By Adam Clark

 

Aegon N.V. (AGN.AE) said Tuesday that it expects a one-off boost of $1.0 billion to its capital-generation from the merger of two of its U.S. businesses.

The Dutch insurance company said it will merge its Arizona-based vehicle for reinsuring variable annuities with its Transamerica Life Insurance Co. business.

"Merging two of our US entities simplifies our legal structure, increases our capital buffer and leads to the release of reserves and higher diversification benefits," said Chief Executive Alex Wynaendts

Aegon said changes to U.S. rules for variable annuity capital mean the use of its captive Arizona vehicle is no longer required.

Argon said the capital boost to its Solvency II capital ratio is expected to be largely offset by the effects of U.S. tax reform in the second half of 2018, and it doesn't expect any material impact on its recurring capital-generation.

 

Write to Adam Clark at adam.clark@dowjones.com; @AdamDowJones

 

(END) Dow Jones Newswires

September 25, 2018 03:04 ET (07:04 GMT)

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