Aegon Ltd. (AEG) Earnings Call Transcript & Summary

All right. Good afternoon, everybody, and welcome to Aegon's 2025 Capital Markets Day. My name is Yves Cormier. I'm the Head of Investor Relations. And on behalf of the entire team, I would like to welcome you today in the room and online. Our schedule for this afternoon is the following. So first, our CEO, Lard Friese, will present the group strategy, and he will also share the outcome of the review on the potential relocation of the group to the United States. Then our CFO, Duncan Russell, will share with you the details of our financial plans for the coming years. After that, we'll have a first Q&A session with Lard and Duncan. Then we'll have a short break. And then we'll come back to listen to first Will Fuller, CEO of our U.S. business, who will update you on the strategy of Transamerica. And finally, Shawn Johnson, CEO of Aegon Asset Management, who will take you through the Asset Management strategy. And then we'll have a second Q&A session. Before we start, I would appreciate it if you could take a moment to review our disclaimer on forward-looking statements at the back of the presentation. And with that, over to you, Lard. Thank you.

Yes. So good afternoon here in London. It's great to see all of you here. And hi to everybody, all our colleagues on the webcast and other investors and people who are watching. Good afternoon to all of you as well or good morning or wherever you are. Sorry to dump so much information on you this morning, so early. It's a bit of a long press release, and we have a lot to go through, so I suggest that we dive in immediately. So fellow stockholders, colleagues, investors and analysts. Today is an important milestone for Aegon. We are announcing a set of coordinated actions that will shape the future of our company. These decisions demonstrate our commitment to progress and our focus on delivering exceptional value to all stakeholders. I look forward to sharing these actions with you and to discuss their significance for Aegon and our stakeholders. So let me now take you first through the key announcements of today. Our ambition is clear. We want Aegon to become a leading force in the U.S. life insurance and retirement industry. This strategic objective sharpens our focus and supports our continued growth. We are redomiciling our headquarters and legal seat to the U.S., which is a pivotal moment in Aegon's history, and it positions us at the heart of the world's largest insurance market where we already have a strong and growing franchise. After the re-domiciliation to the U.S. is completed, we will rename the company, the holding company, to Transamerica Incorporated or Transamerica Inc. We have defined Aegon Asset Management strategy, and it is now fully aligned with our U.S. ambitions. Our leading U.S. life insurance and retirement company will be supported by a global Asset Management business. Shawn Johnson, the CEO of Aegon Asset Management, will explain more about this later today. We will continue to focus on the profitable growth of our international businesses. These are mainly joint ventures with strong local partners that are increasing in value as their growth plans unfold. On Aegon U.K., we are launching today a strategic review to determine how to maximize its value. Every option is under consideration as we pursue optimal outcomes, including a potential divestment. We are building the foundation to execute Aegon's U.S. strategy via an $800 million investment into Transamerica and a reinsurance transaction to derisk Transamerica's secondary guarantee universal life portfolio, which will reduce capital employed within Financial Assets by USD 300 million. The free cash flow per share will increase post the transaction, both relative to the situation we had pre-a.s.r. disposal and relative to an alternative of using the EUR 700 million to buy back shares. Duncan Russell, our Group CFO, will elaborate on this topic in his presentation later this afternoon. I'm proud to share that we are achieving all our financial targets for 2025, and we are communicating new financial ambitions today, including a dividend growth of over 5% per annum. This is supported by growth of free cash flow of around 5% per annum and growing OCG of between 0% and 5% per annum. Aegon's operating result is expected to grow by around 5% per annum as well. For the next year, we announced the intention of a new share buyback program of EUR 400 million, EUR 200 million of which will be executed in the first half of the year. For the onetime implementation of the relocation and the associated introduction of the U.S. GAAP accounting standard, we are setting aside a budget of EUR 350 million over the next 3 years. This investment is a commitment to our future, enabling us to operate with greater agility and comparability to peers. But to appreciate these steps fully, I believe it is important to place them in the recent transformation journey of this 180-year-old company. So let me take you back to -- back to 2020. Exactly 5 years ago, I stood before you to share my vision for Aegon, its potential, its challenges and its future. At that time, Aegon was a structural underperformer. Our strategy was unclear. Our global presence was sprawled across 20 markets, and we faced significant headwinds, a lack of strategic focus, suboptimal capital allocation, a volatile and leveraged capital position and a culture that was struggling with execution. We recognize the need for change. We set out to transform Aegon into a high-performing group of well-positioned businesses anchored by a solid balance sheet, exceptional customer service and engaged, well-trained employees operating in a select number of markets. Our transformation plan was bold and decisive. We focused on three core markets: the U.S., the Netherlands and the United Kingdom, alongside three growth markets: Iberia, China and Brazil and our global asset manager. We reallocated capital on a massive scale. We reduced exposure to low-return financial assets, and we increased investments in strategic assets with attractive returns. We acted decisively on subscale businesses or exited those in small markets. We substantially reduced group leverage, lowered our risk profile and built a rock-solid balance sheet. We aligned our organization with our strategy, building an execution muscle through a highly granular operating plan. And we installed and maintained a rational and disciplined decision-making process. Today, 5 years later, we can proudly say we have delivered or outperformed on all of the targets that we set and communicated at our Capital Markets Days in both 2020 and 2023. Aegon is now a much better performing company. We have wholly owned businesses in the U.S. and in the U.K., joint venture partnerships in Brazil, China and Spain and Portugal, a niche high net worth business in Singapore and Hong Kong, and the global asset manager. In the Netherlands, we contributed our businesses to a.s.r., creating a national champion in which we now hold a 24% stake. Our capital employed in low-returning financial assets has decreased significantly, while our capital employed in strategic assets where we generate attractive returns has increased. We reduced group leverage from EUR 6 billion to EUR 5 billion. We hold EUR 1.9 billion in Cash Capital at the holding, exceeding the high end of our target range, and we have grown dividend per share by double digits every year. By combining our Dutch business with a.s.r., we have created substantial additional value. We have used proceeds from this transaction to reduce group leverage, strengthen the balance sheet, reduce the share count and participate via our stake in the synergies that are created. The management team at a.s.r. is doing a great job in integrating Aegon's Dutch operations with their business. Since the transaction, our total shareholder return on the stake in the combined company was more than 50%. With the integration largely complete, I can announce today that I will step down from the Board of a.s.r. as soon as a successor nominated by Aegon is appointed. This will give me the time needed to focus fully on Aegon's further transformation and on our relocation to the U.S. Our business units are structurally well above their operating capital ratios. We are growing where we want to grow, and our overall returns are steadily improving. Over the past 5 years, our businesses have generated a cumulative cash flow net of capital injections of EUR 2.7 billion, and we have earned EUR 3.7 billion proceeds from making our company more focused. We returned the lion's share of this capital to bond and stockholders through leverage reduction, dividends and share buybacks, totaling around EUR 6.1 billion. We have remained rational and disciplined in all our decision-making, even when the decisions are difficult. We have always put our customers, employees and stockholders first. We have adapted the company to whatever change was required, such as moving the group's legal seat to Bermuda, adopting new governance and working with a new group regulator, the Bermuda Monetary Authority. Now we're ready. We're ready for our next step, our next frontier. Since the closing of the a.s.r. transaction and the subsequent move of the group to Bermuda in 2023, we have taken the time to evaluate our strategic options. And we have concluded that our future of our group is in the United States. In the world's largest and most dynamic insurance market, we are positioning ourselves to capture significant growth opportunities in life, protection and retirement solutions. This relocation is not just about geography. It's about ambition. We aim to build a bigger, broader and more profitable U.S. life insurance and retirement leader. And we want to enable this ambition by relocating our head office in legal seat to the U.S. as we want to be physically close to our main business. We want to simplify our setup and fully embrace everything we need to do to deliver on that ambition. We see the opportunity. We have the foundations. We have the execution muscle, the talent and the financial flexibility to make it happen. Once we have established ourselves as a domestic insurer in the U.S., we will continue our journey under the trusted Transamerica brand. We will seek shareholder approval for the domiciliation at an EGM to be organized in the fourth quarter of 2026. Our largest stockholder, the Vereniging Aegon, the Association Aegon, has taken note of the CMD press release this morning and considers the decision to relocate Aegon Limited to the U.S. as an important and positive step for Aegon. Ahead of the EGM, the association will review and constructively consider any forthcoming proposals in relation to the impact on the association of the proposed relocation to the U.S. Let me now explain the rationale for this decision and then discuss its implications for our company. So why the U.S.? The United States is the most innovative and vibrant economy in the world with structural incentives for economic growth. Through economic cycles, the U.S. economy has consistently proven to be more resilient than others. The U.S. life insurance market is the largest globally and the underlying trends favor our business. People live longer, protection gaps are widening, and there is much more work to be done to help American families prepare for retirement. American families need to save and invest more, not less. Millions of Americans are uninsured or underinsured. More families need financial protection and must ensure financially secure retirement. There is a $7 trillion gap between what Americans have saved for retirement and the amount they will ultimately require. And this presents a significant and compelling opportunity for us. Our customers have a growing and substantial need for financial planning and for advice. Now with Transamerica, we have a large and attractive business in the U.S., representing around 70% of Aegon's operations. We are a strong life insurance player, a selective annuity provider, a profitable midsized retirement player, and we own the second largest retail distribution force in North America with over 92,000 agents. Transamerica is growing, and we have made substantial progress in decreasing financial assets and increasing capital in strategic assets. We are well positioned to serve an underserved and large segment of the U.S. marketplace, American -- average American families and small- and medium-sized companies. Our broad distribution capability through our own network, WFG, banks, brokerage and third-party channels gives us unique access. Over the past 5 years, we have built a strong, experienced and execution-focused management team that is delivering on its plans. Will Fuller, the CEO of our North American businesses, will update you today on our organic plans for growth and value creation in the U.S. He will show you that we are on the path to become America's leading Main Street life insurance and retirement company. We are leveraging our strong brand, our unique customer access points and our top-tier distribution network to reach more families and businesses than ever before. In the coming years, we will further develop our distribution engine, grow the network of WFG agents and expand relationships with third-party providers. We have plans to modernize technology enabled by AI to meet evolving customer needs while maintaining a relentless focus on productivity. Leveraging our modern life operating model, we are expanding our product offering, scaling our franchise and increasing profitability. We will benefit from what we call compounding economics, and we will explain that further, building on our advanced distribution and broad product offering. Our retirement business has good momentum. We are leaders in pooled plans and stable value solutions, and our ancillary product strategy is delivering diversified, sustainable and growing revenue streams. We have taken decisive actions over the past years to reduce exposure to financial assets, including the Secondary Guarantee Universal Life reinsurance transaction announced today, which has significantly lowered risk, freed up capital employed and reduces results volatility. Our disciplined approach to managing legacy blocks ensures we remain resilient and focused on the future. Now while our focus is on our organic path, we will evaluate inorganic opportunities as they arise while maintaining the financial discipline and rational decision-making that you are used to get from us. The implications of our decision to focus on the U.S. are profound and are touching three key areas. Our portfolio, the organization and setup, and capital management. I will now outline the implications for each area, and I will start with our portfolio. While Transamerica is our core business, we will continue to create value from our other businesses. Aegon Asset Management will outline its strategy in more detail today. It is an attractive, growing medium-sized asset manager with around 70% of its assets generated from third-party mandates and joint ventures in China and France. We aim to grow Aegon Asset Management size and margins through efficiency measures, growth and a shift in mix to higher revenue margin strategies. This is expected to lead to a growing contribution to the group's operating results and steadily increasing remittances. Our U.K. team has presented its plans to build a leading digital savings and retirement platform in the U.K., and they are making good progress. But as mentioned earlier, we will -- we announced today a strategic review of our U.K. business to determine how we could accelerate to maximize its value. And all options are on the table. Aegon's 24% stake in a.s.r. is a testament to our strategic vision and ability to create and maximize value. We will hold this investment until the share price reflects the intrinsic value of the combined operation or use it as a meaningful part of our financial flexibility when value-creating opportunities present themselves. Our portfolio of international businesses in Spain, Portugal, Brazil, China and the high-net-worth business, TLB, they are profitable strategic investments that are increasing in value as their growth plans unfold. These businesses, mostly joint ventures with strong local partners, operate in some of the most promising markets in the world. They contribute, as you can see, significantly to our group with steadily growing operating results and remittances. Gross written premiums have grown consistently over the past 5 years. We will continue to support these businesses in their profitable growth plans built on product innovation, customer service and expanding distribution. In Spain, we plan to grow the business, leveraging the large network from Banco Santander, focusing on servicing our customers with excellence and attractive products. In Brazil, we want to continue our successful growth path as a top 3 independent life insurer. In China, we strengthen and expand our distribution with our preferred partners in this vast market while optimizing and preserving our capital position. At TLB, we are uniquely positioned to serve the high-net-worth community in Asia and the Middle East. We aim for a continuing increase in value of these businesses in the coming years. Let's go to the organization and setup. And let me share with you the organizational implications of the relocation to the U.S. as they are significant and they are identity defining. Aegon has always been an international group with strong Dutch roots deeply ingrained in our 180-year history.’ With the decision we announced today, Aegon fully embraces the reality of its business and prioritizes resources to build a leading franchise in the U.S. When the re-domiciliation process is completed and our legal seat moves to the U.S., Aegon Limited will rename itself to Transamerica Incorporated or Transamerica Inc. and become an American life insurance and retirement group with international insurance and Asset Management subsidiaries. This transition to the U.S. will simplify Aegon's profile and create a leaner, simpler and more focused enterprise. We will move our head office to the East Coast of the U.S., which is likely to be in New York and Philadelphia, where we already have offices. We expect our legal seat to move to Delaware in 2028. We will be subject to U.S. insurance supervision and become a U.S. tax resident. We will implement U.S. GAAP and aim to report on that basis as of the full year 2027, aligning our disclosures with the U.S. peer companies and facilitating easier comparison. We expect to move to quarterly disclosures as of 2028. To facilitate this process, which will take a lot of work, we will stop trading updates in 2026 and '27, limiting ourselves in this time to comprehensive half year reporting. We will maintain dual listings on Euronext and the New York Stock Exchange with common shares trading at both exchanges and aim for inclusion in U.S.-focused indices. U.S. investors are already a significant part of our register with 16% of common shares held in the U.S. dollars today and more than 1/3 of our shareholders being based in U.S. Today, around 9% of our outstanding shares are held by U.S. index investors. We are aiming to be included in more U.S.-focused stock indices once we are established as a domestic issuer in the U.S. We anticipate a gradual shift of our investor base to become more U.S. focused, which we expect to be accompanied with an increase in trading volumes in the U.S. over time. The relocation process will take 2 to 3 years with key milestones along the way. And I highlight our plan to call an EGM in the fourth quarter of 2026 to seek shareholder approval for the move to the U.S. We will give you regular updates on the time line on the way. In the second half of 2027, we plan to be ready to become a domestic issuer. At that time, we also expect to give you an update on our plans and ambitions for 2028 and the years beyond. Our aim is to report the full year 2027 results using the U.S. GAAP accounting standard for the first time. So let's move to capital management. In this transition, our overall approach to capital management will not change. We want our operating companies to be well capitalized and to maintain Cash Capital at the holding at around the midpoint level of the operating range of EUR 1 billion. Any excess capital will be returned to stockholders over time unless we can invest it in value-creating opportunities. This includes M&A with priority in the U.S. We will remain financially disciplined and rational in our decision-making when we assess acquisition opportunities. Within this policy, we are investing in future earnings power by growing our profitable product portfolio and accepting the capital needs associated with this growth. As such, we will continue to increase capital employed in strategic business lines with attractive returns and reduce capital in low-return financial assets. We will allocate capital to value-accretive opportunities and to initiatives that reduce our cost of capital. As we assume our new identity as a U.S.-based life insurance and retirement group over the next 2 to 3 years, we remain dedicated to our customers, providing the best products and services. We remain committed to rational decision-making, improving and growing our businesses. And we continue to be dedicated to the communities we serve to responsible stewardship of the resources entrusted to us and to maintaining a diverse and healthy workplace where everyone feels valued and can thrive. In the past 5 years, our objective was to focus, simplify and grow, and we delivered. Now we're moving to the next stage, our new frontier. Our financial ambitions are both bold and purposefully and fully aligned with the transformative strategy we have set in motion. In 2026 and '27, we aim to grow free cash flow and operating results by around 5% per annum and to increase the dividend per share by more than 5% annually. Our focus remains on accelerating profitable growth in our strategic business lines, investing in technology, distribution and product innovation. And as we grow our new sales volumes, we accept a higher new business strain, which is expected to result in 0% to 5% growth of the operating capital generation. These targets reflect our confidence in the strength and resilience of our business as well as our commitment to delivering superior value to our shareholders. And just as before, we will continue to sharpen our focus, to simplify further, to execute relentlessly and to grow. And by doing this, we are convinced that we can continue to deliver superior returns for our customers and for our stockholders. Now before I close, I would like to use the opportunity to express my sincere gratitude to our staff, and many of you are on the webcast today. You, they make it all happen. And I realize that the announcements of today have impact. But amid all the changes, the transformation of Aegon requires, our customer service levels continue to improve and our employee engagement is strong. So stay with us or join us on Aegon's remarkable journey to become a U.S. life insurer and retirement leader. Thank you.

Good afternoon, everyone. Thank you for joining us today. I will walk you through our financial philosophy, discuss the U.S. financial assets, including the latest transaction announced today, share our financial ambitions and lastly, explain what you can expect from us during the upcoming re-domiciliation. I hope these insights will give you a clear picture of where we stand and where we're headed. And of course, I'll be available at the end for any questions you may have. Whilst there's no doubt that Aegon is going through a period of significant change, our commitment to value creation for our shareholders remains the same. We have a simple philosophy. We need to earn returns on our capital that adequately compensate us for the risks we take. This is embedded in our pricing, our management actions, our investments in new propositions and of course, in our M&A considerations. And if we cannot deploy capital at attractive risk-adjusted returns, we will return it to our shareholders. This is evidenced by the fact that our share count has fallen from 2,058 million in 2020 to 1,532 million as of today, a 25% drop, while at the same time, improving the level and quality of our capital stack over that time. With our balance sheet in a good place, we are focused on improving the level and quality of our earnings. And as you know, over recent years, we have strengthened our actuarial assumptions and invested heavily in our business capabilities. We are doing this so as to drive up the sustainability and quality of our earnings power. Today, we confirm our move to the U.S., which will introduce new requirements that we will deliver over the coming 2 to 3 years. This is a significant undertaking for us, and therefore, we will create some operational space by moving to half yearly reporting until U.S. GAAP is introduced with no more quarterly trading updates. In the meantime, we anticipate that our disclosures will be stable, centered on our IFRS earnings and balance sheet and our capital generation and free cash flow. Finally, on U.S. GAAP, we will not provide commentary on the expected impact until 2027 as we will be in the midst of its design and implementation in the coming 12 months, and therefore, we will not be in a position to provide reliable guidance until that phase is complete. Please bear that in mind also during the Q&A. The next slide will be familiar to many of you. The combination of strongly capitalized units and readily available Cash Capital at the holding is central to our capital management philosophy. This structure gives us the ability to fund growth, execute upon change and withstand stress events and market cycles. As you know, we have an operating range for Cash Capital of EUR 0.5 billion to EUR 1.5 billion and have historically wanted to be at the top end of that range due to the extensive restructuring within our business units. But we plan to bring that down to the EUR 1.0 billion mark or the midpoint by the end of 2026. And later, I will explain exactly how we do that. Our debt is at a healthy level. Given the announcement today of the U.K. strategic review, I am providing you with an allocation. Approximately EUR 0.7 billion to EUR 1.0 billion is assigned to the U.K. and approximately EUR 1.0 billion to EUR 1.3 billion is assigned to the 24% shareholding in a.s.r., with the remainder allocated to the U.S. And finally, there's no change in our philosophy on our stake in a.s.r. We continue to be a patient shareholder, and the shares provide us with a healthy cash flow to support our own dividend and interest costs. Let's now turn to the next slide. We know that risk drives our cost of capital. And historically, Aegon's cost of capital has been somewhat elevated. Over the past years, we've strengthened our processes, both in the businesses and between the businesses and the holding company. We will remain vigilant during the coming 2 to 3 years as we execute upon the move to the U.S. On market risk, our general account, which is mostly in the U.S., is diversified and is something we feel comfortable about. Compared to peers, we are overweight investment-grade corporates and treasuries and have lower allocation to structured credit. In terms of our exposures, we have a commercial mortgage lending book, which is around $11 billion in size, but is prudently set from a credit, geographic and refinancing maturity profile. This book is performing well, and we do not have significant refinancing period spikes in the coming years. Our corporate bond portfolio is $41 billion. And as mentioned, we are more heavily weighted when compared to peers to this form of unsecured credit. Within this, 97% is classified as investment grade. With respect to industry exposures, around 30% is in financials, 60% in industrials and the rest in utilities. We have some non-housing ABS with an exposure of around $7 billion, but this is senior in nature and diversified across collateral types. Finally, we have a small reliance on smaller rating agencies for our processes with 3% of assets using KBRA, DBRS and we have 0 reliance on Egan-Jones. On biometric risk, over the years, we have been updating actuarial assumptions in order to improve the quality of our balance sheet, in line with our experience. Our mortality tables have been dramatically simplified and our assumptions around mortality improvements are supported by external testing. We closely monitor our actual to expected performance, which since our major mortality update has trended well. We are equally comfortable with our assumptions around long-term care. We made the decision to remove morbidity improvements in 2023. We continue to apply mortality improvement for customers who are not in claim, and we have updated our morbidity incident rates to match recent experience. We also continue to implement actuarially justified rate increases when needed. Moving on to the next section on financial assets. I'd first like to highlight that this is a large block of business that has some market and actuarial sensitivities. However, it is mature and supported by a rigorous assumption setting process. We expect this block of business to generate positive OCG and positive IFRS operating earnings in the coming years, thereby contributing to the dividend-paying capability of Transamerica. Second, we have announced a clear and ambitious plan to take our capital employed down to $2.2 billion by the end of 2027. We have made very good progress on this, and we will continue to reduce capital employed hand-in-hand with lowering risk sensitivities. And finally, how we look at the financial lens. Well, today, we announced the transaction on our Secondary Guarantee Universal Life block, which I'll explain in more detail in a few minutes. But as we assess third-party transactions, we're looking for two things: the price compared to our valuation equity, which can be seen as our view of the economics and an overall accretion to free cash flow per share. Let us now look at the financial assets in detail on the next slide. Here, you can see a breakdown of the capital employed, statutory versus IFRS reserves and key risk exposures by segment. My main message is that the level of reserving in aggregate between our best estimate view under IFRS and our capital framework is similar, and that strengthened further after the transaction announced today, although, of course, there can be differences between the blocks. On our capital employed, where we have made good progress in reducing the level over the years, the majority remaining is concentrated in the Life block and the long-term care segment. You will note that there is relatively limited capital deployed on variable annuities, and this reflects the conservatism on the reserving. You can see that a significant portion of capital is dedicated to supporting long-term care. The capital requirements for long-term care are largely determined by the asset exposure back in these reserves. As our statutory reserves are projected to grow into the early to mid-2030s, we anticipate that the capital needed to support this segment will also rise over time, all else being equal. With the statutory reserves lower than the IFRS reserves for long-term care, something which is relevant when considering third-party transactions, but will reduce over time as we build statutory reserves, we expect minimal OCG contribution from this block of business, although continued positive IFRS earnings. The capital needed on the Life side is also driven by the asset exposure. But here, we would expect a gradual reduction as the book naturally runs off. Post the transaction announced today, the overall statutory reserves are aligned with the IFRS best estimate and earnings emergence will therefore be driven by the claims profile. The VA reserves on the statutory side are healthy, thanks in part to the reserve flooring that is in place and that you know about. And this explains why the capital need is smaller as there is a strong interaction between reserving level and capital level for variable annuities. For example, should markets correct by 10%, then the capital employed would be expected to increase by around $150 million and the reserves would fall by a similar amount. So for VA, capital and reserves need to be looked at hand-in-hand. And you are aware of the thorough hedging approach we have on the variable annuity book. This is managed by a well-established team with decades of market experience. Pro forma of the Secondary Guarantee transaction we announced today, our capital employed stands at USD 2.7 billion, and that is ahead of our 2025 target of USD 2.9 billion. Later today, Will Fuller will cover the numerous actions we have taken to reduce our exposure in financial assets over the years. So let me now walk you through this transaction. We've reinsured our Secondary Guarantee Universal Life contracts and removed 10 billion of net face value from our legacy life blocks. Consequently, we have now reinsured approximately 80% of the gross face value of our SGUL portfolio. This block, as you know, has historically been a drag on OCG for Aegon and causing volatility. And we are transacting at a small premium to our IFRS best estimate liability, meaning that we believe the price we are achieving is similar to our view of the best estimate cost, while we are also removing through the transaction, the risk of variance in that liability. You can see this on the chart with a small hit to valuation equity of USD 0.1 billion. Next, we have the impact from the difference between statutory and best estimate reserving, which when combined with the release of required capital, explains a hit of USD 0.2 billion. As mentioned, this block has significant reserve financing in place at the statutory level, common in the industry and is a reason why we have had a large negative drag on OCG. And then finally, realized losses on investment assets disposed in association with the transaction and constraints on DTA recognition also hit the capital on day 1, the latter being a timing issue. Adding up the combination of the economic price impact, the statutory to economic differences and the impact of realized losses and DTA gives an overall large EUR 700 million hit to statutory capital. To neutralize this, we will inject EUR 700 million of capital, essentially the proceeds from the sale of our a.s.r. shares a few months back. On this injection, we expect additional OCG and remittances to the group of around USD 75 million per annum. And this means that the free cash flow per share of Aegon Group will increase post the transaction, both relative to the situation we had pre the disposal of a.s.r. shares and relative to the alternative of using the EUR 700 million to buy back stock. The combination of dealing with legacy issues, improving Transamerica's balance sheet and cash flow quality and increasing the free cash flow per share of Aegon while removing tail risks for a price comparable to our best estimate makes this an attractive transaction for our shareholders. Let me now turn to the next section, where I will share our financial ambitions during the transition period. We will focus on four key metrics to drive our financial performance. These are IFRS operating results, OCG, free cash flow and dividend. Our forecasts are built upon individual business unit run rates that we have given for 2025. We have then adjusted these run rates for the impact of the SGUL transaction and aggregated them using an assumed euro to dollar FX rate of 1.20. We then apply the expected growth rates across the businesses, and these determine our group ambitions. For Transamerica, our starting point is the 2025 run rate pro forma for the SGUL derisking transaction. Starting with IFRS, in the first half of 2025, I provided you with an operating result guidance of $700 million to $800 million for the half year, which is equivalent to $1.4 billion to $1.6 billion for the full year. The operating results are expected to grow by around 5% per annum, and this is not impacted by the deal. This growth is driven by underlying growth of our strategic assets, which are forecast to grow by more than 5% per annum. And this will be shown in Will's presentation later. And this means that as the financial assets run down, the overall business growth rate is expected to increase as the financial assets have a slower rate of growth than the strategic assets. For operating capital generation, the quarterly run rate of $200 million to $240 million for 2025 is expected -- is equivalent to $800 million to $960 million for the year. Pro forma of the USD 75 million uplift from the SGUL transaction, this results in an annual run rate of $0.9 billion to $1 billion. The OCG growth rate of 0% to 3% reflects our investment in new business growth in line with the strategy to date. On remittances, the USD 675 million pro forma run rate for the SGUL deal is expected to grow at around 5% per annum, unchanged from the previous guidance at the 2023 Capital Markets Day. This reflects our desire for stable growing remittances from the business units, reflecting underlying development in capital generation and earnings power. Moving to the other businesses on the next slide. For the U.K., our operating results, OCG and remittance guidance are consistent with what we communicated at our webinar last year. Shawn will outline the strategy and financials underpinning the Asset Management business, which is expected to show steady growth, coupled with remittances growing by more than 5% per annum. And our international businesses are also expected to show steady growth, although we expect some drag on OCG from China, which also does not pay dividends given its capital position. Remittances from the international businesses are expected to be largely flat as TLB gradually reduces its dividend after distributing excess capital over the past years. Turning now to the group consolidated view. As mentioned, we have based all of our numbers -- we have rebased all of our numbers for both the SGUL deal and an assumed euro-dollar FX rate of 1.20. In this context, we expect our operating results to grow by around 5% per annum, OCG to grow by around 0% to 5% and free cash flow to grow by around 5%. And this means a growth in dividend per share of more than 5% per annum. Moving to the next slide. I would like to confirm that we are on track to deliver our Cash Capital holding target of EUR 1 billion by the end of 2026. To support this, we have today announced an intended EUR 400 million share buyback for 2026, of which EUR 200 million will be completed by the end of the first half. Now Slide 34. I would like now to move to the last section of my presentation on the implications of our relocation to the U.S. This is a major -- the relocation is a major piece of work for Aegon and it's something we will navigate with prudence. We anticipate onetime implementation costs of around EUR 350 million, driven by the U.S. GAAP implementation and restructuring of our head office in the Netherlands and building up a head office in the U.S. U.S. GAAP implementation constitutes around 40% of the onetime cost and around 60% of the total cost will be booked in the holding, and it should be factored into your Cash Capital projections. Post the relocation, we expect overall cost neutrality on a run rate basis. And this is because we anticipate some cost and tax synergies, but also expect some higher costs from the generally higher cost environment present in the U.S. On taxes, we do not anticipate any material tax liabilities emerging from the relocation. And on our debt, no refinancing is required because of this move, and we will continue to assess these on an economic basis. That means, put simply, we will compare the cost of our debt versus what we can achieve in the market if we were to issue new securities. And there could be some different tax treatment on certain instruments, which may factor into this economic assessment in the medium term. On regulatory oversight, this will likely shift to the Iowa Insurance Division. And under U.S. group supervision, we do not expect a public group solvency ratio or regulatory intervention level. And that brings me to my concluding slide. With the SGUL transaction announced today, we have strengthened our balance sheet, improved our risk profile and created a cash accretive position for our shareholders. Our financial ambitions for 2026 and 2027 are clear, and we aim to grow our operating run rate by around 5% per annum, grow OCG run rate by 0% to 5% per annum, grow free cash flow run rate by around 5% per annum and finally, increase our dividend per share by more than 5% per annum. And with this, I will hand back to Yves for the Q&A.

All right. Thank you, Duncan. So before we start the Q&A session, just a few rules. The Q&A is for the people in the room only. Obviously, people online can listen in. I'm going to ask Lard and Duncan to join here at the table. I'll be moderating the session. [Operator Instructions] So we can start with Cor.

Good Afternoon, I’m Cor Kluis, ABN AMRO, ODDO. Thanks for the presentation and an intensive morning with so much information. A couple of questions. Maybe first question is about the Cash at Holding. You now are targeting mid-end of the range by the end of next year. However, the company is changing a lot. You reduced the risk a lot by injecting and doing the transaction in the U.S. and also the move to the U.S., where the U.S. will be the key base. Might it be possible that at a certain moment, you go lower than the EUR 1 billion targeted range? And what is required to go to a more normal level, given the interest and all the cost, it's quite good coverage ratio if you would have EUR 1 billion there. So that's the first question. Then the second question about the U.K., the decision to revise the options, including a potential sale. How far are you? How do we have to -- no, how did you come to the conclusion? And when might -- if a sale, which you put on your own slides would happen, what's the timing of that? Is it mid next year or '27 kind of moment for that? And the last question is about the growth, the growth in the U.S., of course, if you look to the top line, you talk about 10% growth, 15% growth for protection. Well, if we look to the OCG, it's more 0% to 5%, dividends 5%. Can you give that bridge? That has to do with new production probably, the Financial Assets, but could you help us a little bit to show that bridge? That's my -- that were my questions.

All right. Thank you, Cor. So I suggest Duncan takes the first question on the Cash Capital at Holding. U.K. strategic review is probably from Lard. And growth in the U.S., can start with Lard and Duncan can add after that.

So first, the U.K. I want to make one thing clear first. When I talk -- when we launched the review of the U.K., this is about the adviser platform business about the workplace business and the Insurance business. This is not the Asset Management activities in the U.K. So again, the Asset Management activities in the U.K. are not part of the strategic review. That's number one. Number two, the reason why we took the decision to have this review is that we said moving to the U.S. and being very clear in our ambition. I mean, we're very clear on our ambition. We want to move our head office and the entire company to U.S., renamed the company Transamerica. Why? Because we believe the U.S. market has a huge amount of opportunity. We want to lean into that reality. We want to support Will Fuller and his team optimally in growing this business profitably, and that's going to require a lot of our focus, including the move itself and making sure that, that is done in a good way. So then we reflect and then said, okay, if you look at the U.K. business in the scope that I just mentioned to you, they have announced their plans at their Teach-In in 2024. It's a big transformational effort. So why don't we use this moment to say, take a step back and ask ourselves, how can we find ways to accelerate or to maximize the value of the U.K. business? And given the additional focus we're going to have on the U.S., is this not the right moment to take a step back and have all options on the table, including a potential divestment and enter into that review. We decided to do that. The review is launched today. So from now on, that review will start to take place, and we expect that review to be concluded in the first half of 2026.

Okay. On the Cash Capital. So in my speech, I mentioned that the purpose of the Cash Capital is to cover potential market stress events, allow us to manage through cycles and to take advantage of any opportunities. And historically, we've wanted to be at the top end of the EUR 0.5 billion to EUR 1.5 billion range because we're going through quite a lot of change. And we brought it back down to the EUR 1 billion as we've executed upon quite a lot of restructuring. The next couple of years, we're also going to go through quite a bit of restructuring. So I think it's likely it will remain around the midpoint for the next restructuring phase. But thereafter, there may be potential to bring it back down -- bring it down further towards the bottom end. The second question was -- how do you reconcile it? Okay. So how I think about it is the earnings power of our businesses are going to take the U.S. as an example, will grow by around 5%. Within that, as you noted, the strategic assets are growing quite a bit faster. around the 10% sort of range. And the financial assets are shrinking. And that's how you get to the 5% in terms of earnings power -- underlying earnings power. Over time, because the strategic assets will become larger and the financial assets become smaller, that means that, that 5% sort of earnings power for the business should increase mathematically. As we move from earnings power to OCG, there's one major difference, which is the treatment of new business. And in the near term, because we're going to continue to grow our sales, both in the Life business plus in some of the new products we launched since the 2023 Capital Markets Day, such as RILA and we have a technical -- a slight technical topic, which is lower aggregation benefit than we've had in recent years. That means that the underlying earnings power of around 5% is going to come down to between 0 and 3% on a capital basis. And our targets are only for the next 2 years. So it's really a short-term guidance. Over time, that should converge, obviously. And then the remittances, we were trying to keep a bit more stable, and we weigh up earnings power plus capital generation. We feel confident we can keep at around 5% growth for the remittances.

Alright. Michael?

Free cash flow per share, sleeping beauty and the -- maybe a little bit more insight into the risk implication of the EUR 10 billion deal. Sleeping beauty, so you're giving up not me, but Cor, and all these other guys really clever questions. Your financial discipline, I'm sorry to say, will drop. It's a fact. You will not have market questions for 2 quarters of the year. And I don't understand why you would take that risk. I see that as a risk when effectively for now, you're getting it for free. So that's my criticism today is you're effectively letting go of two reporting periods a year where you really do get a free ride from us guys. The second guy, and you might not think that, but I know that consultants charge a lot for what we do. The second is on free cash flow per share. Can you say when I had my call with your wonderful team this morning, the starting point remained the same, EUR 0.8 billion. So I can't see how free cash flow per share is increasing and you might say, well, that's the technicality of the exchange rate, but the figure itself hasn't changed. So I'm just struggling to reconcile that. And the last point, could you go through in detail the derisking benefit of a transaction?

Okay. Should I take -- I'll take all three. No, Michael, I share your -- it's not an easy decision to give up quarterly trading updates. We need to do it for the next 2 years because I do agree with you, it's a good discipline, and we debated this heavily internally. But the reality is the amount of work we need to do to execute upon a new accounting system in a space of only 2 years and restructure a corporate center in the Netherlands and build up a new one in the U.S. is significant. And the reality is that's heavily weighing on the finance community within Aegon, and I need to create some space. So the lesser of the 2 evils is to prioritize the execution, which must be done, whilst also delivering our normal must-do audited numbers and unfortunately, give up spending more time with you, which is not an easy thing to do, Michael. Then on your next question was a free cash flow. So what we were referring to there is the transaction. So -- and that the mental models, this is not the only lens we looked at the transaction, right? So we -- the primary lens we looked at was, is the price we're paying for the SGUL reinsurance consistent with our view of the economics. Hence -- and that was the 0.1 at the top, and we felt that was in the range of consistent. Then depending on the type of blocks, and this is a block which had -- for the industry has had a particularly bad history on both mortality and for the industry and ourselves, by the way; mortality, policyholder behavior and is also heavily financed, heavily reserve financed. In this particular block, there's quite a large gap between the reserves we needed to hold under a capital basis and our economic view, and that explains part of the hit. And then what we did was we said, well, if we need to inject capital, what do we get back for it? And we compared the return we were getting on that capital injection with our alternatives, which if you go back 6 months, would have been keeping hold of a.s.r. or alternatively monetizing a.s.r., reducing our share count, but not getting the free cash flow uplift. And when we weighed all that up, also in the strategic context of the announcement today, plus also a desire overall to strengthen and continue to improve the quality of earnings power coming out of Transamerica, we felt this was in the best interest of our shareholders. Coming back to the derisking. As I mentioned, this has been a problematic block in the past. Broadly speaking, what are we removing? We are removing mortality variance and mortality exposure. And secondly, we're removing policyholder behavior and policyholder variance. We're fully removing those things. And at the same time, we are unwinding two captive structures associated with a XXX reserving, which is all of the captives we have on our Secondary Guarantee Universal Life. Okay. So in terms of sensitivity, roughly a 5% mortality shock. If you look at our IFRS disclosures, which I think is the best way of looking at this, the 5% mortality shock will reduce by around $40 million and is in the analyst presentation and similar sort of gearing for policyholder behavior.

All right. Farooq.

I've got questions around the financial assets. So when I look at Slide 28, you're mixing kind of an IFRS effect and a statutory effect. So that's the slide where you're showing the injection of the $800 million versus the impact. So the statutory impact is kind of $600 million, you're injecting $800 million. I mean you're quite materially improving the capital position within the U.S. So I'm just kind of wondering why you couldn't have done a little bit of both, right? So you could -- if you stuck in $600 million to cover the statutory impact, you still would have created additional capital ratio and would have thrown the market a little bit of a toy in the shape of a buyback. So I'm kind of wondering why you did that. That's kind of question one. Question two is when you look at your USD 2.7 billion of capital employed and the USD 2.2 billion, how much left -- how much organic effect is there that's left? I'm guessing not a lot. And if we take potentially external or third-party transactions that you could do that might be on the table, given what's left and what you've done, is the capital required versus the capital reduction ratio similar? Like right now, you're sort of using double the amount of hit to capital to get a EUR 300 million [reduction]. So it's like a 2:1, slightly higher than 2:1. So should we sort of pencil in that there's going to be quite a significant need for more injection into the U.S. to get to that EUR 2.2 billion target? And then finally, sorry for these very horrible complex questions, but you did throw a press release this morning. It was very complete. So I feel I'm justified [indiscernible]

It was a lot.

Yes, it was a lot. But when looking at those books that you talked about in the financial assets and the capital employed, I just want to get this right. It sounds like in VA, it's kind of small, but volatile. So long-term care, obviously, is an issue, but you need to find the right kind of buyer for that in financial terms. I was just kind of wondering what actually possibility there is. So VA doesn't sound like it would do much, but it will remove volatility. Long-term care, maybe there is a bigger impact, but it's a more tough to do transaction. So what possibly could you do?

Yes. Okay. It's almost as long as the press release. If we go through it, we don't mix up IFRS and stats. So what I was trying to do in that slide is break down this deal between the economic price. So how do we view the underlying economic price, which is at 0.1%. Then the gap between our economic view of reserves and our statutory reserves, which is 0.3%. And then the gap -- and then the impact of statutory, not technicalities, but additional statutory impacts such as we have a DTA constraint, which is a timing topic. And also when we realize losses on bonds, we need to take it under the statutory framework. So that's what I was trying to do reconciling there, not really mixing IFRS and statutory, just trying to explain a bit how much is due to economics, how much is due to reserving and how much is due to other things. On a -- if you want to break -- if you want to do like-for-like, the IFRS impacts are broadly minimal. So there's very little impact on our IFRS balance sheet and very little impact on our operating, whereas the capital impacts are large, large impact on balance sheet, large impact on earnings. Actually, in terms of the injection, we injected enough just to neutralize the RBC ratio, but with one caveat. We also -- in terms of how we structured this transaction, we've also become a minority shareholder in the structure. And that explains the gap between the total injection and the amount of capital hit we take. It's roughly EUR 100 million. So we've become a minority investor, which I can expand upon if you want. So that -- there was no strengthening of capital or anything like that, I just neutralize it plus a minority investment. In terms of moving forward from EUR 2.7 billion to EUR 2.2 billion, well, the good news is we've moved from EUR 4.1 billion to EUR 2.7 billion, and there's only EUR 500 million left, so well ahead of the plan. And we're going to continue to drive that forward. I think we'll explain later, we've done -- you'll see it, we've done a huge amount of actions actually per block of business, some of which are things we just do, some of which we need to negotiate and some of which are transactions. So when I look at the move from here to EUR 2.2 billion and thereafter, I think we have ample management actions we can take, and we can really select what makes most sense for us, again, within the framework of getting an economic price and being free cash flow per share accretive to our shareholders. If you look at those blocks, you're right, the VA is small from a capital perspective because it needs to be seen hand-in-hand with the reserves, but it's volatile. So that volatility is something we would like to continue to take. LTC, we're going to build the reserves up over time. That's why the OCG is hovering around 0. So over time, the LTC statutory reserves should converge more with IFRS. But there is a lot of actuarial and uncertainty in general within that block. So if we were to do things there, we probably have to pick where we want -- where it makes sense to do it, where there's a bit more certainty. And then on the life insurance side, we've done four transactions, and we'll continue to see what makes sense.

Nasib Ahmed from UBS. Sticking with Financial Assets. Just wanted to understand how this deal compares to what you've got left in Universal Life. So you've got EUR 700 million of locked-in capital, EUR 300 million has been reduced and you paid EUR 800 million for this, and you've said this deal is more complex than the others. So -- and then kind of related to that, OCG benefit, USD 75 million, how much of a drag is left? On my maths, I think it's another USD 75 million from the UL block as a whole. So should we think of kind of if you were to derisk that remaining USD 75 million drag, is it another USD 800 million to go? That's question number one. I guess, subpart, how would you fund it, given that you're at the EUR 1 billion by 2026, you had the a.s.r. proceeds. Is it going to be a.s.r. plus a bundled deal or something of the sort? Second sub-question, free cash flow versus OCG conversion. It seems like you're growing your OCG in the U.S. much faster than -- sorry, free cash flow is growing much faster than OCG. Is that a drag on your RBC over the next couple of years? And on international, you're paying out more than 100% of OCG. I know you said free cash flow remittances is stable, but how sustainable is that payout ratio? And then finally, on Asset Management, it's 55%, right? So it's all related to the payout ratio. It's very low. Can that payout ratio increase within the Asset Management segment?

Okay. All right. Okay. The Universal -- the SGUL deal we did today. So we've dealt now with 80% of the SGUL. And as I mentioned, the reserve -- we have no more reserve financing in place. So with this transaction, we're unwinding two captives, both based in Vermont. We have no AAA, XXX captives left in place. So the remaining SGUL we have, the remaining 20%, the statutory reserves are actually a bit higher than the economic reserves. So again, coming back to that mental model, we transacted more or less close to our economic price, which is reassuring. Then we got a hit because the cap -- the statutory reserves were quite a bit less than the economic and for the remaining block, that's not the case. And in aggregate for the whole of the Universal Life, they're very similar before the impact of releasing required capital. So we feel in a comfortable position in aggregate for the remaining Universal Life and Secondary Guarantee Universal Life blocks. How much of a drag is left? We'll have to give you some precise numbers, but it really depends, and this is what I said in the speech, it depends on the claims pattern. So within the overall aggregate reserves, which are similar to the economic level, there are certain blocks which are less well reserved and certain blocks which were better reserved. In general, we're less well reserved on older ages. So -- and they tend to die a bit earlier. That's a bit of bluntly. And so that could be why there's a drag in the nearer term on OCG. But over time, it should be okay. How will we fund things? Well, just to be clear, we're in a position where we're well ahead of our target in terms of reducing required capital. We only have EUR 500 million left to go. We're going to continue to look at options to bring that down and do that as fast as we can. But in order for us to do a transaction which requires a capital injection, if we were to do one, then it would have to do two things. It would have to be at a price which makes sense for us economically, and it would have to lead to free cash flow per share accretion. So we're going to be very disciplined because we want those two things to be met. In terms of OCG to free cash flow conversion, you're right, although it's not -- because OCG is a higher number than free cash flow, 3% on a bigger number, 5% on a smaller number. Actually, it doesn't deteriorate the RBC at all. And the payout ratio anyway is below 100% for Transamerica, partly because we have restructuring costs below the line, which are going to continue for the next couple of years. On the International segment, don't forget we have China, which is a negative OCG of around EUR 50 million per annum, which will actually increase slightly. So actually, if you do it unit per unit, and China doesn't pay a dividend, obviously. So if you do a unit per unit, we're not distributing more than the OCG. So it is sustainable. Asset Management payout, why don't we leave that for Shawn this afternoon once he's talked you through the whole plan.

Ian Pearce, BNP Paribas. The first one, sorry, just coming back to financial assets. So with the LTC guidance sounding like minimal OCG and the reduction in the [ULSGE], it sounds like the two big drags on OCG and the financial assets are basically converging towards 0 or hopefully towards 0. And in the past, you've given a sort of split between financial asset OCG and strategic asset OCG. I'm just wondering if you could talk to us a little bit about that because it sounds like the financial asset OCG should be going up quite a bit versus previous expectations. The second one is just some clarifications around transaction costs and what the actual transaction costs you see in 2027 in the OCG and in the free cash flow and how we should think about that in terms of sort of taking those out of the targets?

Okay. The -- in the Financial Assets, so I said that we expect positive OCG from Financial Assets. I think in the past, we gave EUR 100 million to EUR 200 million, probably going to remain in that sort of range in aggregate. We're going to continue to take management actions because we want to bring that capital employed down. But even post those management actions, we expect to keep the OCG in a positive state and probably in the range of EUR 100 million to EUR 200 million. Transaction costs, not entirely sure what you mean. Do you mean the overall cost of the move to the U.S.?

Yes. So, when you are saying 67% [indiscernible]

No. Below the line. Free cash flow, yes. No, no free cash flow, Cash Capital, yes.

[indiscernible]

That also below the line. Yes. So everything is going to be restructuring below the line onetime costs. But it does impact, obviously, Capital and it does impact overall Cash.

It's multiple years?

And spread over 3 years. So roughly 1 to 2 percentage points drag on the RBC in the U.S., for example, per annum.

[indiscernible] from MN, Asset Manager for several pension funds in the Netherlands. I realize for the setting of today, my questions may be a bit unusual, but they relate to nonfinancial factors, but it is something we take into account in -- as part of the assessment of the relocation. I have two questions. What future do you foresee for Aegon's current ESG policy? You have, of course, broadened the, well, quite fragmented or local approach to a more overarching approach. So I was wondering if you attempt to keep that or maintain that policy. And the second question is on the protection of minority shareholder rights in the new situation does, so in Delaware. Is there anything you can share on that as well?

So on the -- thank you very much for the question. On the last point, we're going to enter now into a process where we will obviously need to present an entire package to our stockholders for approval in the EGM that we're going to convene in the second half of next year, the fourth quarter to be exactly the next year, where we will include all the governance implications in the -- we're moving to a new legal system. We're moving to a new market with a legal seat. That will mean that we need to make adjustments to our Articles of Association, et cetera, et cetera, to comply with the local regulation, also the local environment there. We will present that at that point in time, so I cannot really, at this point in time, comment on that. The first question you had about ESG, a couple of points there. We have recently on the 30th of -- I thought it's 30th of December, we have put up new targets on our website. You can see them there. And we will continue to report on those. And I want to remind everybody in the room that as long as we have securities listed at the Euronext Stock Exchange, be it equities or be it bonds, listed securities, we will report under the CSRD framework, the progress that we are making towards the targets that we have. When it comes to our identity and the way we operate and the way we roll, if you will, it's very much ingrained in our DNA that we believe that the company needs to continue to take good care of the communities that it serves and is a very good stewards of the resources that are entrusted to us. And we find that very important, including a healthy workplace, including diverse teams that perform well and including an environment where people feel valued and can thrive. So that will not change, and we'll continue to report on the progress that we're making as per the disclosures that we do and continue to report on the CSRD guidelines on that.

Hadley Cohen, Morgan Stanley. Most of my questions have already been asked, but I still have a couple. So firstly, I guess, for you, Lard, I understand why the U.K. -- you're putting the U.K. business under strategic review and what have you -- can you talk about -- I mean, were the other international businesses under consideration at all to put under review? I guess if I look at a lot of your U.S. peers and focusing on the U.S. and what have you -- they've deemphasized a lot of their non-U.S. operations over the last few years. So how we should think about the scope for that in that context, I guess, particularly within your European businesses? And then second question, I guess, more for Duncan around, I think within the USD 1.4 billion to USD 1.6 billion guidance for the operating profit for the U.S. this year, around USD 900 million to USD 1.2 billion of that is from strategic assets, which I think delivered around about USD 600 million. So if I were -- in the first half of the year, so if I were to annualize that, we're sort of at the upper end of the range. Is there anything that we should be aware of or thinking about that would suggest that you're not at the upper end of that range for the strategic assets component?

So let me first talk about the international businesses. So we -- the international businesses are all joint venture partnerships. We all have local, strong partners in the local markets, which we co-own the business. That's number one. The businesses are doing well. You saw the chart on the way the operating result increases on the remittances, okay, not China, but the remittance patterns, et cetera. And they continue to grow profitably at a good clip. I mean, most companies are 9% growth for Spain and Portugal over the last couple of years, CAGR; 9% growth on CAGR, on China; a 26% growth CAGR on the Brazilian business to give you an example. So these are profitably growing businesses, which we co-own with local partners. We're happy with them. And we will support to continue their growth because they create value. And we believe that is a good thing for us, and we're happy holders of it. And then, Duncan, I think…

Yes. On the operating results. So I don't want to get into too much guidance in the very near term. I'll just repeat what I said previously, which is on the strategic assets, in particular, if you go on the distribution side, we've been investing in WFG, and we're going to continue to invest in WFG. So the margin has been a bit lower than historically. On the savings and investment side, it's a pretty simple business, driven by AuA growth, we've had good momentum. And on the Protection Solutions, which is why -- really why we have a range under IFRS, you can obviously get variances [Technical Difficulty] which can be in any 1 quarter depending on who exactly dies when they die, et cetera, et cetera. But apart from that, [Technical Difficulty] pretty consistent with what we said in the past.

Hadley, you'll have the chance to discuss that with Will in the second part of the session.

Jason Kalamboussis at ING. A quick follow-up on Spain, for example, to understand. I mean, is it something that you -- for the moment, the operations that you want to keep and that is over the next 2-year plan. So that's something that you can review there? Or do you find that there is a longer-term aspects in there? And do you find that there is also a risk that some of your partners at some stage say, look, we know that eventually you want to sell. That's the price we're giving. And essentially, you see a slowdown. So you have had, as you highlighted, very good growth over the last 2 years. But do you see that continuing at full speed? Or do you find that there is anything at play that could come and lower that growth? The second thing is on your a.s.r. stake, could you tell us what are your thoughts when you move to the U.S. if the dividend is going to be taxed? And the third quick question, just in case, I mean, you are showing that you have about 40% of European investors. Do you presumably have looked at your U.S. peers? I mean, how much in the U.S. peers, how many European investors do you have? And do you find that the transition there, some of it will be soaked up. You mentioned, I think, from indexes. But how do you see that evolution basically over the next 2, 3 years?

Lard, do you want to start?

Yes. On the a.s.r., I want Duncan to answer that. I'm still on the Board of a.s.r. As you know, I will step down as soon as a new Aegon nominee is being appointed there. But I want Duncan to -- if you don't mind, Duncan, to comment on that. When it comes to Spain, let me start there, not only Spain, but also the other companies. Again, we're happy with these businesses. And you know what, our partners are happy with these businesses. So we are working in close collaboration with these partners to continue their progression, their profitable growth progression, and they become more valuable over time as a result. So I have nothing other to add than we're happy holders of it, and we keep collaborating very closely with our partners. Then Duncan?

There's going to be -- there could be tax implications for the a.s.r. shareholding. There's going to be, I think, a host of tax items we have to work our way through. Main point is that net-net, we don't anticipate an overall impact on our tax liabilities or run rate tax costs. We think there's lots of ways we can manage things going forward, but this is something we'll have to work through. The other point I'll make is that when we came back to the a.s.r. considerations, I said that the considerations are price to intrinsic value and alternative uses of capital. I didn't mention tax. So I doubt tax will be a driver of our behavior around a.s.r.

Then on your final question, and maybe you want to add to my -- I will start, Duncan, maybe you want to add to that. So the way how I see this will work as we relocate to the U.S., we will continue our listing at the two exchanges. We -- therefore, there's currently Amsterdam Euronext is where most of the volume is being traded. What we expect is that as we move our legal seat to the U.S., we will have a lot of -- the coverage will likely switch to analysts in the U.S. There will be much more coverage from the sell-side in the U.S. That's number one. Number two, we will -- of course, we are already doing a lot of road showing and a lot of investor coverage. The IR team does that, Duncan and I do that very regularly, and we will continue to do so. But as the entire company moves to the U.S., as we will assume the name Transamerica Inc., as we will focus very much on the growth of our U.S. franchise as the coverage will shift at a certain point, as we will have much more opportunity and many more debates and dialogues with investors. My expectation is that over time, you will see a shift in the stockholder base for that reason, and you'll also likely see a shift in the volumes and where they are being traded. And then over time, we expect that the so-called primary listing, which is often assigned locally to where the volume is highest, will likely be in New York over time. But that will be a gradual process. And we keep the two listing destinations as they are. So shareholders can continue to trade at both locations. And anything else to add, Duncan?

No.

Farquhar, Autonomous Research. Three questions, if I may. Firstly, on kind of building a bigger kind of broader, more profitable business in the U.S. I just wondered if you think organically, that's where you want it to be at the moment? Or what might there be a need for kind of inorganic options around that? And maybe more at the group. Obviously, I'll ask the same question later to Will directly. But maybe also at the group level, in terms of you mentioned kind of prioritizing financial flexibility towards the U.S. Could you maybe give us a sense of what that's going to mean in practical terms, particularly when it comes to selling the a.s.r. stakes if you do more from here? Secondly, maybe a detailed question, just on the debt allocations you've allocated to the U.K. et cetera. Could you just maybe give us a bit of a sense of the methodology behind that? And then finally, on Aegon Vereniging in terms of transposed, can that be transposed with the existing kind of share classes and options to an SEC listing? I just wonder what the practicalities of that might be and also the mechanics around the proposals and considerations that will come with regards to that at the EGM in due course.

So we wanted to give you the debt allocation because of the announcement around the strategic review, obviously. And how we looked at that is we look -- we compared earnings power and equity, so both balance sheet and earnings. And what you'll notice is that the allocation of debt relative to equity or valuation equity is broadly comparable. There's slightly more debt allocated to the U.K. on an earnings basis, but on an equity basis, it's broadly comparable. And we didn't allocate debt to Asset Management or the joint ventures. Asset Management businesses don't carry much debt and the joint ventures aren't 100% owned. So we didn't do that.

Okay. So on the two other questions, let me start with M&A. First, the point that we made about financial flexibility will be prioritized to the U.S. That is just meant to say that -- and that's what we hope comes across in the press release that our focus and ambition is really on the U.S. and extracting the value of the massive opportunities that we see in front of us through the organic path that we have. And Will Fuller will take you post the break through an assessment and his plans for the coming years, and we aim to support that. We aim to support that. And the financial flexibility comment that we made is to make sure that everybody understands that our priority for using financial flexibility is in the U.S. given our ambition that we have in the U.S. So that's the way to read it. When it comes to M&A, our path is always -- and that does not change. We are always focused on our organic growth opportunities. We believe, and Will will discuss that after the break, that we have a franchise that has returned to growth, has unique capabilities and access points to large underserved parts of the U.S. marketplace. And we believe that the dynamics are in our favor and that we have winning capabilities and that we can continue to capture a lot of opportunity and a lot of growth organically. Now -- as always, if we are -- there is an inorganic opportunity in front of us to accelerate our strategy and to do something that makes financial sense, we act. If we don't, we don't. M&A is just part of the toolkit that we have. And we're going to be very disciplined like you are used from us. We're going to be disciplined. Our posture to rational decision-making will not change. So our focus and our conviction is that over time, on the organic path, we will get there and on M&A opportunities as they arise on a case-by-case, case basis, assessed against very strict financial and nonfinancial criteria. And then your last point about the Association Aegon, the Association Aegon is a stockholder. I cannot speak for them and they have -- but they have said that they find the announcement that we make today a positive and important move for Aegon and that they will constructively evaluate any proposals that are forthcoming with respect to the governance and the setup and everything else ahead of the EGM that we're going to have in the fourth quarter of the year. Those discussions will, of course, after the decision that we just took, are going to take place in the preparations to the EGM, and I cannot speak for the discussions that we have around [Technical Difficulty] at this point.

Maybe a follow-up on the comment and on the inorganic opportunities, right? So how we should kind of like think about the targeted kind of the return on investment, right? If there is a deployment of this capital inorganically, if I see some of the press release or some of the latest acquisitions done by U.S. players like Voya, shall I be targeting kind of like a similar rate of return?

We -- do you want to talk returns on M&A?

Yes. I don't know exactly what Voya have targeted, but we will look at the returns we can get on any deployment of capital relative to the risks around that and the certainty we have in delivering upon those returns. So in the SGUL transaction we did today, we've accepted a relatively lower return, I would say, high single digit, 10% sort of mark. Because we are relatively certain about the outcome because we know it's a reinsurance deal and we know what's going to happen on the back of it. If we do M&A with uncertainty and more risk, we need a higher return and vice versa. So it's really case by case depending on what exactly the proposition is and our certainty around delivering upon the execution.

And if I may push a little bit on that one. Is this kind of like will you see this kind of like uncertainty premium around 5, 10...

It depends how uncertain it is. So it is very uncertain, and it will be meaningful, if it's less uncertain, less meaningful. So it really is a case by case.

Ian Lapey from Gabelli Funds. Just a question about Long-Term care, where I'm on Slide 27, statutory reserves lower than IFRS. If you did a reinsurance similar to one you announced today, would it be similar in magnitude in terms of how much you'd have to inject? So you reduced capital employed by EUR 0.3 billion for Universal Life and you're injecting EUR 800 million. Would it be anything like that for Long-Term care?

The way I would answer that is Long-Term care is where we probably have the biggest negative gap between our capital reserving basis and our IFRS reserving basis. So indeed, that's probably the most painful from a capital perspective. It's probably also whether you have the most variance around the economic price because there's quite a lot of uncertainty in the prediction around Long-Term care compared to the other blocks. So more uncertainty about the economic price, more of a gap between capital and IFRS. So I think, indeed, if we were to do the whole block, not sure if that's possible. But if it were possible, that's probably where you get the biggest variance. Note that we have a pretty successful organic strategy there. So we're building up our statutory reserves every year, been very successful in mitigating changes in the size of the liability with rate increases when they're actuarially justified. And we've been pretty good in managing the claims, claims handling, claims experience. And overall, we're comfortable with our best estimate. But indeed, that's the block where there's the most potential capital variance.

All right. Michael, you can ask your second question.

So one question. It's a fun one. It was the picture. It's not this picture. It's the one about San Francisco. Do you actually own the tower?

No.

Why do you show the picture then?

Well, first of all, the Transamerica Pyramid is an integral part of the -- we don't see it here actually, but it's the integral part of the logo of Transamerica and part of the brand logo. And when we did the transaction to divest the pyramid, we negotiated for 99 years that the pyramid will be called the Transamerica Pyramid and that we would continue to use it in our logo. And we also have access to the top floor for events and the like. So these were the kind of perks that we organized at the time that we divested this piece, not from our real estate portfolio.

And then that's fun, but it's helpful. And then the other question, so...

It's well known by the way, as the Transamerica Pyramid. So we're quite happy that for the next 99 years, it's the iconic building in San Francisco, the skyline defining building, and that is called Transamerica. It's good marketing and we still have it for 99 years.

It makes sense, yes. The other question is, so 2020 to '22, I mean, the first plan, you beat all targets, but massively. So dividend. I mean, it was huge. Here, you're actually kind of in line. I mean, you're beating them a little bit, but you're not beating them much. So my assumption, and it may be wrong, but here's the question is, you've invested massively in the second period in order to derisk deleverage, not yes, deleverage, but particularly derisk and lots of little actions little, but from point of view of this deal now. I just wonder whether you can give us a number of how much you've invested in that period of 3 years. It's really to kind of I tell you what it says it. Then I can say, oh, this is what they target. But look, last time, if they hadn't done this, they would have achieved so much more.

Yes. So let me -- I'll defer to Duncan later if he wants to add to this. So let me tell you the following. So we're presenting plans today with financial ambitions, right? And we've also looked at the past 5 years, and we have demonstrated how we operate. We are people who operate at scale, and we operate at pace. Don't forget that. We're financially disciplined. We have made very difficult decisions because they were rationally the right thing to do. And if you look at the future, the coming years ahead of us, look at -- first of all, you'll see plans today from Will after the break and from Shawn and how the group believes that organically, it can grow and operate and do a lot of good stuff to create value with a dividend per share growth of higher than 5%. But then we have the move to the U.S. We have the review in the U.K. So I mean, we act continuously with a rational mind and we act continuously with a lot of financial discipline, and we act, I would argue, at a reasonable pace. So that is -- that attitude that we have of building better businesses, creating value, being on top of it every day and see what we can improve and do better, how we can make more money, more value, that's the same team.

What I'll do is we'll get you -- where have we invested. We've invested massively in operational capabilities. Hugely, we'll get you that number. I don't know off the top of my head, but there's been significant operational investment. We invested heavily in our balance sheet. So a series of actuarial strengthening. And we've also invested in significant management action on financial assets, I think, over $1 billion. But we'll get you the full split off-line.

Now let's not forget, we just announced a EUR 400 million buyback program for 2026.

Do we have a final question before we break? No. So thank you very much for your questions. Thank you very much for your answers. So we're going to break for 10 minutes before the second part of the afternoon. So it's 14:42 on the screen. So at, let's say, 14:55, we can restart. [Break]

All right. Welcome back, everybody. So we are now going to start the second part of our afternoon with Will Fuller, CEO of Transamerica and Shawn Johnson CEO of Aegon Asset Management presenting. And like for the first session, we'll have a Q&A session afterwards. So Will, over to you. Thank you.

Thank you, Yves. Good afternoon, everybody. Thank you so much for being here. Thank you so much for tuning in on the webcast. We want Transamerica to be a leading life and retirement company in our chosen markets where we have a right to win. It is a targeted strategy. And the markets that we view to be most attractive are the markets serving middle to mass affluent customers, which we affectionately refer to as Main Street in America. We have unique advantages to win in this market because we have unique access through our franchises in WFG in retirement. Now I'll cover a few areas today. First, I'll recap our strategic and our financial ambition. I'll touch on our performance and targets that we announced at the 2023 Capital Markets Day in this very room a couple of years ago. I'll go into a bit more detail on the financial guidance for '26 and '27. I'll touch at a high level on our SGUL transaction. And lastly, I'll share with you a peak. A view and a few other areas that are under development that we believe can bring uplift for value in the future. And the goal here is to give you a clear perspective on Transamerica where we are, where we're headed, okay? Let's start with where we were 5 years ago. Transamerica has a great franchise, a strong heritage and iconic brand, but it was an underperforming company. At the 2020 Capital Markets Day, we set to restore performance. We set to restore performance by focusing on higher return strategic assets where we wanted to grow, while reducing lower return financial assets. We set targets, we met them. We reconvened that the 2023 Capital Markets Day to offer a view of Transamerica's equity story on a go-forward basis. And we shared that we wanted to build a leading middle market life and retirement company. Strategically, we committed to building industry-leading businesses in the 3 chosen markets where we had unique advantages in our distribution franchise and our life insurance franchise and in our retirement franchise. And those were built off of WFG in distribution and access to retail customers and retirement record keeping, which is the price to admission to originate retirement savings in the workplace where most Americans save for retirement. That was the strategic set. The financial set is that through that strategy, we would allocate capital to strategic asset business lines and along with an ongoing reduction in capital employed to financial asset business lines, we would go about improving the balance sheet. And in combined, that would improve the quantum and quality of our capital generation along the way. And at the time, we set ambitious financial targets. And operational KPIs. So where are we now? We've made considerable progress strategically and financially. We've invested to strengthen our access points to customers in the middle market, you see that in WFG, you see that in retirement. But we've also built out and expanded our third-party distribution in insurance, banks and broker-dealers, so we can reach more advisers and more customers. We've been able to do that because we've rebuilt our operations and our services that were previously outsourced fully to a third party. From that, commercial results have materially improved across the board, across the board. And you see those commercial results, the planting of seeds of capital today to build earnings for the future tomorrow. You see that fueling the ramp-up in our strategic asset earnings. At the same time, we've lowered our risk profile. We've strengthened the balance sheet, and we've reduced the capital asset, capital deployed ahead of target. Expenses have been in control. While we've made these changes, while we've made these investments, which will provide us the benefit of operating leverage as we grow. And the quantum and quality of capital generation has improved as a result. I'd point to our OCG results, and I'd point to our CSM, our contract service margin, which is a measure of future profits. And today, our CSM is comprised of more strategic assets than financial assets, and that will continue to grow. So indeed, measure by measure, progress by progress, Transamerica is indeed growing again, and the driver of that growth is strategic assets. And you see that in the financial profile. We are becoming a strategic asset profile company, 2/3 of our capital, 90% of our operating results. And if you look at our underlying source of earnings, you see them balanced. And what I'll point to importantly, because it was a key aspect of strategy was the noninsurance result element of our earnings sources are now 34%. That is the earnings sources that is comprised of the distribution results from WFG and Retirement. So stepping back, it's a higher quality profile, it's more predictable profile and again reinforces that we are becoming, and we are building a strategic asset company. We build earnings by being disciplined and focused on attractive markets where we can write profitable new business. We pick our spots. You'll hear a lot about how big the U.S. market is, how massive it is. Indeed, it is. But that means there's a lot of segments. There's a lot of segments, products, customer origination sources, it is important to pick your spots, be disciplined and target where you have a right to win and where you compete on your own terms. And that is what we do. This slide shows that we are tracking to most Capital Markets Day targets and in some cases outpacing the industry. Now I'll start with WFG, our agent and our annuity sales are growing double digits faster than industry, while our life insurance has been quite similar growth rates to industry. As we've gone about restoring our operations and service, which we announced to you at the 2023 Capital Markets Day, and we've completed in the first quarter of this year, as we restore those operations and services and improve the quality of them, we saw the Transamerica share of WFG sales steadily increase. Starting in the low 50% market share, now in the mid 60% market share and holding firm. You see this market share improvement in WFG feed the above-industry growth rates in our life insurance sales. Now I'll take a point here to acknowledge that life sales are behind our 2025 ambition, but they are catching up. And we have strong growth rates going out to '27, which I'll show you in the past. These strong growth rates are based on our recent run rate trends. And what's behind that? New products in a new market, an annuity product that was built after our Capital Markets Day and entering the new simplified issued life market, which we've done in the past year, and I'll touch on both of these in a minute, and that's what's driving the catch-up. The strategy to grow retirement assets while increasing penetration in ancillary solutions like stable value is tracking to plan. We've restored net deposit performance to now be in line with peers. We have momentum, and we're positioned to do more. Now big picture, Transamerica benefits broadly from the attractive trends in the U.S. And Lard mentioned, I think the key ones, right? It is the largest market in the world, indeed, for life insurance and for retirement savings. And there are big trends that are favorable to product demand. The private sector provides benefits to society in the U.S. And when you have the dynamics of people living longer, baby boomers, retirement in masses, I acknowledge this year, I believe, is peak 65, which is the peak of the baby boomers turning 65 is this year, giving you a sense of where the American demographic is. The widening of protection and savings gaps and the record levels of intergenerational wealth transfer, this is a dynamic market. And when you look specifically and you zoom in to the consumer demographics and you look to the middle class in America, which is -- I would define as the middle market and the mass affluent market. You see that the need -- first of all, the size of those demographics are massive and they have a substantial need for financial planning and advice. But they are historically underserved. And they are not crowded with competition. We have a way at Transamerica to effectively economically reach and serve these customers, and we tailor our solutions to them. WFG is a unique engine to access retail customers in this market. Our retirement recordkeeping is an advantageous way of reaching customers where they work, which is where they generate primary savings for retirement. And so when I think about these markets and I think about our advantages in them, I see a very profitable space for us with a lot of future runway. Next, and Lard mentioned this, our philosophy is to have a model that is built around the benefits of compounding economics. And what do I mean by this? Is that distribution, as distribution and as retirement recordkeeping grows, it feeds the product solutions that we create and we manufacture. So for instance, as WFG volumes grow, it feeds our life insurance products, it feeds annuity products. As retirement assets grow, it feeds our ancillary solutions like stable value. And you see our strategy playing out. We have momentum. We have confidence that there's a lot of potential ahead, and I believe this is further bolstered by Aegon's decision to prioritize the focus to the U.S. Now stepping back for a minute and offering operating result guidance for the next 2 years. And Duncan mentioned this is to increase by 5% per annum. Well, underlying this are the business segments. The strategic asset business lines are growing at a rate faster around 10%, and they're partially offset with the runoff of financial assets. Now to understand this slide, I would point out that the starting point is a trailing 12-month 2025 run rate adjusted for the SGUL transaction and experience variances. So let me walk through each of the four businesses. And I'll start with WFG. 92,000 agents and growing, agents that live in the middle market communities that they serve. And then when I say that's what allows us to economically reach and serve those hard-to-reach communities is because of our wonderful agents. Our operating results are driven by sales volumes. So increasing agents and having the agents become more productive is the main focus of driving the business. The agent force is tracking to the 110,000 ambition that we have, life sales to $900 million in annual sales and annuities to $5 billion in annual sales. And you see these sales levels, and you see these growth rates, reflecting the momentum that we are delivering today. These result in double-digit revenue growth and operating results as we hold margins stable over this period. Now one area where we see more potential is in agent productivity. And ultimately, it needs to be easier for agents to do business so they can spend more time with their customers and building relationships. Small increments of productivity improvement in this distribution system yields meaningful results. WFG is not a new business for Transamerica. This is a business that we have been associated with and owned and operated for 25 years. It is a hard business to replicate at our scale. We know this market well. We have a lot of experience, and we have a lot of data with agents and agency leaders and the customers that they serve. And back to the benefit of compound economics, these volumes that you see here, feed the good results of the Protection Solutions division as WFG is the largest originator of our sales. Protection Solutions. The formula here is to predictably increase earnings from writing profitable new business. We target 12% unlevered returns and payback periods of 5 to 7 years across the life portfolio, with our flagship product IUL, being a bit higher in return and shorter in payback period. Our top line momentum has us reaching $720 million in annual sales and growing operating results around 10%. The product formula is indeed targeted to middle to mass affluent market needs. We write high policy volumes to younger policyholders, younger insureds, at face amounts that average less than $400,000. It is a protection-oriented value proposition to younger American families. And in this way, we get the benefit of a law of large numbers approach. And we also get the benefit of a higher quality, predictable earnings profile that's rational, it's disciplined. And again, we know this market well, because we've been writing to this customer profile and risk profile for quite some time. We're a top 5 IUL writer. We're a top 10 overall life write growing at a rate faster than peers. Now why is that? Well, I've already talked about the strength and the advantage of WFG generating consistently reliable sales volumes, but we've also been able to -- after rebuilding our operations and service started to extend into other markets that have the same sort of risk customer profile, return profile that we like. An example of that is the entry into the simplified issue life insurance market, which is adding growth to sales, and we expect that to continue. Let me step back and explain to you a bit what that is. The simplified life market is a streamlined customer experience. It's a technology-led, digital underwriting experience, compared to the more traditional fully underwritten insurance model. Customers answer a short questionnaire about their health history, while carriers assess risk from data sources. We draw down information about prescription -- prescriptions that an insured might have. And from those responses and those data sources, we make an underwriting decision. From the customer standpoint, this results in a much more streamlined process compared to legacy underwriting and we price to reflect a simplified underwriting process. The market is very large. It's a $1.5 billion annual premium market, and it's growing quite nicely. We started with final expense, which is a small policy face amount level. We just expanded to our index universal life, which is our flagship product in the last quarter, and we'll be adding term next year. This expansion is a logical extension and add-on annuity category again, because of the customer risk and return profile being very similar. It is a solution that's sourced from the middle and mass flow market that we know well. We have 6% market share today, and we see a good runway to improve that. Let me underscore that this market and our success in it would have never been possible when I sat before you 2.5 years ago. But we've rebuilt our operations, our service, our product manufacturing and added a technology partner. And it was each of those pieces that open the door for us to expand and extend how we are reaching and serving customers. For retirement plans, I think the formula here is actually very simple. We grow record-keeping assets and we increased penetration in ancillary solutions that bring with it higher margins, like stable value and IRAs. And you see that really just come off the page here. It's this combination of these 2 that have led to the ROA expansion that you see here. And this ROA expansion will continue to play out, as you see, going from 6 basis points to 8 to 11. Recordkeeping is, as I said earlier, the price to admission to access the U.S. workplace where retirement savings are generated. And as our record keeping assets grow, it feeds our ancillary solutions, and that generates the margin uplift. At the last CMD, I shared with you that our financial strategy was for every $1 of record-keeping revenues, we would generate $1 in ancillary solutions. Today, we are earning -- roughly $1.10 in ancillary solutions for every dollar in recordkeeping. We have good positions in all plan sizes and types. We are uniquely positioned in the pooled plan space, which is where small and medium-sized companies collaborate together. We are considered the leader in that space. We have many large and successful distribution partners in that space that contribute to asset growth. And looking forward, I view operating leverage here to also be a contributor to profitability. So when I look at the ROA results of going to 11 basis points in 2027, we see a clear path. And ultimately, in this business, we expect to reach mid-double digits over time. Now stepping back on financial assets, this is a mature closed block comprised of universal life, annuities and Long Term Care as we cover today. These contribute positive operating results in OCG, but they decline as these books are closed and they're in run-off. And the strategy is to bring capital down -- capital employed down to $2.2 billion ultimately by 2027, while reducing the underlying risk and lowering the sensitivities. And let me reinforce, it's a balanced approach where the objective is measured on the improvement in each of these dimensions, not just capital employed. Now how we go about managing financial assets. Now we've done this from the beginning, is through an approach which we frame has a playbook of actions comprised of unilateral, bilateral or third party. Let me explain to you a bit what that is. Unilateral means these are actions that are within our control, things we can do ourselves. Bilateral are actions that require approval of either a customer or a regulator, and third party with what we would define as transactions. And there has been and should expect a regular cadence of these in-force management actions. So since we began a few years ago, we've had approximately 25 unilateral actions. Examples of that would be multiple steps in hedging the variable annuity policy experience that we're known to be quite effective and has performed quite effectively, establishing voluntary reserves and updating and strengthening assumptions. We've had approximately 25 bilateral actions, such as Long Term Care actually justified premium rate increases, variable annuity buybacks and a purchasing program for institutionally owned universal life policies. And on third-party transactions, we've executed several including the one that we announced today. Duncan hit on this pretty well, but the perimeter of this transaction was focused on removing an OCG drag and removing volatility in our earnings. The transaction price was consistent with our view of the value, consistent with our best estimate assumptions, the small impact of valuation equity reflects the price paid to reduce our risk. The risk here is typically mortality risk and policyholder behavior risk, as was mentioned. In addition, we wanted to unwind captives, and we wanted to resolve all of the reserve financing associated with SGUL. And it is that action that has removed the OCG drag and supports funding net remittance increases of $75 million per annum to the group. So post transaction, 80% of the SGUL book of financial assets has been reinsured 100% of the captive financing for SGUL has been removed. And for the 20% remaining, reserves are consistent with statutory and IFRS and the same is true now for the aggregate of financial assets. We started with capital at our last Capital Markets Day, $4.1 billion. Our target was $2.9 billion. We're now $2.7 billion. So we have $500 billion more to go to our $2.2 billion. We see a clear path just through our playbook of actions of unilateral, bilateral, third party under the parameters that Duncan outlined earlier. Now stepping back and offering guidance across our 3 core metrics. I've covered operating results in detail, but as a recap, 5% per annum, strategic asset higher, financial assets lower. So it nets out to $5 million. OCG guidance, 0% to 3% growth per annum. We're choosing to increase the investment in new business that comes with higher strain that's reflected in this guidance. And this supports the growing of our life strategy, commercial strategy, annuity strategy and our retirement stable value business. And our net remits are lifted at $75 million from today's SGUL transaction per annum and then resuming a rate of the 5% growth that we committed to at the last CMD. So now everything that I've shared with you up to this point are embedded in our current plans, and they're embedded in our guidance. But we have an ambition to do more, to contribute more. Building a leader in the U.S. is not a destination, it is a journey and it's one that we will never be complete with. We will -- it's a verb, and we are building not built. And so you -- we want, as a management team to be looking for ways in which we can improve the value, we can improve the growth trajectory in the future beyond the guidance that I've shared with you today. So the next couple of pages represent a few areas under development that help power future uplift. And I'll start with the general account. Our general account is $80 billion, and it's growing again. It's growing again because our strategic assets are powering and outrunning the runoff of financial assets. And as Duncan shared, it's well diversified, 97% investment grade, compared to peers, we have a higher allocation of corporate and treasury. We have a lower allocation of structured credit and less liquid assets. So we believe that there is an opportunity to improve risk-adjusted returns over a full cycle. And as a rule of thumb, for every 1 basis point of portfolio yield, it increases operating results by $8 million. So here again, small incremental improvements can have a meaningful uplift. So naturally, we've added asset expertise and asset capabilities. We recently appointed a new Chief Investment Officer, and we're building out talent and capabilities in our Chief Investment Office. I expect benefits and uplift from the general account to be realized incrementally and over time from disciplined investing, allocating assets to higher-yielding credit on a risk and capital adjusted basis. And we'll do this through utilizing a broader set of asset classes while being prudent and mindful of the macro credit environment. I think about this along 2 paths. The first path is new money investing. New money investing is comprised of investments we make to support the sales that we are originating and the reinvestment of maturities. And that's one path. And the second path would be through selective reposition of the in-force, our first priority is going to be focusing on the new money yields to support our investment programs. And based on our current money yields, we are estimating to be 30 to 50 basis points behind peers with a similar ALM and risk profile. We will then look to prudently expand within our in-force over time. Aegon Asset Management is our main anchor asset manager partner, and that will not change. But we will complement with select external managers. This will provide a broader and added origination sourcing that complements AAM's core capabilities. This also has the added benefit of sustaining our commercial performance and facilitating the expansion in new products, where yield is more in the competitive equation. Up until this point, we have operated in products and markets that did not require yields to be at a competitive level. As we look forward, we see that as an opportunity to expand. So building on that theme, we want to be bigger in annuities, but highly selective in the manner we do this. Since the last Capital Markets Day, we've developed a top 10 RILA position. This is a registered indexed variable annuity. We achieved more than $4 billion in account value by building out distribution in banks, and broker-dealers. So think of it as a financial adviser community as well as WFG. Adding a fixed annuity alongside RILA is a natural and logical extension. It is a solution that's in high demand by middle market and mass affluent customers, and it supports long-term protected, long-term protection and long-term savings. Our distribution channels originate a sizable portion of industry sales. Take WFG, for instance. I pointed out earlier that WFG is growing to $5 billion in total annual annuity sales. Well, a Transamerica branded product, it's reasonable to assume, would be able to attain 10% to 20% market share. That's $500 million to $1 billion of new sales priced to attractive returns. I'm signaling this as something that we have under development as an add-on extension to annuity. There's the manner and form at which we will do that, it needs to be finalized. And once it is we will share an update with you. In addition, we plan to further press our WFG advantage. Stepping back, our ambition WFG is big. We want to be a broader financial solutions provider for the middle market and mass affluent customers that we serve. And that requires developing a business model that is broader than the business model that we have today, that's built on the foundation of productive agents able to activate and engage their customers easily and fully serve their protection and their savings needs. And that's done in a way that's tangible, repeatable and sustainable strategically and from a financial performance standpoint. And with this ambition realized, we believe that WFG can meaningfully lift future earnings and valuation from where they stand today. To achieve this ambition, a critical centerpiece will be the right technology enablement and capabilities that help agents grow, scale their business and serve their customers. We intend to start adding capabilities to this end next year. We start to -- expect to do it over a multiyear phase, and we'll provide you details as they're finalized. So once again, these are 3 examples of areas under development that we believe will be additive over time to our future growth and value generation. Now in closing, I would be remiss to not briefly comment on the implications of today's announcement of the holding company's decision to become a U.S. company. Transamerica was founded 120 years ago with deep roots in U.S. financial services and is an iconic American brand. Over this transition period, over the next few years, what does not change is our focus. We are singularly focused every single day on building a stronger Transamerica and a better company for our shareholders and for our customers in the largest insurance market in the world. We have 92,000 agents. We have 7,000 employees and a leadership team that wake up every day to build a better company, providing those solutions and services to customers. That is no different today, and that will be no different tomorrow. We have talented colleagues. We have a coast-to-coast footprint. We have a great culture, thousands of hard-working people that are resilient and tough, and they believe in our company's purpose. They believe in our long-term vision, and they bring it to life every single day. And I want to personally thank them for their commitments, their resilience, their unwavering support of what we are -- what we've accomplished as a company, but more importantly, what we will accomplish in the future. That will not change. It will be bolstered, fueled and powered up by Aegon's decision to prioritize resources and focus on the U.S. We want to be the industry leader in life and retirement market, bigger, broader and more profitable in the right markets. Aegon and Transamerica fully focus on that same ambition is a powerful combination. Thank you. I believe I have the distinct pleasure of introducing Shawn Johnson, CEO of Aegon Asset Management. Thank you.

Thank you. Thanks, Will. I'm Shawn Johnson. I'm the CEO of Aegon Asset Management. Nice to meet you all. I joined just over a year ago. I joined Aegon Asset Management after I met Lard, and he explained his ambitions to have an outstanding asset management business to support his aspirations for the group. I've been in the investment business a long time, and I was convinced after meeting both Lard and Duncan that I could make a difference in leading their Asset Management business. The ability to have a positive impact on AAM is the principal reason I joined the company. I'm very familiar with running a global asset management business with offices worldwide. Since joining Aegon Asset Management, I've traveled to our global offices. I've met with many of our team members, and I've spent time learning and understanding the business. I was very impressed with the quality of the people I have found throughout the organization. Today, I'm proud to provide a strategic update on our business, our financial performance and our ambitions for the coming years. Aegon Asset Management is a global insurance-owned asset management company with significant third-party clients. For fiscal year 2025, we forecast revenues between EUR 640 million and EUR 660 million, with an operating result between EUR 190 million and EUR 200 million. Our investment approach is research-driven and conviction-led, and we span public and private fixed income, equities, real assets, multi-asset and multi-manager portfolios. We refer to our wholly owned businesses as Global Platforms, which includes approximately 1,100 team members and over 355 investment professionals. Our Global Platforms business will be the focus of today's update. Our strategic partnerships, which is AIFMC in China and LBP AM in France, are joint ventures that allow us to deliver customer-focused solutions in their areas of expertise. Due to our joint venture partners being public companies in their own right, my comments on our JVs will be limited today. Our assets under management are well diversified geographically by asset type with an emphasis on fixed income and a strong presence in Continental Europe, the United States and the United Kingdom. Collectively, our global reach provides us and our clients with key insights and opportunities for continued growth and innovation. 60% of Global Platforms' assets under management come from third-party clients. And we've seen consistently positive net flows over the last 8 quarters. Our clients are well defined. We manage much of Transamerica and Aegon U.K.'s general account, as Will just told you. We manage assets for affiliates such as Transamerica Asset Management in the United States. We also manage assets for around 450 institutional clients, including over 80 insurance companies as well as for assets managed by wholesale or retail clients. Our clients include pension funds, banks, insurers, sovereign wealth funds, wealth managers, financial advisers and investment platforms. Our ability to attract and retain third-party assets is a testament to our strong performance and trusted relationships. Relative to performance, I wanted to show you at least a few of the strategies we have in each of the areas, Continental Europe, the U.K. and the U.S., very long-term track records. Over the past 3 years, the vast majority of our strategies have outperformed their benchmarks or their peers. That's why you see 8 quarters of positive performance -- or positive collection of assets. We see flows in all of these strategies. We have flows in commercial mortgages. We have flows in equities, and we've just launched a new LTAF here in the United Kingdom. Our strong track record is a key driver of our positive net flows and our reputation in the market. We manage our Global Platforms business through 4 business units, each with strong leadership and investment capabilities. Our Global Platforms' assets under management stand at EUR 261 billion, EUR 163 billion in Europe and EUR 98 billion in the United States. We have significant expertise in alternative fixed income and private debt, leveraged finance, real estate, including agricultural loans. This 4 business unit structure allows us to be close to our clients, reacting quickly to their needs. Our alternative and nonlisted assets, which we generally define as any illiquid assets across Europe and the U.S. total EUR 98 billion and is a major engine for growth in the business. Alternative strategies we already manage for Transamerica today include private ABS, private debt and private equity as well as several real assets. We expect our alternatives business and nonlisted AUM in the U.S. to grow as Transamerica's general account grows. Since I joined the firm a year ago, we have taken clear action to strengthen our strategic position. By organizing into 4 business units, rationalizing some of our systems, simplifying the organizational structure and renegotiating vendor contracts, we have improved our operating margin from under 6% to 15.5% in the first half of 2025. We have invested in a single portfolio management system focused on our distribution activity on third-party assets, targeting investment strategies with higher revenue margins, such as CLOs, private debt and euro ABS. These actions have accelerated decision-making in the business, improved our scalability and positioned us for further growth. Looking ahead, our strategic priority in Asset Management are clear. We are expecting -- we are expanding our third-party and higher revenue margin strategies. We are improving scalability and efficiency in our business. We are growing our strategic partnerships as well. At the same time, we continue to have strong collaboration with Transamerica, resulting in mutual growth. These priorities will ensure we remain competitive and continue to deliver value to our clients and our stakeholders. I'll discuss each of these priorities in more detail. Our ambition is to grow our third-party revenue by about 6% per year, focusing on higher revenue margin strategies. This strategy emphasizes our capabilities in global high yield and an alternative in nonlisted assets. We expect this result in revenue outpacing our AUM growth over the next few years. Our diversified distribution model, we have dedicated sales teams in the U.K., in the U.S. and in Continental Europe. We also manage and originate agricultural loans for third-party insurers in the United States, further diversifying our revenue stream. Our accelerating CLO launches, both in the U.S. and in the U.K. are distributed through third-party banks, where we have excellent long-term relationships. Let's take a closer look at some of our more successful strategies. These figures just highlight a few of our capabilities. Our CLO, alternative fixed income and global high-yield strategies have all shown strong revenue growth and performance. For example, our CLO revenues are projected to grow from EUR 21 million in 2023 to EUR 34 million in 2025. We have been managing CLOs in the U.S. since the 1990s, and we are one of the longest active CLO managers in Europe. Our alternative fixed income and global high-yield strategies have also delivered very impressive results, supported by our proprietary research and our long-standing expertise. To support our growth ambitions, we are focused on improving the scalability and efficiency of our organization. Our goal is to achieve Global Platforms operating margin in excess of 20% by 2027, up from about 16% in 2025 and under 6% in 2023. In addition, we have ambitions to increase Global Platforms revenue per FTE to around EUR 470,000 by 2027. We will achieve this by optimizing our employee base, reducing costs through contract renegotiations, product discontinuations and driving assets into more commingled funds to improve scalability. Investments in a single global platform for public securities, enhanced risk analytics are also keys to our success and our efficiency. Our strategic partnerships are vital to our growth strategy. We have a 25% stake in LBP AM in France. We will support their expansion into French and European distribution, leveraging their strengths in equities, multi-asset and in private markets. Our AIFMC partnership in China, where we hold a 49% stake, is a top 20 mutual fund company in China. AIFMC has extended its range from equity to fixed income to blended strategies with very strong investment performance. The Chinese regulatory reduction in management fees and in other fees have been well handled by the AIFMC management team. However, it has impacted our JV financial performance. Nevertheless, we still see outstanding potential in the Chinese market in the long run. In aggregate, these partnerships provide unique access to new markets and client bases, supporting our ambitions to grow and diversify our business. As part of Aegon's relocation to the United States, we and Aegon Asset Management are fully aligned with the group's ambitions and deeply engaged in supporting Transamerica's growth. Our new organizational structure allows us to better support Aegon's relocation to the U.S. without any disruption in how we run our business. This includes being the anchor manager for Transamerica, as Will just said, and we'll grow our general account assets with them, adding resources as they're further pushing into higher-yielding investment strategies. We consistently work with Transamerica to develop new higher-yielding products and have created an outstanding stable value fund for their clients. Transamerica also helps AAM by providing seed capital for the development of new strategies and existing AAM U.S. strategies. In January of 2026, we will move Transamerica Asset Management's mutual fund business into the reporting line of AAM to collect all of our asset management activities together under AAM in the U.S. Together, Transamerica and AAM have a truly symbiotic relationship with clear roles and responsibilities outlined here. Our close collaboration drives us to meet Transamerica's evolving needs as they grow their general account, and it allows us to benefit from their growth as well as capitalize on new opportunities in the U.S. market. Our financial ambitions between now and 2027 are clear. They are ambitious but achievable. For Global Platforms, we are targeting an operating margin in excess of 20% by 2027, and we expect third-party revenue to grow by about 6% annually. For the Asset Management business as a whole, combining Global Platforms and strategic partnerships, we aim for an operating result of more than EUR 200 million by 2027. That excludes TAM. In addition, for AAM overall, we plan to grow total remittances to the group by more than 5% annually through 2027, starting from a base level of about EUR 80 million in 2025. These targets reflect our confidence in the strength of our people and systems, the scalability of our business model and most importantly, the continued confidence our clients have in us. To summarize, Aegon Asset Management is a global asset manager with a large and growing third-party asset management base and strong alternative investment capabilities. The actions we have taken strengthen our business model and improved our financial performance. By executing on our clear strategic priorities, we are well positioned to further enhance our operating margin and achieve our ambitions for 2027. Thank you.

All right. Thank you very much, Shawn. And -- so I'm now going to invite everybody back on stage for the second Q&A session. So same approach as before. I'll be standing here moderating, and you can ask your questions by raising your hands and someone will give you a mic. I'll start with Nasib this time.

Nasib Ahmed from UBS. Questions -- I'm here. So Will, thanks for the detail around the life insurance business. Just on -- so you mentioned re-risking could get you 30 basis points. That's around EUR 250 million to, I think, EUR 400 million. Is that already in the numbers? And also another number question on the fixed index annuities. You said EUR 500 million to EUR 1 billion. That's already in the new business. I'm assuming that's what's driving the OCG down. Second question on targets. There's a couple of targets that I'm missing, the WFG multi-ticket target and the midsized plan target. Any rationale for removing those or unless I've missed them? And then on Asset Management, I noticed on the separate account, you're only managing 18% within the affiliates. What capabilities can you build to get more policyholders to invest in your Asset Management solutions?

All right. Thank you. Will, do you want to start?

Yes, may I ask for a repeat of the first question. I didn't quite...

Yes. So you said it's 1 basis point of re-risking gives you EUR 8 million, and you said you're 30 basis points off the market, right? So the question is, is that in the numbers?

I understand. So as I said in my comments, neither FIA nor the general account is embedded in the financial guidance. So fully, it would be considered additive, incremental and outside. So let me just start by saying that the guidance we offer on operating results, OCG and net remittances are in our embedded plans, ones we're committed to, clear path to achieving. We have ambition to create better trajectory, better results and to do it long term beyond the '27 time horizon. In our general account, we see room within comfortable room to be able to begin to invest for higher yields well within our risk appetite and well within our framework. We don't intend for that to happen overnight. One reason to start with new money investing, which is supporting our sales volumes as well as reinvestment is that it happens over time. It's a dollar cost averaging concept as we go through time. So as we add capabilities and as we add that yield, we would expect that to be additive to value creation. That's one point. Second, the FIA plans we have are not embedded in our current new business strain. Our new business strain today, which is supporting the investments that I talked about in Life, our RILA product and our Stable Value is what is embedded in the OCG guidance that we have.

There are other questions you want to comment on the...

On the multi-ticket. Yes. So there's a couple of operational KPIs. We -- when we looked at our '23 Capital Markets Day, the big emphasis was on driving the financial earnings power of the company, right? Operating results, OCG and supporting the net remittances. In addition, we offered operational KPIs that we felt were important -- could be important drivers to get there. Indeed, you've pointed out 2 operational KPIs I didn't highlight today. We actually went -- it wasn't just multi-ticket agents. We looked at multi-ticket as well as multiproduct. In both multi-ticket and multiproduct, we have fallen short of our ambition. I think I mentioned it that we see a room to improve in the overall productivity. We're on track for recruiting, but the underlying productivity of agents, we want to improve, and we think we can get back to those ambitions and catch up with a development of capabilities and technology that can make it easier for agents to do business and activate their clients. That's one. In terms of the midsized plan target, we were pointed that as a segment that we are targeting as an attractive segment of retirements, small businesses, medium-sized businesses and full plans. We've actually had success in installing our ancillary solutions strategy more broadly than midsized plans. You can obviously see that we're on track for our ROA targets. So we simply didn't highlight it. But indeed, we are a leader in the midsized business place and full plans.

All right. Shawn?

For me?

Yes. For the last question and the...

The affiliates question, we run just about all the fixed income that capabilities are for unique fixed income in the affiliate book now. So to grow that, one, we would need other capabilities that we don't have in the U.S. at the moment or in some asset allocation strategies, there are multiple managers within that, and we can further penetrate potentially in that strategy. But to materially change, it would require capabilities, we do not have yet in the U.S.

I guess would you lift up teams to develop that capability from competitors?

It's possibly, but it's not my focus. I'm focused organically on how to deal with what I currently have.

All right. Farooq?

That's very interesting presentation. Well, in terms of the new initiatives you talked about, can you talk about the phasing of it? I mean it feels like with WFG, you can do fixed annuities immediately. You have the capability, you've done it in the past, same with the re-risking. So can you talk about some of the phasing of it in the next few years? Secondly, how important is it? I mean, this is a question actually for Lard as much as individual. And how important is it to have an asset manager that's global to be listed in the U.S. when you look at your peers or strategically, the synergies that you get from having that in the business or the way that people trade you, is this really, really central? And then my second question you kind of -- my third question, you kind of answered, but I was just thinking inorganically in Asset Management, maybe not now, but wouldn't that be something you'd eventually need to develop in the U.S., for example, a bigger equities capability?

Let me take that first, Will. So on Asset Management, if you look at the Asset Management capabilities and you look at the products that we offer, whether it's in the U.S., whether it's in the U.K., whether it's in other markets, the products all have long-term savings elements, retirement, building up capital basically for our clients. Therefore, the Asset Management capability is an important capability to have, not only for the obvious, let's say, financial benefits, but also in product design, in -- this is so integral to it that also the intangible fabric that you have to have access to, in this case, more than 350 specialists and investors is something that is very important for the product design and product capabilities that we are building. So that's number one. Number two, our Asset Management business is a medium-sized asset manager. We know that. But if I look at the improvement potential of it, pretty big. And if you see where the margin improvement has come from, so we have 3.5% margin, was it in '23, supported by the work of Shawn and his crew. They're now at 16%. They want to expand to 20% and beyond 20%. So I think there's a lot of financial room that I'd like to see happening because I like these capital-light earnings and those things are valuable. I'd like to see that coming across. So I like the model that Will and Shawn both were explaining, which is that Will says, look, I see opportunity on a risk return basis to pick up yield over time in my general account, which, by the way, is growing as a result of the growth of Transamerica. Number two, he's saying, look, I got an Asset Management business, which is more and more skewed toward alternative fixed income products. That's very helpful for me. That's why it's an anchor capability that he internally uses by collaborating with Shawn. Then in addition, he's saying, I'm going to add other asset managers where needed because asset managers can't be all things to all people at the same time. So that's only good. And that actually optimizes the model of having an in-house manager with the other managers that you complement with. And as a result, Will cannot only help to structurally over time on a risk return basis, pick up more yield in his general account, but secondly, also power potential new product offerings like the broadening initiative that Will and the team are working on broadening the product offering in the annuity space. So for all those reasons, unlike good, let this happen, let this continue. There's a lot more value to be created here, and that's what we're focused on, okay? When it comes to acquisitions or inorganic activity, I said that we are focused on our organic path, whether it's all the work that Shawn and the crew is doing for Asset Management, where there's a lot of work to be done, whether it's all the work that Will and his team are doing on the U.S. and the international markets, et cetera. That's what we're focused on. But if there is an acquisition opportunity that makes a lot of sense financially, that we're ready for, that accelerates our strategy, ticks all the financial boxes, we're here to make money. We're here to create value. That's what we've been doing over the last 5 years. We will continue to do that in the coming years.

All right. Will, on the...

Will, on the other question.

On the other question.

I would just -- furthermore, the insurance industry economic value chain, an important aspect of that is Asset Management, and we don't want to forfeit that. We want to benefit from that. So being able to get most of the synergies from the compound of economics is an important way that we think about it. As it relates to our general account initiative, we've added a Chief Investment Officer, and we would expect that we would begin to phase in this work through '26, '27 and '28. The -- what determines the phasing? I think the phasing is determined in part by prudence of relative value investing. I would say that is an important part. I think, too, it's paced with the level of our new business and reinvestment and it's paced with our origination sources. So I view this as something that is sequenced carefully, prudently as a way that we run the company and the way that we deploy our assets in our general account, not as a big bank. One supports the other. Up until this point, we purposely built our strategy that we announced to you in 2023 and all the embedded plans based on where our advantages are -- were at the time, but also where we could win around our limitations. At that time, our general account was not growing, and we needed to demonstrate that we could fire up the Transamerica commercial engine to indeed get it growing. So up until this point, we have been participating in products where having competitive yields were not a part of the equation. What I'm signaling to you in FIA is that we will need -- we will be very disciplined and we'll be very targeted about the manner and form in which we begin to select products where yield is in the competitive equation. So the strategy around the general account goes hand-in-hand with unlocking and opening the door for the FIA. Now the manner and form in which we do this, we ultimately need to finalize. The business case indeed needs to be value generative around the parameters that Mr. Duncan -- Mr. Russell and Lard laid out earlier. And as we have those updated district, we tend to -- we will update you as we have this finalized, we'll update you and expect it will be next year.

All right. Michael?

Lots of little questions. The first one is just a simple number one. The EUR 75 million, does it come in 2025? Or is it '26?

We injected it in 2025. The benefits in '26.

'26. Okay. And then on retirement, I think earlier in the conversation, I had the impression that it was still a net outflow, but at some stage, it swings to net inflow. And I just wondered when this happens? And maybe can you give us a number? And then on a key question, Duncan approved this question. Who's your peer? I mean, who you're trying to beat in the U.S., just to give it a feel? I know we're not going to be following you in 2 years. You'll be aware you'll be in the U.S. But just in the meantime, it would be nice to know. And the final question is -- two questions. The Asset Management, does it include the business that you got from ASR, managing the mortgages and stuff? Okay. So that's not because they wanted to buy it. And then the final point is on TCS. Can you -- the impression I had from what you were saying just before the break is this kind of J-curve and you're actually getting to the acceleration. Maybe you can give us a feel for that.

A lot of good questions...

All right. Do you want to start, Will, on the retirement question?

Michael, how about I start with the TCS. When the transformation began, Transamerica's operations and service and product and technology support behind the Protection Solutions division, Life and Annuity business was wholly outsourced. As a part of our strategy in 2023, we brought that back in-house under our control. And that was critical because there were -- there are many high-value touch points in operations and service that without that, you simply have not earned the advisers and the agents trust to choose Transamerica as their product provider. They are not beholden to use Transamerica. It is a free country, and they have a broad array of carriers that they can choose to. So we must have a company, a culture where we realize that we're earning our advisers and agents business each and every day. Operations and service are a really key part of that. We have fully resolved the TCS or the outsourcing situation with a large third party. That is now fully in-house. That was completed in the first quarter of this year. And from that position, we now, I would say, also have the ability to have improving operating leverage as an arrow in our quiver. And it sets us up to be able to think about product extensions and market extensions. Keep in mind, our Life business is built on very high policy volumes. I think we are -- we are the #5 in number of policies issued in the U.S. market. So therefore, our operations are even more paramount. So it has opened itself up. I'll jump to your second question, just to keep it here, Michael, on retirement. Stepping back, the retirement industry as a whole is in net outflows. And it's in net outflows because of the baby boomer generation exiting the workplace, having accumulated retirement balances during their career. They then move those balances out of the workplace, retirement industry into individual accounts while the next generation is younger, entering the workforce and building up their account balance. So at a certain point, this industry is about getting positioned for when the next generation, which, by the way, is much larger than the baby boomer generation in the workforce begins to accumulate sufficient values, you will see the industry at a certain point move in to positive flows. We were performing worse than our industry peers in net deposits. We have restored that. So we now are performing around net deposits consistent with peers. They remain, and I would expect them to remain negative to hover around 0. There may be quarters from time to time where we would have positive net flows, but it's because your retirement plans can come in and leave in large amounts because they're institutional accounts. That's why the emphasis is on margin and ROA. That's why I point to growing from 8 basis points ROA to 11 basis points ROA and then ultimately to mid-double digits. It's imperative.

Competitors?

Who do we compete with in the U.S.? I wouldn't say there is -- if you take companies, there rarely are direct peers. But if I was thinking about Transamerica as a leader in life insurance, retirement and retail distribution, if there was one peer that's most similar at the aggregate level, perhaps Corebridge. When you get into individual business lines, we think of it a little differently. In distribution, I think Primerica. In retirement, I think Voya. In Life, I think Nationwide Financial. Each are focused on the similar business model and similar target market of the ultimate customer.

All right. And Duncan, on the -- does it include the business you got from ASR? I think the answer is yes.

Yes.

My business, yes. One of the 450 clients is ASR.

All right. Ian?

Why did you choose not to include the U.K. asset manager in the U.K. strategic review? And also, if you could talk about the synergies you see between the Asset Management businesses and why you, in particular, think you're the best owner of the Dutch asset management business? And then on the U.S. general account, you mentioned a willingness to add external managers to that. Would you be looking or does that include looking at a strategic partner or a strategic partnership with a U.S. alternative asset manager?

Yes. So let me answer all those questions. The first one is we deliberately did not include our Asset Management business in the U.K. in the review. We believe that the total setup that we have for the asset manager, the strategies and where they are being managed for. It's a global business model, right? So you have assets, investor teams and then you sell a lot of these strategies across the globe to multiple mandate givers, if you will, potential clients. So in the U.K., we are not including the Asset Management business in review. In terms of synergies, as you've seen from the deck, there's EUR 43 billion that is being managed in the U.K., U.K. AUM. It's the general account of the insurance business. The fees associated with that, by the way, are relatively low. It's really not much. And obviously, whatever happens in that review, we aim to protect the value of our asset management fees that we're generating in the U.K. So that's number one. Number two, yes, we think we're a good owner of our business -- our Asset Management business in the Netherlands. It's EUR 120 billion of AUM that you're running out of that for Continental Europe. That's being driven from the offices in the Netherlands, profitable business, aim to grow the profitability and the margins. So again, it's an interconnected business model that operates globally and that has investor teams managing the strategies. So we're happy to own that. Then the final question that you had on adding external managers, will you look at strategic partners? We're evaluating, so Will and myself and the others, we're evaluating how to set up the model that Will was describing as one of the initiatives that you're on, Will, which is to add to the anchor partner of our own in-house manager, other managers, and we're still looking at the best way of how to do that as part of that initiative.

All right. [indiscernible]

Just a quick one. I mean you say that WFG is sitting at the center of what you're doing. Just -- I'm wondering, I mean, you have Primerica, but no one has bid for it. I mean if it was so essential, you would have thought that one of the other Life peers would have thought that they would have bought it because it would have been interesting to follow your model. So I would like just to have your thoughts on this.

Jason, I don't understand one thing. Did you say WFG did you hear the question well?

In essence, you have WFG. So first, the major competitor is Primerica. And I was wondering if Primerica wouldn't be better, why Primerica has not been bought by other -- why other insurance would not be interested to create the model you have where basically it's integrated, they buy it and they have it so that they can build up internally the sales of the insurer as much as they can.

So there are a number of peer business models in the U.S. that are recruiting-based agents and agency-led businesses. WFG is one. Primerica is another. Primerica was once a Citigroup subsidiary before becoming -- before IPO-ing out as a stand-alone public entity. And there are indeed a few others, some public and some private. So I think the value -- the advantage that you have in the insurance business of having access to a customer cannot be underscored. It gives you knowledge beyond access. It gives you knowledge, experience, data of what customers want, what they need, how to design products, how products behave. It's a strategic advantage and imperative. So I believe it is indeed a crown jewel of Transamerica and one in which we will foster to be a better business, not only for ourselves, but also for our agents and our agency leaders.

And just to add to that comment, Jason, there's one more thing to it. If you look at our model that we operate, WFG is not only working exclusively for Transamerica. So what this means strategically for us is that we have unique access to all these middle market households with the second largest retail distribution force in the U.S. That's number one. So the reach is there. The access is there. Number two, if we choose to manufacture in a certain market segment like Index Universal Life, we -- they sell that for us. So they're a big producer in new self swap volumes. And we actually create manufacturing profits and distribution profits. But if they are sitting in front of a client and they have a solution that we choose not to manufacture, then they offer products from other players, right? And we still make money on it, the distribution piece of the value chain. So in that case, it is strategically a very important capability that we have because not only gives us -- it doesn't give us reach and all the things that Will was saying, but also because we want to choose in making sure we manufacture where we believe we have the great capabilities and also really risk-adjusted profit returns that are good, that where we do not wish to manufacture, we still pick up the distribution angle in the value chain.

And to add to Lard's comment, and WFG is relevant to leading world-class insurance companies in the U.S. and Canada. So our 2 largest life insurance partners are Nationwide and PacLife, high-quality companies in Canada, Manulife.

Manulife, yes.

Inside our annuities, which is predominantly third party, I would say it's 90% third party. Our best carrier partners are Nationwide and indeed Allianz. So not only is WFG an important originator of solutions for Transamerica to further bolster large point, it's also a leading and important relevant company for other carriers in the industry.

A gentlemen over there, Iain.

A question for Will. So moving to higher-yielding assets, obviously involves taking more credit risk at a time when credit spreads are really, really low. Just curious because as a shareholder, I like the fact that it's 97% investment grade now. Where do you see that going by the time this transition ends in '28?

We will maintain our conservative well-positioned, prudent asset partner relative to peers. So we don't view that changing, number one. Number two, one reason why you hear my comments measured where I say benefits will be realized over time and incrementally is the nature of where we happen to be in the macro credit cycle and where relative value might be at any particular point in time. So I think the emphasis really is focusing on building out the capabilities to be ready. Building out the capabilities of the CIO office expertise, building out the origination sources. And then the foundation is set and you have the ability to begin to make those relative value prudent decisions that will remain within our risk appetite and our risk framework and maintain our relatively conservative and diversified portfolio position.

All right. Right here.

It's Abid Hussain from Panmure Liberum. I've just got one question. It's on the U.K. business. So I just want to go back to the strategic review. What's within the perimeter? Have you sort of given any color of what's in, what's not? And then in terms of the RFP process that you're running, is that a focus on a single disposal? Or do you think you maximize value by breaking up the business into its component parts? So just really trying to understand how you're going to maximize shareholder value in that review.

The perimeter, let me be clear about that first. That is our Adviser platform business, our Workplace business and the insurance unit-linked business that we have. So it's not the Asset Management business, but it's everything else. That's the perimeter that's under review. We have launched a review today. So we are going to look at the best way we can accelerate the progress of the value creation of our U.K. business. All options are on the table, including a potential divestment, and we aim to conclude that review in the first half of 2026.

All right. Michael for question 6.

They're very light. The first one, I'm not sure, but I had in memory that was it last year or before you said, no, WFG is selling tons of fixed annuities, but we don't want to do it. If I'm right, what has changed? And the second one is a very cheeky question because I think you didn't want to disclose it, but who knows. The new business train at $200 million a quarter, can you give us a feel for how big it could become?

Yes. I'll take the first, and Duncan perhaps the second. Indeed, when we were here in 2023, we put a flag in the ground that this company needed strategic clarity and focus. And we needed to have a discipline of targeting markets where we had a right to win. And our conclusion, and my conclusion, I shared with you that there were 3 businesses that had the capabilities and that they could win with the advantages and with the reality of limitations because that's just -- right, that's the world. And it was WFG, it was life insurance and it was retirement. But you noticed we did not talk about annuities and we did not commit to annuities as a part. And there's a few reasons. Number one, it was the business most impacted from the large outsourcing arrangement. It's a business that is -- that would have required more sophistication in operations and service because you're primarily originating those savings with financial high-quality banks, broker-dealers that are SEC registered and operated. You need the ingredient of yield, competitive yield, which we simply were not at that point in terms of capability and sophistication to have. We need the product capability and distribution capability. So just an objective view of the ingredients. We simply did not have the ingredients where I felt we could win and compete on our terms. What's different today? Operations are back. Product skills are back, building asset yield capabilities. We launched a RILA product, very focused, single product to rebuild our third-party distribution, done, $4 billion of account value. We've put ourselves in a position to now make that choice and open the door for an add-on extension. So that would be the difference today, Michael, versus 2.5 years ago.

Duncan?

On the second question, no, unfortunately not, we're not going to give the components of OCG going forward. We will report it, but we're not guiding to it. And one of the reasons for that is that some of these things can move around a bit and some interaction between the different components. And I just wanted to simplify.

Farquhar from Autonomous. I just have three questions basically, mainly probably all for Will really. Firstly, I'd like your sense of where kind of redomiciling will make the biggest difference for you and maybe an ordering. You've obviously mentioned a few initiatives to work through, but I just really wondered which -- where you see it really making the biggest difference in order? And on a related point, where do you think moving to U.S. GAAP will ultimately align the business and maybe shift the way it's managed? And then secondly, on the [ GA re-risking ], what's the reason for accepting the yield gap before in terms of where you were? And ultimately, where will it shift to strategic asset allocation over a cycle, which obviously will be timing dependent? And then thirdly, coming back to the question I had earlier in the first session on the inorganic options, where would that be most able to accelerate the organic strategy you do have? And obviously, you've spoken a lot about latent compounding economics, but I also wonder if there are any businesses that you actually see scope to maybe reinforce on the strategy side.

Thank you. So I think the -- from my perspective, the largest impact of redom is there's power and clarity, particularly in large organizations. Clarity and focus. And so when a company with our ambition, with our resolve and resilience, and I'm referring to the whole of Aegon Group makes the strategic decision to go, you put the whole power of the company behind it. So I think that's one. Second, when you have strategy and financial reporting aligned, I think it simplifies, streamlines and makes a lot of processes efficient. And then lastly, comparability of peers is equally a simplifier and accelerator. Remember, we are competing in the marketplace against very talented competitors. We're also competing for talent. And being able to now have strategy and financial reporting ultimately aligned in GAAP also really opens up the funnel for more talent that would be versus being an IFRS 17 talent. There's not as much finance, strategy, technical insurance company talent that has that experience in the U.S. And what I keep reflecting on in this decision is there's been a number of companies that have come before us that have made a similar journey where they've focused their future onto the U.S. They've gotten strategically and financially aligned. Now the form of their journey might be different. But without exception, each have improved their strategic and financial performance and create a lot of value. So I am quite energized that the form in which we aim to take this company is that the Aegon shareholders can benefit from this value creation journey that can come from a redom to a very attractive market.

The other two. The question was why are you accepting a yield gap? This, I think, goes to the asset side of the portfolio. Why have you accepted it in the past and et cetera?

One, we've accepted a yield gap I wouldn't call it accepting a yield gap. I would say that we have been able to be successful in our markets without yield really being a part of the equation. Our IUL flagship product is a death benefit-oriented product. So it's predominantly underwriting is the underlying kind of source of margin. There's a bit of spread. In Stable Value, while that's a spread product, it's not a competitive yield market because you're -- it's inside of the record-keeping retirement plan. So I think as we now move into what we will not accept is entering markets where there is a yield gap. And I think that's the point that I'm really signaling is that as we move into and get bigger in RILA, choose to enter into FIA, we would not do that by accepting a yield gap because we have pricing discipline. And it gets to the heart of picking markets where you have a right to win. So I would think about that not as looking backward as a yield gap, I think about as looking forward, we will not compete and operate with a yield gap. And then could you repeat your last question on organic options?

Inorganic, I think.

No, I think inorganic...

Inorganic.

I think it was inorganic.

Yes, I was just asked is -- the other question I asked to Lard as well is obviously, you've got your core organic strategy. There are options potentially on the inorganic side of things where that might accelerate things. I just wondered where you think that might be there in terms of where the strongest scope for that would be given the latent kind of compounding economics you've talked about and maybe in terms of weak points within the business where actually reinforcement might help.

Yes. So Farquhar, as you know very well, good deals are few and far between. And they are very opportunity driven. It's where opportunity meets discipline, where this needs to happen. I think the American marketplace is a huge marketplace. The life insurance marketplace is a huge marketplace. There's many, many players in many, many different parts of the market. Having said that, we are focused on our organic strategy. If we -- and there's a lot that Will and the team are trying to achieve and there's a lot of focus on that. If there is an opportunity that presents itself, we'll look at it. We'll compare it to -- compare it. We will assess it against very strict financial and nonfinancial criteria. And if it all makes sense, we go after it. If it doesn't make sense, we don't. It's pretty simple.

All right. You already asked 7 questions, Michael. So this is like the final question, and this would actually be the final question of this Q&A session, if that's okay.

On the stage, my question is, which one of you is the most ambitious? In other words, whose words should I write down first? Is it Will, I want to be the best in Life? Is it Lard saying I want to make the most money? Is it Shawn making I want to make the biggest margin or is it Duncan who is the most -- biggest value creator, I know...

It's me. Do you want to do a roundtable about who is most ambitious? About?

Incentives.

Incentives. Yes. So you mean financial incentives for all of us? Okay. So we have a remuneration policy that we're all on, which is a fixed compensation, a short-term cash-based incentive plan for a year on financial performance criteria. And then we have on top of that a longer-term LTI, as we call it, a long-term incentive with a 3-year performance cycle based on financial criteria and a small component on nonfinancial criteria. And that is all stock-based. The -- there are target levels that are being set for this. So over the short-term incentives, they are on financial KPIs, and they are set target levels every year. And then there's a curve, which is incentivizing outperformance of those. And there is a -- for the long-term incentive, it's a 3-year horizon, a 3-year performance cycle, also the same thing. There are target levels, but then there is a curve in which you can outperform to have the incentives in the right place. So that's where we're actually all on. The biggest driver. So on the STI, so the short term, there are financial KPIs. They have to do with commercial targets. They have to do with free cash flow. They have to do with OCG, an operating result, for instance. And when it comes to the long-term metrics, the metrics that we have published are return on regulatory capital. And the other one is a relative TSR, so relative total shareholder return measured against the peer group.

All right. Okay. Thank you very much. Thank you for all your questions. Thank you for all your answers. So we're going to have drinks soon. But before this, Lard, I'll leave to you to give the final words.

Yes. So first of all, I would like to thank all of you for being here today and to spend time with us and for all of you on the webcast also to have spent time with us today on this. This morning started with a long press release where we had a lot of news to share, and I'm very pleased that we were able to, in the dialogue, explore what that news really means and be able to discuss that with you. So I want to thank you very much for that. I want to leave you with a couple of thoughts. If you just take a step back, just take a step back, I would submit to you that the transformative nature and journey since 2020 of this group is a pretty unique journey in our industry. We've told you what we have achieved so far. We have shared plans with you what we aim to achieve in the future. But I hope that you also have seen that we are really focused on value creation, nearly obsessed with it and on building better businesses. And I also hope that you have seen that we're not shying away from any difficult decision. We have taken those decisions in the past. And quite frankly, if you look at the monumental decision we took today for 180-year-old company to move the company to the U.S. to change the name of the company of the group. That's a pretty profound statement that we make in the total trajectory of this company. And why are we doing that? Because we are led by value creation and creation of better businesses, and that is what we do. We have done so, and we move at a decent pace. This team will continue to do so. We are committed to our customers. We are committed to provide the best possible service to grow profitably, to create value and to remain our financial discipline and rational approach to everything. And on top of the plans or in addition to the plans that you have seen today and we presented to you today, we have launched a review of our U.K. business. We have launched a EUR 400 million buyback for the coming year. And we have the plans and the opportunities that the U.S. marketplace has to offer, the Asset Management business with all its potential to grow better margins and to improve the margins over time and the international businesses that have created value and that become valuable every year again as they profitably grow. With that, I would like to wish you the most wonderful holiday season that you can have. And I would also like to thank all the people on the webcast. Have a wonderful holiday season. To my colleagues at Aegon that are watching this, thank you very much for everything that you are doing for this company. We are an intent shop, and we will continue to be an intent shop, and I wish everybody a good holiday season, and I invite you here to share a drink with us. Thank you very much.