Aegon today presents its plans to accelerate the transformation of Aegon UK into a leading digital savings and retirement platform. The plans will be outlined at a webinar hosted from London by Lard Friese, CEO of Aegon, and Mike Holliday-Williams, CEO of Aegon UK, together with other senior leaders of Aegon UK.
Aegon CEO, Lard Friese, commented: “Aegon’s ambition is to create leading businesses in investment, protection, and retirement solutions. Aegon UK is well positioned to capture the opportunities of the UK’s large and growing market for long-term savings and retirement solutions. I have great confidence in our UK colleagues to deliver on our plans to transform Aegon UK into a champion business.”
Aegon UK operates an interconnected business model with three growth franchises: the Workplace platform, the Adviser platform, and the Advice franchise. These three franchises serve around 2.5 million customers with GBP 104 billion of assets under administration (AuA) at the end of 2023. In addition, Aegon UK manages a portfolio of traditional pension and annuities products with 1.3 million customers, and a trading and custody platform that administers assets for institutional clients.
The Workplace platform offers retirement solutions for large and medium-sized employers and already occupies a top three market position in terms of winning new business. The company plans to further increase the digitalization and automation of the Workplace platform, enhance the retirement propositions, and further personalize the customer experience. This is expected to lead to significant growth of net flows into the Workplace platform to more than GBP 5 billion per year by 2028, resulting in an increase of AuA from GBP 53 billion at the end of 2023 to more than GBP 85 billion in 2028.
Aegon UK’s Adviser platform offers long-term savings and investment solutions to advisers and their customers. The company plans to focus on the 500 adviser firms that currently contribute around 70% of the Adviser platform’s gross flows. Aegon UK will invest to further enhance its proposition, while also simplifying technology and increasing automation to build on the leading online customer and adviser journeys already in place. The company aims to turn net flows of the Adviser platform positive by 2028. AuA on the Adviser platform is expected to remain stable at above GBP 50 billion through 2028.
The Advice franchise offers financial planning guidance and advice to Workplace platform customers and other corporate partners, including the recently extended partnership with Nationwide, and is expected to drive net flows into the Adviser platform. By embedding the advice proposition in customer journeys, Aegon UK plans to deepen its relationship with its Workplace customers and expand to other customer segments, while also further integrating its businesses and reducing costs.
The transformation will enable Aegon UK to grow the combined AuA of the three growth franchises to above GBP 135 billion by 2028 and to increase its operating capital generation by around 12% per year from a base level of approximately GBP 120 million in 2024. Aegon UK’s IFRS operating result is expected to increase to around GBP 190 million in 2028 from around GBP 165 million in 2024. Remittances to the Holding are expected to increase by around GBP 5 million per year during the transformation, starting from a base level of approximately GBP 100 million in 2024. Aegon UK will fund the transformation and the remittances out of its operating capital generation and its own funds allowing a small decrease in its UK Solvency II level. There is potential for higher remittance growth after the investment period.