Aegon completes move to Bermuda
Dutch insurance giant Aegon is now officially domiciled in Bermuda.
Aegon shareholders spent the weekend following a complex process to bring about the company’s move from the Netherlands to Bermuda but as of today, the long term re/insurer is based in Bermuda and regulated by the Bermuda Monetary Authority.
The company will continue to be tax resident in the Netherlands.
On Saturday, shareholders agreed to move the company to Luxembourg because Dutch law does not facilitate a direct transfer of a legal domicile to a country outside of the European Economic Area. Therefore, Aegon first had to change its legal domicile to Luxembourg which does allow for such relocations.
Yesterday, shareholders approved the cross-border conversion into a Bermuda limited company.
Aegon said its shares will continue to be listed on Euronext Amsterdam (AGN) and NYSE (AEG). As at market open on October 2, 2023, trading will commence in Aegon Ltd. shares. The identifiers (such as the ISIN) of the Aegon shares will change:
- the Aegon Ltd. common shares will have the ISIN BMG0112X1056; and
- the Aegon Ltd. common shares held in New York registry form will have the ISIN US0076CA1045 and the CUSIP 0076CA 104.
Aegon decided to move to Bermuda comes after selling its Dutch life insurance business to its smaller rival SR for $5.34 billion.
Aegon still has assets of 440 billion euros and more than 20,000 employees around the world.
At the time the move was announced in July, Aegon said Aegon Bermuda hosted many respected international insurance companies, including four of Aegon's subsidiaries.
It said: “Bermuda’s regulatory regime is well recognised, having been granted equivalent status by the EU under the Solvency II regime, and by the UK under its own Solvency UK regime.
“It has also been designated as a qualified jurisdiction and reciprocal jurisdiction by the US National Association of Insurance Commissioners (NAIC). This enables insurance companies that are regulated by the BMA to easily conduct cross-border business.”
Lard Friese (pictured), Aegon’s chief executive officer, said: “Bermuda has an established, well-regarded regulatory regime that will facilitate the implementation of our strategy to build leaders in investment, protection and retirement solutions, as outlined at our recent Capital Markets Day.”
Aegon plans to continue with a $1.63 billion share buyback programme shortly after the closing of the transaction with ASR.
It said it expects its group solvency ratio and surplus under the Bermuda solvency framework to be broadly in line with that under the Solvency II framework during a transition period until the end of 2027.
It said the method to translate Transamerica’s capital position into the group solvency position will also be similar to the current methodology. After the transition period, Aegon will fully adopt the Bermudian solvency framework.
Aegon anticipates that its debt instruments that are currently grandfathered under the Solvency II regime will remain so until the end of 2025. In addition, Aegon’s debt instruments will continue to be subject to existing triggers for mandatory deferral or cancellation of interest payments or conversion into equity, based on the group solvency ratio.
Aegon said its future debt structure and refinancing decisions will remain primarily driven by economic considerations, taking into account investor expectations, market circumstances, regulatory requirements, and rating agency considerations. As previously announced, Aegon intends to reduce its gross financial leverage by up to $762 million (700 million euros) following the closing of the transaction with ASR.
Aegon added: “Aegon will apply well-recognised international governance standards to reflect the international footprint of Aegon following closing of the transaction with ASR.
“The new governance includes the implementation of a one-tier board structure, consisting of both executive and non-executive directors. The governance position of, and arrangements with, Vereniging Aegon will remain materially unchanged.”
Aegon has fully owned subsidiaries in the US, UK and also owns a global asset manager. It also has partnerships in Spain & Portugal, Brazil, and China.
Aegon subsidiary Transamerica Life Bermuda serves affluent and high-net-worth individuals across Asia and beyond. TLB provides life insurance products and services through its branches in Singapore, Hong Kong and Bermuda.
The company had a net loss of 2.5 billion euros in 2022 compared to a profit of 1.7 billion euros, largely due to non-recurring items. It has assets of 444 billion euros and more than 20,000 employees around the world.