Aegon earnings fall on weak dollar and charges

Aegon's pre-tax underlying earnings have fallen by €13m in the second quarter, to €401m, after the business was impacted by falls in the dollar and hefty charges for administration problems.

The group blamed the weak dollar for much of the fall, after it cost the group €44m.

It also cited exceptional charges for administration failings at Scottish Equitable - previously flagged up by the group - which cost it €23m in the Netherlands and €14m in the UK.

Net income rose to €404m during the period, up from €327m the previous quarter but lower than Q2 2010's income of €413m.

Alex Wynaendts, chief executive of Aegon, said:"The weakening of the US dollar had a notable impact on Aegon's reported results. Net income was strong for the quarter, however, underlying earnings were negatively affected by anticipated exceptional items in the United Kingdom and the Netherlands."

Wynaendts also warned the current environment remained challenging.

"Clearly, the current economic environment poses considerable challenges.

"However, we have implemented measures to strengthen and protect Aegon's balance sheet by reducing our exposure to equity and credit markets, as well as interest rate risks.

"At the same time, we are restructuring our businesses in our key markets. These actions, along with our very limited exposure to peripheral European countries, support our confidence in Aegon's growth prospects," he said.