Dutch gov't to inject 3 billion euros into insurance Co Aegon
29/10/2008 17:15
The Dutch government is reinforcing the capital position of Aegon Group by
3 billion euros (US$3.84 billion) to help it tide over the financial
crisis.
The government will buy 3 billion euros of non-voting shares to
enhance the capital strength of Aegon, the largest Dutch insurer, the country's
Finance Ministry said in a statement yesterday.
"With this capital
reinforcement, Aegon remains a healthy and well-managed insurance company that
has a strong capital buffer," it said.
The Dutch government set aside 20
billion euros (US$25.6 billion) earlier this month to help "sound and viable"
financial enterprises that are facing unexpected external shocks. Aegon is the
second institution to tap that fund after ING.
The government will nominate
two supervisory board members, who will have the right to veto important
decisions related to investments and remuneration schemes. They will also join
the audit committee, the remuneration and nomination committee and the corporate
governance committee of the supervisory board.
All members of the Aegon
executive board shall relinquish their bonuses over 2008, and Aegon shall
develop a sustainable remuneration policy and limit exit schemes to one year's
fixed salary, the ministry added.
Aegon yesterday announced a loss of 350
million euros (US$448 million) in the third quarter. To boost its financial
position, the company said it will not pay out dividends to shareholders this
year.
The company said it needs "a more substantial buffer" to support its AA
credit rating.
Xinhua
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