        -        (3)        -        (3)        -        (3)  

Disposal of group assets

     -        -        -        -        6        -        6        -        6  

Income tax relating to items that may be reclassified

     -        -        588        -        5        -        593        -        593  

Other

     -        9        -        -        -        -        9        2        11  

Total other comprehensive income

     -        9        (1,967)        331        471        -        (1,156)        4        (1,151)  
                                                                                  

Total comprehensive income / (loss) for 2021

     -        392        (1,967)        331        471        -        (772)        7        (765)  

Issuance and purchase of (treasury) shares

     -        1        -        -        -        -        1        -        1  

Coupons on perpetual securities

     -        (9)        -        -        -        -        (9)        -        (9)  

Incentive plans

     -        -        -        -        -        5        5        -        5  

At end of period

     7,480        11,328        5,512        (2,203)        (82)        2,574        24,609        82        24,691  
1 

Please refer to the note on share capital for a breakdown.

2 

Issued capital and reserves attributable to owners of Aegon N.V.

 

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Table of Contents

Condensed consolidated interim financial statements

for the three-month period ended

March 31, 2022

 

 

Condensed consolidated cash flow statement

 

         
EUR millions   

1Q

2022

 

  

1Q

2021

 

   

Result before tax

   373    458
   

Results from financial transactions

   15,569    (2,490)
   

Amortization and depreciation

   330    274
   

Impairment losses

   10    11
   

Income from joint ventures

   (75)    (67)
   

Income from associates

   (34)    15
   

Release of cash flow hedging reserve

   (31)    (24)
   

Other

 

  

(307)

 

  

3

 

   

Adjustments of non-cash items

   15,461    (2,278)
   

Insurance and investment liabilities

   (1,603)    (1,387)
   

Insurance and investment liabilities for account of policyholders

   (15,159)    2,287
   

Accrued expenses and other liabilities

   443    (492)
   

Accrued income and prepayments

 

  

(1,546)

 

  

(109)

 

   

Changes in accruals

   (17,865)    298
   

Purchase of investments (other than money market investments)

   (6,018)    (10,683)
   

Purchase of derivatives

   (1,049)    (253)
   

Disposal of investments (other than money market investments)

   8,794    12,091
   

Disposal of derivatives

   74    (217)
   

Net purchase of investments for account of policyholders

   2,040    2,398
   

Net change in cash collateral

   (1,528)    (2,813)
   

Net purchase of money market investments

 

  

(194)

 

  

(502)

 

   

Cash flow movements on operating items not reflected in income

   2,118    21
   

Tax received / (paid)

   (21)    37
   

Other

 

  

3

 

  

(8)

 

   

Net cash flows from operating activities

   69    (1,473)
   

Purchase of individual intangible assets (other than VOBA and future servicing rights)

   (7)    (9)
   

Purchase of equipment and real estate for own use

   (17)    (10)
   

Acquisition of subsidiaries, net of cash

   (28)    -
   

Acquisition joint ventures and associates

   (30)    (9)
   

Disposal of subsidiaries, net of cash

   525    57
   

Dividend received from joint ventures and associates

 

  

22

 

  

9

 

Net cash flows from investing activities

   466    38
   

Purchase of treasury shares

   (50)    -
   

Proceeds from TRUPS1, subordinated loans and borrowings

   638    680
   

Repayment of TRUPS1, subordinated loans and borrowings

   (895)    (438)
   

Coupons on perpetual securities

   (3)    (12)
   

Payment of Right-of-use Assets

   (13)    (14)
   

Change in ownership non-controlling interests

 

  

(8)

 

  

-

 

Net cash flows from financing activities

 

  

(331)

 

  

215

 

Net increase / (decrease) in cash and cash equivalents 2

   203    (1,220)
   

Net cash and cash equivalents at the beginning of the reporting period

   6,889    8,372
   

Effects of changes in exchange rate

 

  

13

 

  

57

 

Net cash and cash equivalents at the end of the reporting period

 

  

7,105

 

  

7,209

 

1 Trust pass-through securities

2 Included in net increase / (decrease) in cash and cash equivalents are interest received EUR 1,446 million (2021: EUR 1,451 million) dividends received EUR 734 million (2021: EUR 756 million) and interest paid EUR 36 million (2021: EUR 9 million). All included in operating activities except for dividend received from joint ventures and associates EUR 22 million (2021: EUR 9 million).

 

Unaudited   LOGO


Table of Contents

Condensed consolidated interim financial statements

for the three-month period ended

March 31, 2022

 

Notes to the Condensed consolidated interim financial statements

Amounts are in EUR millions, unless otherwise stated.

Aegon N.V., incorporated and domiciled in the Netherlands, is a public limited liability company organized under Dutch law and recorded in the Commercial Register of The Hague under number 27076669 and with its registered address at Aegonplein 50, 2591 TV, The Hague, the Netherlands. Aegon N.V. serves as the holding company for the Aegon Group and has listings of its common shares in Amsterdam and New York.

Aegon N.V. (or ‘the Company’) and its subsidiaries (‘Aegon’ or ‘the Group’) have life insurance and pensions operations and are also active in savings and asset management operations, accident and health insurance, general insurance and to a limited extent banking operations. Aegon focuses on three core markets (the United States, the Netherlands, and the United Kingdom), three growth markets (Spain & Portugal, China, and Brazil) and one global asset manager. Headquarters are located in The Hague, the Netherlands. The Group employs over 21,000 people worldwide.

1. Basis of presentation

The condensed consolidated interim financial statements as at, and for the three-month period ended, March 31, 2022 (‘first quarter 2022’ or ‘1Q 2022’), have been prepared in accordance with IAS 34 ‘Interim Financial Reporting’, as adopted by the European Union (hereafter ‘EU-IFRS’). They do not include all of the information required for a full set of financial statements prepared in accordance with EU-IFRS and should therefore be read together with the 2021 consolidated financial statements of Aegon N.V. as included in Aegon’s Integrated Annual Report for 2021. Aegon’s Integrated Annual Report for 2021 is available on its website (aegon.com).

The condensed consolidated interim financial statements have been prepared in accordance with the historical cost convention as modified by the revaluation of investment properties and those financial instruments (including derivatives) and financial liabilities that have been measured at fair value. The condensed consolidated interim financial statements as at, and for the three-month period ended, March 31, 2022, were approved by the Supervisory Board on May 11, 2022.

The condensed consolidated interim financial statements are presented in euro (EUR) and all values are rounded to the nearest million unless otherwise stated. The consequence is that the rounded amounts may not add up to the rounded total in all cases.

The published figures in these condensed consolidated interim financial statements are unaudited.

2. Significant accounting policies

All accounting policies and methods of computation applied in the condensed consolidated interim financial statements are the same as those applied in the 2021 consolidated financial statements. New IFRS accounting standards and amendments that became effective on or after January 1, 2022 had no material impact on Aegon’s financial position or condensed consolidated interim financial statements (refer to paragraph 2.1).

2.1 New IFRS accounting standards effective from 2022

In 2022, the following amendments to existing standards issued by the IASB became effective:

    IAS 37 Provisions, Contingent Liabilities and Contingent Assets;

 

    IAS 16 Property, Plant and Equipment; and

 

    IFRS 3 Business Combinations.

2.2 Future adoption of new EU-IFRS accounting standards and amendments

For a complete overview of IFRS standards and amendments issued before January 1, 2022, which will be applied in future years and were not early adopted by the Group, please refer to Aegon’s Integrated Annual Report for 2021.

The IASB did not issue new amendments to its current standards in the three-month period ended, March 31, 2022.

 

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Table of Contents

Condensed consolidated interim financial statements

for the three-month period ended

March 31, 2022

 

2.3 Judgments and critical accounting estimates

Preparing the condensed consolidated interim financial statements requires management to make judgments, estimates and assumptions, including the likelihood, timing or amount of future transactions or events, that affect the application of accounting policies and the reported amounts of assets and liabilities, income and expense. These estimates are inherently subject to change and actual results could differ from those estimates.

Macro-economic context

In the first three-month period of 2022, we have seen the Russian invasion of Ukraine, which caused a humanitarian crisis and also impacted global financial markets and caused significant economic turbulence. Equity markets in Aegon’s three main markets decreased in the first quarter of 2022 compared to the growth of equity markets in 2021. Furthermore, although interest rates remain low, compared to December 31, 2021 interest rates have increased significantly in Aegon’s main markets. Additionally, credit spreads have widened compared to December 31, 2021 and affected Aegon’s results.

Uncertainty resulting from COVID-19

In the first three-month period of 2022 the COVID-19 pandemic continued to cause significant disruption to business, markets, and the industry. Progress on vaccinations has reduced the spread of COVID-19 and will likely continue to reduce the effects of the public health crisis on the economy. However, the pace of vaccinations has slowed down, and new strains of the virus and reduced availability of healthcare remain risks.

In the first three-month period of 2022 Aegon’s operating result in the Americas was impacted by EUR 102 million of adverse mortality in Life, of which EUR 55 million (first three-month period of 2021: EUR 79 million) of claims are directly attributable to COVID-19 as the cause of death. This was offset by favorable morbidity experience in Accident & Health and is mostly related to Long-Term Care insurance with higher claims terminations due to higher mortality and discharges from care facilities. In 1Q 2022, Aegon continue to observe positive morbidity in Long-Term Care, but less favorable when compared to prior year. In 1Q 2022, Aegon continued to release a portion of the Long-Term Care incurred but not reported (IBNR) reserve established during the peak of the pandemic.

Aegon Group’s Solvency II capital position remained at a strong level of 210% per March 31, 2022 (December 31, 2021: 211%).

Aegon continues to monitor the relevant market and the economic factors to proactively manage the associated risks. Management believes that the most significant risks are related to financial markets (particularly credit, equity, and interest rates risks) and underwriting risks (particularly related to mortality, morbidity, and policyholder behavior).

Actuarial and economic assumptions

In the first three-month period of 2022, Aegon implemented no actuarial assumption and model updates (first three-month period of 2021: EUR 51 million gain).

Sensitivities

Sensitivity on variable annuities and variable life insurance products in the United States

Sensitivities of Aegon’s variable annuities and variable life insurance products in the United States on expected long-term equity growth rate have not significantly changed compared to the sensitivities as reported in the Aegon’s 2021 Integrated Annual Report.

Sensitivity on liability adequacy test (LAT) in the Netherlands

At March 31, 2022 the liability adequacy test (LAT) of Aegon the Netherlands remains in a deficit position. The LAT assesses the adequacy of the insurance liabilities by comparing them to their fair value. Aegon the Netherlands adjusts the outcome of the LAT for certain unrealized gains in the bond portfolio and certain differences between the fair value and the book value of assets measured at amortized cost, mainly residential mortgages. Please also refer to Note 2.19f Liability adequacy testing of Aegon’s 2021 Integrated Annual Report for further details on the accounting policy.

 

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Table of Contents

Condensed consolidated interim financial statements

for the three-month period ended

March 31, 2022

 

The LAT deficit per March 31, 2022 in Aegon the Netherlands amounted to EUR 3.4 billion (December 31, 2021: EUR 5.2 billion), which was partially offset by the shadow loss recognition of EUR 1.5 billion (December 31, 2021: EUR 3.0 billion), resulting in a net deficit of EUR 1.9 billion (December 31, 2021: EUR 2.2 billion). The improvement of the LAT deficit by EUR 0.3 billion is driven by market movements (mainly increased interest rates and widening credit spreads, partly offset by the increased inflation curve) and is recorded in the income statement as part of benefits and expenses for the three-month period ended March 31, 2022.

Sensitivities of Aegon the Netherlands on bond credit spread, mortgage spread and liquidity premium assumptions to assess the impact on the LAT have not significantly changed compared to the sensitivities as reported in the 2021 Aegon’s Integrated Annual Report, except for sensitivities to interest rates. Following a decrease in the LAT deficit position per March 31, 2022 compared to December 31, 2021 the sensitivity to interest rates has changed. An increase of 100 bps in interest rates would result in a decrease in LAT deficit of EUR 2.8 billion (December 31, 2021: EUR 3.3 billion). A decrease of 100 bps would result in an increase in LAT deficit of approximately EUR 3.6 billion (December 31, 2021: EUR 4.3 billion).

2.4 Other

Taxes

Taxes on income for the three-month period ended March 31, 2022, are calculated using the tax rate that is estimated to be applicable to earnings for the full year.

Exchange rates

Assets and liabilities of foreign operations are translated to the presentation currency at the closing rates on the reporting date. Income, expenses and capital transactions (such as dividends) are translated at average exchange rates or at the prevailing rates on the transaction date, if more appropriate. The following exchange rates (most relevant rates to Aegon) are applied for the condensed consolidated interim financial statements:

Closing exchange rates

 

              

 

 USD

 

 

 

 GBP

 

         

 

March 31, 2022

 

 

 

1  

 

 

 

EUR    

 

 

 

 1.1126

 

 

 

 0.8450

 

     

 

December 31, 2021

 

 

 

1  

 

 

 

EUR    

 

 

 

 1.1372

 

 

 

 0.8396

 

     

Weighted average exchange rates

 

             
              

 

 USD

 

 

 

 GBP

 

         

 

Three months ended March 31, 2022

 

 

 

1  

 

 

 

EUR    

 

 

 

 1.1220

 

 

 

 0.8365

 

     

 

Three months ended March 31, 2021

 

 

 

1  

 

 

 

EUR    

 

 

 

 1.2046

 

 

 

 0.8737

 

     

 

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Condensed consolidated interim financial statements

for the three-month period ended

March 31, 2022

 

3. Segment information

3.1 Segment results

 

EUR millions   Americas     The
Netherlands
    United
Kingdom
    International     Asset
management
    Holdings and
other
activities
    Eliminations     Segment
total
    Joint
ventures and
associates
eliminations
    Consolidated  

Three months ended March 31, 2022

                       
     

Operating result geographically

    166       187       51       47       68       (55     -       463       17       480  

Fair value items

    (423     (73     53       9       -       (19     -       (452     (47     (499
Realized gains / (losses) on investments     13       61       -       (5     4       -       -       73       (2     71  

Impairment charges

    (6     3       -       (1     -       (18     -       (21     1       (20

Impairment reversals

    2       -       -       -       -       -       -       2       -       2  

Non-operating items

    (414     (8     53       3       3       (37     -       (399     (48     (447

Other income / (charges)

    4       16       (23     367       (8     (26     -       330       10       339  
     

Result before tax

    (244     195       81       417       64       (118     -       394       (21     373  

Income tax (expense) / benefit

    68       (39     (3     (10     (23     24       -       18       21       39  
     

Net result

    (176     156       78       408       41       (93     -       412       -       412  
     

Inter-segment operating result after tax

    (66     (24     (20     (6     47       68              
     

Revenues

                       

Life insurance gross premiums

    1,787       342       1,112       394       -       -       -       3,636       (307     3,329  

Accident and health insurance

    337       144       -       125       -       -       -       606       (40     567  

Property & casualty insurance

    -       35       -       46       -       -       -       81       (46     35  
     

Total gross premiums

    2,124       522       1,112       565       -       -       -       4,323       (393     3,930  

Investment income

    779       403       802       94       3       115       (119     2,078       (23     2,055  

Fee and commission income

    499       85       55       12       190       -       (46     795       (75     720  

Other revenues

    -       -       -       5       4       -       -       9       (9     -  
     

Total revenues

    3,403       1,010       1,969       677       197       115       (165     7,205       (499     6,706  
     

Inter-segment revenues

    -       2       -       -       46       117                                  

 

EUR millions   Americas     The
Netherlands
    United
Kingdom
    International     Asset
management
    Holdings and
other
activities
    Eliminations     Segment
total
    Joint
ventures and
associates
eliminations
    Consolidated  

Three months ended March 31, 2021

                       
     

Operating result geographically

    161       184       3 9       30       75       (58     ( 1     431       (43     388  
     

Fair value items

    (52     71       (48     -       (2     34       2       3       19       22  
     

Realized gains / (losses) on investments

    21       9       -       -       2       -       -       31       (3     28  
     

Impairment charges

    (4     2       -       -       -       (1     -       (3     -       (3
     

Impairment reversals

    9       1       -       -       -       8       -       19       -       19  
     

Non-operating items

    (25     82       (48     -       (1     41       2       50       16       66  
     

Other income / (charges)

    (7     33       (3     15       (2     (35     -       1       3       4  
     

Result before tax

    129       299       (12     44       72       (52     1       482       (24     458  
     

Income tax (expense) / benefit

    (7     (71     -       (8     (21     10       -       (96     24       (72
     

Net result

    122       228       (11     37       52       (42     1       386       -       386  
     

Inter-segment operating result after tax

    (7     (22     (22     (8     46       12              
     

Revenues

                       
     

Life insurance gross premiums

    1,650       392       1,143       381       -       -       -       3,566       (255     3,311  
     

Accident and health insurance

    315       142       3       119       -       -       -       579       (33     547  
     

Property & casualty insurance

    -       33       -       107       -       -       -       140       (40     100  
     

Total gross premiums

    1,965       5 6 8       1,146       607       -       -       -       4,285       (327     3,958  
     

Investment income

    705       501       819       88       2       59       (64     2,110       (17     2,093  
     

Fee and commission income

    473       72       51       14       213       -       (44     779       (104     674  
     

Other revenues

    -       -       -       2       -       -       -       3       (3     -  
     

Total revenues

    3,143       1,140       2,015       712       216       59       (108     7,177       (451     6,725  
     

Inter-segment revenues

    -       4       -       -       44       60                                  

Aegon’s segment information is prepared by consolidating on a proportionate basis Aegon’s joint ventures and associated companies.

 

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Table of Contents

Condensed consolidated interim financial statements

for the three-month period ended

March 31, 2022

 

Aegon has changed the grouping of the operating segments included in the performance measure. As per January 1, 2022, Mongeral Aegon Group (MAG Seguros) is no longer reported within the Americas segment, but reported in the International segment. The comparative figures in the segment results table have been adjusted to reflect this change, enabling a like for like comparison, which includes reclassifications between Americas and International for an operating result of EUR 2 million, life insurance gross premiums of EUR 41 million and Other revenues of EUR 2 million. There is no impact on the consolidated numbers of Aegon.

3.2 Investments

 

EUR Millions    Americas      The
Netherlands
     United
Kingdom
     International      Asset
Management
    

 

Holding and
other
activities

    Eliminations     Total  

March 31, 2022

                         
     

Investments

                         

Shares

     483        1,411        29        10        9        1       -       1,943  

Debt securities

     56,765        22,339        1,078        7,266        11        -       -       87,460  

Loans

     11,752        35,473        -        84        -        38       -       47,346  

Other financial assets

     8,663        78        807        101        104        -       -       9,753  

Investments in real estate

     41        2,681        -        16        -        -       -       2,738  
     

Investments general account

     77,703        6 1,981        1,9 14        7,478        12 4        3 9       -       149,240  

Shares

     -        8,498        18,261        13        -        -       (4     26,767  

Debt securities

     -        10,899        7,155        21        -        -       -       18,075  

Unconsolidated investment funds

     107,979        1,064        72,387        493        -        -       -       181,923  

Other financial assets

     -        3,444        5,272        6        -        -       -       8,722  

Investments in real estate

     -        -        591        -        -        -       -       591  
     

Investments for account of policyholders

     107,979        23 ,9 05        103,665        53 2        -        -       ( 4     236,078  
     

Investments on balance sheet

     185,682        85,887        105,580        8,010        124        39       (4     385,319  

Off balance sheet investments third parties

     233,122        7,705        142,603        3,408        206,954        -       -       593,792  
     

Total revenue generating investments

     418,804        93,592        248,183        11,419        207,078        39       ( 4     979,111  
     

Investments

                         

Available-for-sale

     61,976        21,244        1,383        7,364        85        -       -       92,053  

Loans

     11,752        35,473        -        84        -        38       -       47,346  

Financial assets at fair value through profit or loss

     111,914        26,489        103,606        546        39        1       (4     242,591  

Investments in real estate

     41        2,681        591        16        -        -       -       3,329  
     

Total investments on balance sheet

     185,682        85,887        105,580        8 ,0 10        12 4        3 9       ( 4     385,319  
     

Investments in joint ventures

     -        362        -        1,033        415        (1     -       1,809  

Investments in associates

     -        1,140        8        21        154        20       (12     1,330  

Other assets

     38,033        13,178        4,171        2,900        447        29,445       (28,337     59,838  
     

Consolidated total assets

     223,716        100,567        109,758        11,964        1,141        29,503       (28,353     448,296  

 

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Condensed consolidated interim financial statements

for the three-month period ended

March 31, 2022

 

                 
EUR Millions    Americas     

The

Netherlands

     United
Kingdom
     International     

Asset

Management

     Holding and
other
activities
     Eliminations     Total  

December 31, 2 021

                        
   

Investments

                        
   

Shares

     493        1,410        29        72        9        1        -       2,015  
   
Debt securities      61,014        26,951        1,159        8,060        11        -        -       97,195  
   

Loans

     11,352        35,990        -        93        -        20        -       47,455  
   

Other financial assets

     8,040        79        687        73        276        -        -       9,155  
   

Investments in real estate

     39        2,588        -        16        -        -        -       2,643  
                 

Investments general account

     80,938        67,0 17        1,8 76        8,315        296        21        -       158,463  
   

Shares

     -        9,078        20,221        243        -        -        (4     29,539  
   

Debt securities

     -        12,044        7,649        128        -        -        -       19,821  
   

Unconsolidated investment funds

     115,596        1,059        74,698        597        -        -        -       191,950  
   

Other financial assets

     -        3,493        5,581        6        -        -        -       9,080  
   

Investments in real estate

     -        -        563        -        -        -        -       563  
                 

Investments for account of policyholders

     115,596        25,6 73        108,713        9 74        -        -        ( 4     250,953  
   

Investments on balance sheet

     196,534        92 ,6 9 0        110,589        9,288        296        21        ( 4     409,416  
   

Off balance sheet investments third parties

     239,566        7,711        151,097        2,982        212,779        -        -       614,136  
                 

Total revenue generating investments

     436,100        100,402        261,687        12,270        213,076        21        ( 4     1,023,552  
   

Investments

                        
   

Available-for-sale

     65,694        24,443        1,299        8,191        257        -        -       99,884  
   

Loans

     11,352        35,990        -        93        -        20        -       47,455  
   

Financial assets at fair value through profit or loss

     119,450        29,669        108,727        987        40        1        (4     258,871  
   

Investments in real estate

     39        2,588        563        16        -        -        -       3,206  
                 

Total investments on balance sheet

     196,534        92 ,6 9 0        110,589        9,288        296        21        ( 4     409,416  
   

Investments in joint ventures

     56        343        -        936        368        39        -       1,743  
   

Investments in associates

     -        1,103        9        18        151        20        (12     1,289  
   

Other assets

     37,447        13,271        3,160        2,736        510        33,444        (34,133     56,436  
   

Consolidated total assets

     234,037        10 7,4 0 8        113,758        12,979        1,326        33,525        (34,149     468,884  

Amounts included in the tables on investments are presented on an EU-IFRS basis, which means that investments in joint ventures and associates are not consolidated on a proportionate basis. Instead, these investments are included on a single line using the equity method of accounting.

Aegon has changed the grouping of the operating segments included in the performance measure as of 2022. As per January 1, 2022, Mongeral Aegon Group (MAG Seguros) is no longer reported within the Americas segment, but is reported in the International segment. This change is applied prospectively in the investments overview.

 

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Condensed consolidated interim financial statements

for the three-month period ended

March 31, 2022

 

4. Premium income and premiums paid to reinsurers

 

     
                
   
EUR millions   

1Q

2022

    

1Q

2021

   

Premium income

       

Life insurance

     3,329      3,311

Non-life insurance

     602      647

Total premium income

     3,930      3 ,958

Accident and health insurance

     567      547

Property & casualty insurance

     35      100

Non-life Insurance premium income

     602      647
   

Premiums paid to reinsurers 1

       

Life insurance

     519      497

Non-life insurance

     46      47

Total premiums paid to reinsurers

     565      545

Accident and health insurance

     41      40

Property & casualty insurance

     5      7

Non-life Insurance paid to reinsurers

     46      47

 

  1 

Premiums paid to reinsurers are recorded within Benefits and expenses in the income statement - refer to note Benefits and expenses.

5. Investment income

 

     
                  
   
EUR millions   

1Q

2022

    

1Q

2021

 
   

Interest income

     1,277        1,297  

Dividend income

     749        772  

Rental income

     29        24  

Total investment income

     2,055        2,093  
   

Investment income related to general account

     1,179        1,186  

Investment income for account of policyholders

     876        907  

Total

     2,055        2,093  

 

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Condensed consolidated interim financial statements

for the three-month period ended

March 31, 2022

 

6. Results from financial transactions

 

     
                  
EUR millions    1Q
2022
     1Q
2021
 
   

Net fair value change of general account financial investments at FVTPL other

       
   

than derivatives

     208        54  
   

Realized gains /(losses) on financial investments

     67        39  
   

Gains /(losses) on investments in real estate

     86        (43
   

Net fair value change of derivatives

     (1,444      (1,011
   

Net fair value change on for account of policyholder financial assets at FVTPL

     (14,406      2,710  
   

Net fair value change on investments in real estate for account of policyholders

     29        3  
   

Net foreign currency gains /(losses)

     76        135  
   

Net fair value change on borrowings and other financial liabilities

     2        -  
   

Total

     (15,383      1,886  

Net fair value change on for account of policyholder financial assets at fair value through profit or loss are a charge in 1Q 2022, mainly due to declining equity markets, rising interest rates and credit spread widening in 1Q 2022 compared to December 31, 2021. Net fair value changes on for account of policyholder financial assets at fair value through profit or loss are offset by changes in technical provisions reported as part of the lines “Change in valuation of liabilities for insurance contracts” and “Change in valuation of liabilities for investment contracts” in note 8 Benefits and expenses.

7. Other income

Other income includes the book gain on the divestment of Aegon Hungary to Vienna Insurance Group AG Wiener Versicherung Gruppe (VIG), amounting to EUR 372 million. For more information on this divestment refer to note 18 Acquisitions/Divestments.

8. Benefits and expenses

 

     
                  
EUR millions    1Q
2022
     1Q
2021
 
   

Claims and benefits

     (8,607      8,141  

Employee expenses

     511        490  

Administration expenses

     358        376  

Deferred expenses

     (194      (146

Amortization charges

     244        205  

Total

     (7,688      9,066  

 

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Table of Contents

Condensed consolidated interim financial statements

for the three-month period ended

March 31, 2022

 

     
                 
   
EUR millions   1Q
2022
    1Q
2021
 
   

Benefits and claims paid life

    5,603       6,263  
   

Benefits and claims paid non-life

    352       347  
   

Change in valuation of liabilities for insurance contracts

    (12,210     769  
   

Change in valuation of liabilities for investment contracts

    (3,517     (357
   

Other

    12       (2
   

Policyholder claims and benefits

    (9,760     7,019  
   

Premium paid to reinsurers

    565       545  
   

Profit sharing and rebates

    2       2  
   

Commissions

    586       576  
   

Total

    (8,607     8,141  

The lines “Change in valuation of liabilities for insurance contracts” and “Change in valuation of liabilities for investment contracts” reflect changes in technical provisions resulting from “Net fair value changes on for account of policyholder financial assets at fair value through profit or loss” included in note 6 Results from financial transactions. In addition, the line “Change in valuation of liabilities for insurance contracts” includes the movement of the technical provisions for life insurance contracts.

9. Income tax

The income tax benefit for 1Q 2022 amounts to EUR 39 million and includes recurring beneficial impacts of tax-exempt income and US tax credits. Non-taxable income in 1Q 2022 is related to tax exempt result in the Netherlands on the sale of the Hungarian business as well as the regular non-taxable items such as the dividend received deduction in the United States and the participation exemption in the Netherlands. Tax credits mainly include tax benefits from United States investments that provide affordable housing to individuals and families that meet median household income requirements.

10. Investments

 

     
                  
     

EUR millions

    March 31, 2022        December 31, 2021  
     

Available-for-sale (AFS)

    92,053        99,884  
     

Loans

    47,346        47,455  
     

Financial assets at fair value through profit or loss (FVTPL)

    7,103        8,481  
     

Financial assets, for general account, excluding derivatives

    14 6 ,50 2        155,8 2 0  
     

Investments in real estate

    2,738        2,643  
     

Total investments for general account , excluding derivatives

    14 9 ,2 4 0        158 ,4 6 3  

 

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Table of Contents

Condensed consolidated interim financial statements

for the three-month period ended

March 31, 2022

 

 

Financial assets, for general account, excluding derivatives

 

 

EUR millions   AFS     FVTPL     Loans     Total  
   

Shares

    293       1,650       -       1,943  
   

Debt securities

    85,627       1,833       -       87,460  
   

Money market and other short-term investments

    5,125       87       -       5,212  
   

Mortgages loans

    -       -       40,572       40,572  
   

Private loans

    -       -       4,772       4,772  
   

Deposits with financial institutions

    -       -       63       63  
   

Policy loans

    -       -       1,936       1,936  
   

Other

    1,007       3,534       3       4,544  
   

March 31, 2022

    92,053       7,103       47,346       146,502  
   
     AFS     FVTPL     Loans     Total  

Shares

    350       1,665       -       2,015  
   

Debt securities

    93,899       3,296       -       97,195  
   

Money market and other short-term investments

    4,790       120       -       4,910  
   

Mortgages loans

    -       -       40,624       40,624  
   

Private loans

    -       -       4,883       4,883  
   

Deposits with financial institutions

    -       -       52       52  
   

Policy loans

    -       -       1,893       1,893  
   

Other

    844       3,401       3       4,248  
   

December 31, 2021

    99,884       8,481       47,455       155,820  

Total investments for general account, excluding derivatives, in the first three months of 2022 decreased, compared to the position at December 31, 2021, mainly due to rising interest rates and credit spread widening affecting bond valuation in mainly the Americas and the Netherlands.

11. Investments for account of policyholders

 

 

                                 

 

 

   

EUR millions

     March 31, 2022        December 31, 2021  
   

Shares

     26,767        29,539  
   

Debt securities

     18,075        19,821  
   

Money market and short-term investments

     1,739        1,482  
   

Deposits with financial institutions

     3,539        4,105  
   

Unconsolidated investment funds

     181,923        191,950  
   

Other

     3,444        3,493  
   

Total investments for account of policyholders at fair value through profit or loss, excluding derivatives

     235,488        250,390  
   

Investment in real estate

     591        563  
   

Total investments for account of policyholders

     236, 078        250,953  

Investments for account of policyholders in the first three months of 2022 decreased, compared to the position at December 31, 2021, mainly due to declining equity markets, rising interest rates and credit spread widening.

 

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Table of Contents

Condensed consolidated interim financial statements

for the three-month period ended

March 31, 2022

 

12. Fair value

The following tables provide an analysis of financial instruments recorded at fair value on a recurring basis by level of the fair value hierarchy:

 

 

Fair value hierarchy

 

 

      M arch 31, 2022      December 31, 2021  
EUR millions    Level I      Level II      Level III     Total      Level I      Level II      Level III     Total  
       
Financial assets carried at fair value                            

Available-for-sale investments

                           

Shares

     22        75        195       293        84        75        191       350  

Debt securities

     21,641        63,124        863       85,627        25,166        68,131        603       93,899  

Money markets and other short-term instruments

     1,176        3,949        -       5,125        1,204        3,586        -       4,790  

Other investments at fair value

     -        390        617       1,007        -        246        599       844  

Total Available-for-sale investments

     22,839        67,53 7        1,676       92,053        26,453        72,038        1,393       99,884  
       

Fair value through profit or loss

                           

Shares

     74        226        1,349       1,650        85        237        1,343       1,665  

Debt securities

     117        1,707        9       1,833        130        3,161        5       3,296  

Money markets and other short-term instruments

     18        69        -       87        18        102        -       120  

Other investments at fair value

     1        350        3,183       3,534        2        389        3,010       3,401  

Investments for account of policyholders 1

     119,705        115,212        571       235,488        129,794        119,653        943       250,390  

Derivatives

     328        7,553        2       7,882        150        8,676        1       8,827  

Total Fair value through profit or loss

     120,242        125,117        5,114       250,473        130,178        132,219        5,301       267,698  

Total financial assets at fair value

     143,082        192,654        6,790       342,526        156,631        204,256        6,694       367,582  
       

Financial liabilities carried at fair value

                           

Investment contracts for account of policyholders 2

     -        68,339        (96     68,244        -        71,249        (6     71,242  

Derivatives

     136        8,833        2,685       11,654        39        7,162        3,437       10,639  

Total financial liabilities at fair value

     136        77,173        2,589       79,898        39        78,411        3,431       81,881  

 

  1 

The investments for account of policyholders included in the table above represents only those investments carried at fair value through profit or loss.

  2 

The investment contracts for account of policyholders included in the table above represents only those investment contracts carried at fair value.

  3 

Total borrowings on the statement of financial position contain borrowings carried at amortized cost that are not included in the above schedule.

Significant transfers between Level I, Level II and Level III

In 1Q 2022, there are no transfers between Level I and Level II for financial assets and financial liabilities recorded at fair value on a recurring basis. Transfers are identified based on transaction volume and frequency, which are indicative of an active market.

 

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Table of Contents

Condensed consolidated interim financial statements

for the three-month period ended

March 31, 2022

 

Movements in Level III financial instruments measured at fair value

The following table summarizes the change of all assets and liabilities measured at estimated fair value on a recurring basis using significant unobservable inputs (‘Level III’), including realized and unrealized gains (losses) of all assets and liabilities and unrealized gains (losses) of all assets and liabilities still held at the end of the respective period.

 

Roll forward of Level III financial instruments

 

For the period ended M arch 3 1, 2022

 

 

                                                                         
   
EUR millions    At January
1, 2022
    Total gains
/ losses in
income
statement 1
    Total gains
/ losses in
OCI 2
    Purchases     Sales     Settlements     Net
exchange
differences
     Transfers
from
Level I and
Level II
     Transfers
to
Level I and
Level II
    At March
31, 2022
    Total unrealized
gains and losses
for the period
recorded in the
P&L for
instruments held
at M arch 31,
2022 ³
 

Financial assets carried at fair value available-for-sale investments

                            

Shares

     191       1       11       (1     (12     -       4        -        -       195       -  

Debt securities

     603       (2     (41     413       (47     (9     8        4        (66     863       -  

Other investments at fair value

     599       (20     8       39       (17     (4     13        -        -       617       -  
       1,393       (20     (22     451       (76     (13     25        4        (66     1,676       -  
     

Fair value through profit or loss

                            

Shares

     1,343       42       -       29       (65     -       -        -        -       1,349       42  

Debt securities

     5       -       -       27       (23     -       -        -        -       9       -  

Other investments at fair value

     3,010       222       -       89       (203     -       66        -        -       3,183       74  

Investments for account of policyholders

     943       (7     -       (372     6       -       1        -        -       571       (62

Derivatives

     1       1       -       -       -       -       -        -        -       2       1  
       5,301       2 58       -       (227     (284     -       67        -        -       5,114       54  
                                                                                            
     

Total assets at fair value

     6,694       237       (22     224       (361     (13     91        4        (66     6,790       54  
     

Financial liabilities carried at fair value

                            

Investment contracts for account of policyholders

     (6     (8     -       (197     115       -       1        -        -       (96     (8

Derivatives

     3,437       (790     -       -       (3     -       40        -        -       2,685       607  
       3,431       (798     -       (197     112       -       41        -        -       2,589       599  

1 Includes impairments and movements related to fair value hedges. Gains and losses are recorded in the line item results from financial transactions of the income statement .

2 Total gains and losses are recorded in line items gains/ (losses) on revaluation of available-for-sale investments and (gains)/ losses transferred to the income statement on disposal and impairment of available-for-sale investment of the statement of other comprehensive income.

3 Total gains / (losses) for the period during which the financial instrument was in Level III.

 

Roll forward of Level III financial instruments

 

For the period ended December 3 1, 2021

 

 

                                                                          
   
      At January
1, 2021
    Total gains
/ losses in
income
statement 1
    Total gains
/ losses in
OCI 2
     Purchases     Sales     Settlements     Net
exchange
differences
     Transfers
from
Level I and
Level II
     Transfers
to
Level I and
Level II
    At
December
31, 2021
    Total unrealized
gains and losses
for the period
recorded in the
P&L for
instruments held
at December 31,
2021
 

Financial assets carried at fair value available-for-sale investments

                             

Shares

     173       1       3        30       (26     -       11        -        -       191       -  

Debt securities

     467       (1     6        228       (29     (46     22        203        (246     603       -  

Other investments at fair value

     581       (113     7        111       (24     (6     43        -        -       599       -  
       1,221       (114     16        368       (80     (52     77        203        (246     1,393       -  
     

Fair value through profit or loss

                             

Shares

     1,329       150       -        179       (316     1       1        -        -       1,343       147  

Debt securities

     242       (1     -        124       (361     -       -        -        -       5       1  

Other investments at fair value

     2,173       796       -        492       (638     -       186        -        -       3,010       (1

Investments for account of policyholders

     1,012       206       -        (198     (93     -       22        -        (7     943       162  

Derivatives

     22       (17     -        -       (4     -       -        -        -       1       (10
       4,779       1,13 4       -        59 7       (1,411     -       210        -        (7     5,301       299  
                                                                                             

Total assets at fair value

     6,000       1,020       16        965       (1,491     (52     286        203        (253     6,694       299  
     

Financial liabilities carried at fair value

                             

Investment contracts for account of policyholders

     (12     (1     -        (361     366       -       2        -        -       (6     3  

Derivatives

     4,902       (1,627     -        -       (14     -       176        -        -       3,437       607  
       4,890       (1,628     -        (361     352       -       178        -        -       3,431       610  

1 Includes impairments and movements related to fair value hedges. Gains and losses are recorded in the line item results from financial transactions of the income statement .

2 Total gains and losses are recorded in line items gains/ (losses) on revaluation of available-for-sale investments and (gains)/ losses transferred to the income

statement on disposal and impairment of available-for-sale investment of the statement of other comprehensive income.

3 Total gains / (losses) for the period during which the financial instrument was in Level III.

 

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Table of Contents

Condensed consolidated interim financial statements

for the three-month period ended

March 31, 2022

 

Fair value information about financial instruments not measured at fair value

The following table presents the carrying values and estimated fair values of financial assets and liabilities, excluding financial instruments which are carried at fair value on a recurring basis.

 

 

Fair value information about financial instruments not measured at fair value

 

 

      Carrying
amount
     Total estimated fair
value
     Carrying
amount
     Total estimated fair
value
 

EUR millions

     March 31, 2022        December 31, 2021  

Assets

               

Mortgage loans - held at amortized cost

     40,572        41,941        40,624        44,366  

Private loans - held at amortized cost

     4,772        5,002        4,883        5,491  

Other loans - held at amortized cost

     2,002        2,002        1,949        1,949  
     

Liabilities

               

Subordinated borrowings - held at amortized cost

     2,227        2,305        2,194        2,438  

Trust pass-through securities - held at amortized cost

     122        133        126        139  

Borrowings – held at amortized cost

     9,459        10,069        9,661        10,171  

Investment contracts - held at amortized cost

     21,904        21,032        21,573        20,861  

Financial instruments for which carrying value approximates fair value

Certain financial instruments that are not carried at fair value are carried at amounts that approximate fair value, due to their short-term nature and generally negligible credit risk. These instruments include cash and cash equivalents, short-term receivables and accrued interest receivable, short-term liabilities, and accrued liabilities. These instruments are not included in the table above.

13. Share capital