Company: AEGOF
Filing Date: 2025-05-16
Form Type: 6-K
Source: 0001193125-25-121236
Chunk: 44

Company: AEGON LTD.
Filing Date: 2025-05-16
Form: 6-K
Chunk 44
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 sources of liquidity. Many of Aegon’s derivative transactions require Aegon to pledge collateral against declines in the value of these contracts. Volatile financial markets may significantly increase requirements to pledge collateral and adversely affect Aegon’s liquidity position. Furthermore, a downgrade of Aegon’s credit ratings may also result in additional collateral requirements and affect Aegon’s liquidity. Any security Aegon issues in significant volume may be issued at higher financing costs if funding conditions are impaired, as they have been from time to time in recent years. The requirement to issue securities can be driven by a variety of factors. For instance, Aegon may need liquidity for operating expenses, debt servicing and the maintenance of capital levels of insurance subsidiaries. Although Aegon manages its liquidity position for extreme events, including greatly reduced liquidity in capital markets, if these conditions were to persist for an extended period of time, it is possible that it would be necessary for Aegon to sell assets substantially below prices at which they are currently recorded to meet its insurance obligations. C.1.5 Operational risk Operational risk description Aegon Group faces operational risk resulting from operational failures or external events. Aegon defines operational risk as a potential event that may result in (complete or partial) non-achievementof the Company’s business objectives. Operational risk is further defined as the risk of unexpected consequences like financial losses, reporting errors, customer detriment, non-complianceto regulatory requirements and perceived negative reputation resulting from inadequate or failed internal processes and controls, people and systems or from external events. This definition highlights the four causes of operational risk events: (1) external events; (2) inadequate or failing processes and controls; (3) people; and (4) systems. Aegon’s systems and processes are designed to support complex products and transactions, and to help protect against such issues as system failures, business disruption, financial crime, and breaches of information security. Aegon monitors and analyses these risks, and retains flexibility to update and revise where necessary. Operational risk assessment Aegon’s approach to evaluating operational risks is based on the quantitative and qualitative rating of those risks with regard to their potential impact and likelihood after consideration of the effectiveness of controls. Risk impact is assessed along the following five impact dimensions: financial loss, customer, reputational, regulatory and financial misstatement impact. The resulting ratings reflect the (residual) risk the business area is running. The senior management of each strategic business unit reports their forward-looking risk profile on a quarterly basis,