Company: AEGOF
Filing Date: 2025-02-20
Form Type: 6-K
Source: 0001193125-25-030100
Chunk: 6

Company: AEGON LTD.
Filing Date: 2025-02-20
Form: 6-K
Chunk 6
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 portfolios as Financial Assets. Transamerica is taking in-forcemanagement actions on Financial Assets that are expected to reduce the capital employed together with the organic run-offof the portfolio to USD 2.2 billion by year-end2027. On December 31, 2024, Financial Assets had USD 3.4 billion of capital employed, a decrease of USD 0.7 billion compared with December 31, 2022, which is the reference date for this target. Of this decrease, USD 0.5 billion was achieved in 2024. The decrease was mainly driven by favorable market impacts in the variable annuities portfolio, the run-offof the portfolios, and management actions such as the earlier expansion of the dynamic hedging program for the Variable Annuities guaranteed benefits to include the lapse and mortality margins, as well as the reinsurance of a universal life portfolio. Universal Life The legacy Universal Life portfolio includes universal life policies with and without secondary guarantees. In addition, Transamerica has reinsured a Universal Life portfolio from Transamerica Life Bermuda. The portfolio is in run-offwith policies maturing or being surrendered over time. Consequently, the net face value of this portfolio – which reflects the face value of policies issued to policyholders adjusted for reinsurance coverage – decreased to USD 47 billion at the end of December 2024 compared with USD 51 billion at the end of 2023. Transamerica’s program to purchase institutionally owned policies has helped to reduce the exposure. In the second half of 2024, Transamerica achieved its target to purchase at least 40% of the USD 7 billion face value of institutionally owned universal life policies that were in-forceat the end of 2021, locking in claims cost and reducing the mortality risk of the overall portfolio. The program achieved the investment target at Aegon’s hurdle rates three years ahead of plan. At the same time, funding remains available for potential additional opportunistic purchases. So far, Transamerica has terminated around two thirds of the purchased face value. Of this, one third was terminated in the second half of 2024 with a one-timeunfavorable capital impact of around USD 300 million. The dedicated Transamerica entity that purchased these policies has returned part of its associated equity funding with a one-timefavorable capital impact of USD 150 million. These actions had a combined unfavorable impact on the RBC ratio of 8%-points in the second half of 2024. The