Financial risks (Tables)

12 Months Ended

Dec. 31, 2018

Aegon group level long-term counterparty exposure limits are as follows:


Group limits per credit rating Amounts in EUR million	2018		2017
AAA		900		900
AA		900		900
A		675		675
BBB		450		450
BB		250		250
B		125		125
CCC or lower		50		50

Schedule of Maximum Exposure to Credit Risk

The table that follows shows the Group’s maximum exposure to credit risk from investments in general account financial assets, as well as general account derivatives and reinsurance assets, collateral held and net exposure. Please refer to note 49 Transfer of financial assets for further information on collateral given, which may expose the Group to credit risk.


2018	Maximum exposure to credit risk		Cash		Secu- rities		Letters of credit/ guarantees		Real estate property		Master netting agree- ments		Other		Total collateral		Surplus collateral (or over- collateral- ization)		Net exposure
Debt securities – carried at fair value		81,253		-		-		169		-		-		-		169		-		81,084
Debt securities – carried at amortized cost		-		-		-		-		-		-		-		-		-		-
Money market and other short-term investments – carried at fair value		6,307		-		484		-		-		-		-		484		29		5,852
Mortgage loans – carried at amortized cost		36,240		2,535		-		136		57,009		-		-		59,680		23,589		149
Private loans – carried at amortized cost		4,103		45		-		-		-		-		-		45		-		4,058
Other loans – carried at amortized cost		2,310		-		-		-		-		-		1,960		1,960		1,238		1,589
Other financial assets – carried at fair value		3,551		-		-		-		-		-		-		-		-		3,551
Derivatives		7,337		2,627		233		31		-		4,606		-		7,496		225		66
Reinsurance assets		20,505		-		4,035		104		-		-		-		4,139		-		16,366
At December 31		161,607		5,207		4,752		439		57,009		4,606		1,960		73,972		25,081		112,715


2017	Maximum exposure to credit risk		Cash		Securi- ties		Letters of credit/ guarantees		Real estate property		Master netting agree- ments		Other		Total collateral		Surplus collateral (or overcollat- eralization)		Net exposure
Debt securities – carried at fair value		84,344		-		-		242		-		-		-		242		-		84,102
Debt securities – carried at amortized cost		-		-		-		14		-		-		-		14		-		(14)
Money market and other short-term investments – carried at fair value		6,809		-		719		-		-		-		-		719		25		6,115
Mortgage loans – carried at amortized cost		33,562		2,437		-		379		49,756		-		-		52,573		19,271		260
Private loans – carried at amortized cost		3,642		79		-		-		-		-		-		79		-		3,563
Other loans – carried at amortized cost		2,164		-		-		-		-		-		1,886		1,886		1,195		1,473
Other financial assets – carried at fair value		2,586		-		-		-		-		-		-		-		-		2,586
Derivatives		5,563		647		56		29		-		4,867		-		5,599		85		48
Reinsurance assets		19,200		-		4,395		137		-		-		-		4,532		-		14,667

At December 31	157,869		3,163		5,171		801		49,756		4,867		1,886		65,644		20,576		112,800

Schedule of Ratings Distribution of General Account Portfolios

The ratings distribution of general account portfolios of Aegon’s major reporting units, excluding reinsurance assets, are presented in the table that follows, organized by rating category and split by assets that are valued at fair value and assets that are valued at amortized cost. Aegon uses a composite rating based on a combination of the external ratings of S&P, Moody’s, Fitch and National Association of Insurance Commissioners (NAIC which is for US only) and internal ratings. The rating used is the lower of the external rating and the internal rating.


	Americas				The Netherlands				United Kingdom				Central & Eastern Europe				Spain & Portugal
Credit rating general account investments, excluding reinsurance assets 2018	Amortized cost		Fair value		Amortized cost		Fair value		Amortized cost		Fair value		Amortized cost		Fair value		Amortized cost			Fair value
AAA		941		15,338		1,611		12,956		-		84		-		1		-			9
AA		3,104		3,855		83		6,704		-		594		-		22		-			78
A		3,567		17,428		55		2,482		-		291		16		119		38			386
BBB		266		17,609		924		1,299		-		95		6		502		(3	)		180
BB		7		1,393		52		39		-		1		9		5		-			17
B		-		1,013		-		-		-		-		64		105		-			-
CCC or lower		-		741		-		-		-		-		1		1		-			-
Assets not rated		1,952		4,126		29,534		4,423		-		1,085		11		67		2			4
Total		9,837		61,501		32,259		27,905		-		2,149		106		823		37			673
Past due and/or impaired assets		108		1,346		277		25		-		-		-		1		-			-
At December 31		9,945		62,847		32,536		27,930		-		2,149		106		824		37			673


	Asia				Asset Management				Total 2018 ¹
Credit rating general account investments, excluding reinsurance assets 2018	Amortized cost		Fair value		Amortized cost		Fair value		Amortized cost		Fair value		Total carrying value
AAA		-		987		-		136		2,552		29,518		32,070
AA		-		372		-		-		3,188		11,626		14,813
A		-		1,823		-		5		3,675		22,542		26,218
BBB		-		2,186		-		1		1,193		21,871		23,064
BB		-		140		-		9		68		1,653		1,721
B		-		132		-		17		64		1,267		1,331
CCC or lower		-		22		-		9		1		773		774
Assets not rated		16		14		-		5		31,527		9,960		41,488
Total		16		5,676		-		181		42,268		99,210		141,478
Past due and/or impaired assets		-		27		-		-		385		1,399		1,784
At December 31		16		5,704		-		181		42,653		100,609		143,263

¹	Includes investments of Holding and other activities.


	Americas				The Netherlands				United Kingdom				Central & Eastern Europe				Spain & Portugal
Credit rating general account investments, excluding reinsurance assets 2017	Amortized cost		Fair value		Amortized cost		Fair value		Amortized cost		Fair value		Amortized cost		Fair value		Amortized cost			Fair value
AAA		958		18,935		1,658		12,727		-		137		-		1		-			9
AA		2,693		3,353		85		5,449		-		1,139		-		5		-			48
A		2,905		18,684		56		3,186		-		449		8		126		55			167
BBB		330		16,822		941		1,267		-		78		3		495		(3	)		401
BB		18		1,567		18		22		-		9		72		92		-			20
B		-		1,162		-		-		-		-		2		1		-			-
CCC or lower		-		793		-		3		-		-		-		-		-			-
Assets not rated		1,892		2,797		27,133		3,770		-		219		107		55		2			6
Total		8,796		64,114		29,890		26,425		-		2,031		193		775		54			651
Past due and/or impaired assets		35		1,145		299		41		-		-		82		1		-			-
At December 31		8,831		65,259		30,189		26,467		-		2,031		275		777		54			651


	Asia				Asset Management				Total 2017 ¹
Credit rating general account investments, excluding reinsurance assets 2017	Amortized cost		Fair value		Amortized cost		Fair value		Amortized cost		Fair value		Total carrying value
AAA		-		985		-		144		2,616		32,960		35,575
AA		-		340		-		-		2,778		10,334		13,111
A		-		1,775		-		-		3,024		24,399		27,423
BBB		-		1,920		-		-		1,271		20,983		22,254
BB		-		140		-		1		107		1,852		1,959
B		-		117		-		4		2		1,284		1,287
CCC or lower		-		23		-		4		-		823		823
Assets not rated		6		1		-		4		29,154		7,011		36,165
Total		6		5,300		-		157		38,951		99,645		138,597
Past due and/or impaired assets		-		20		-		-		416		1,207		1,624
At December 31		6		5,320		-		157		39,368		100,853		140,221
¹ Includes investments of Holding and other activities.

Summary of Credit Quality of Gross Positions of Reinsurance Assets

The following table shows the credit quality of the gross positions in the statement of financial position for general account reinsurance assets specifically:


	Carrying value 2018		Carrying value 2017
AAA		-		-
AA		9,150		13,379
A		11,041		5,242
Below A		30		24
Not rated		284		555
At December 31		20,505		19,200

Schedule of Credit Risk Concentration

The tables that follow present specific credit risk concentration information for general account financial assets.


Credit risk concentrations – debt securities and money market investments 2018	Americas		The Netherlands		United Kingdom		Central & Eastern Europe		Spain & Portugal		Asia		Asset Manage- ment		Total 2018 ¹		Of which past due and/or impaired assets
Residential mortgage-backed securities (RMBSs)		2,138		395		-		-		-		52		-		2,585		918
Commercial mortgage-backed securities (CMBSs)		3,314		35		127		-		-		537		-		4,013		14
Asset-backed securities (ABSs) – CDOs backed by ABS, Corp. bonds, Bank loans		717		1,669		-		-		-		61		-		2,447		3
ABSs – Other		1,915		247		61		-		6		323		-		2,552		40
Financial – Banking		6,423		1,473		132		92		118		815		6		9,059		29
Financial – Other		8,863		188		33		4		112		595		121		9,924		19
Industrial		21,060		1,515		213		5		142		2,486		33		25,457		187
Utility		3,572		115		60		5		46		370		-		4,169		144
Government bonds		9,607		15,948		438		650		238		457		17		27,356		8
At December 31		57,609		21,586		1,064		756		662		5,696		176		87,560		1,362

¹	Includes investments of Holding and other activities.


Credit risk concentrations – Government bonds per country of risk 2018	Americas		The Netherlands		United Kingdom		Central & Eastern Europe		Spain & Portugal		Asia		Asset Manage- ment		Total 2018 ¹
United States		8,891										362				9,253
Netherlands				6,040												6,040
United Kingdom						356		1						17		374
Austria				1,102						4						1,106
Belgium				1,000		21				6						1,027
Finland				949												949
France				1,292		33				5						1,329
Germany				4,397												4,397
Hungary		3						410								413
Luxembourg				786						1						787
Spain				89				3		206						298
Rest of Europe		103		264				236		11		9				623
Rest of world		580		30		28		-		5		86				730
Supranational		30														30
At December 31		9,607		15,948		438		650		238		457		17		27,356

¹	Includes investments of Holding and other activities.


Credit risk concentrations – Credit rating 2018 ²	Government bonds		Corporate bonds		RMBSs CMBSs ABSs		Other		Total 2018 ¹
AAA		20,479		772		6,505		1,753		29,511
AA		4,949		3,264		1,721				9,934
A		614		18,482		1,490		1		20,587
BBB		961		20,360		349		1		21,670
BB		215		1,279		144				1,638
B		136		1,003		69				1,207
CCC or lower		1		302		1,318				1,621
Assets not rated								1,391		1,391
At December 31		27,356		45,462		11,596		3,147		87,560

¹	Includes investments of Holding and other activities.

²	CNLP Ratings are used and are the lower of the Barclay’s Rating and the Internal Rating with the Barclay’s rating being a blended rating of S&P, Fitch, and Moody’s.


Credit risk concentrations – debt securities and money market investments 2017	Americas		The Netherlands		United Kingdom		Central & Eastern Europe		Spain & Portugal		Asia		Asset Manage- ment		Total 2017 ¹		Of which past due and/or impaired assets
Residential mortgage-backed securities (RMBSs)		3,025		556		17		-		-		57		-		3,655		1,022
Commercial mortgage-backed securities (CMBSs)		3,375		28		146		-		-		537		-		4,086		10
Asset-backed securities (ABSs) – CDOs backed by ABS, Corp. bonds, Bank loans		751		1,529		-		-		-		47		-		2,327		3
ABSs – Other		1,688		270		88		-		1		331		-		2,378		35
Financial – Banking		6,525		1,440		124		102		104		730		-		9,026		3
Financial – Other		9,028		212		58		3		114		498		137		10,069		4
Industrial		21,975		1,726		255		7		129		2,344		-		26,435		62
Utility		3,386		119		65		3		45		309		-		3,927		-
Government bonds		11,319		15,531		1,060		603		253		466		17		29,249		14
At December 31		61,073		21,411		1,812		718		646		5,319		153		91,153		1,154
¹ Includes investments of Holding and other activities.


Credit risk concentrations – Government bonds per country of risk 2017	Americas		The Netherlands		United Kingdom		Central & Eastern Europe		Spain & Portugal		Asia		Asset Manage- ment		Total 2017 ¹
United States		10,501		32		-		-		-		372		-		10,906
Netherlands		-		5,777		-		-		4		-		-		5,781
United Kingdom		-		-		946		1		-		-		17		964
Austria		-		1,154		-		-		4		-		-		1,158
Belgium		-		1,065		23		-		6		-		-		1,094
Finland		-		938		-		-		-		-		-		938
France		-		1,216		34		-		5		-		-		1,255
Germany		-		4,233		28		-		-		-		-		4,261
Hungary		3		-		-		402		-		-		-		405
Luxembourg		-		785		-		-		1		-		-		786
Spain		-		89		-		2		203		-		-		294
Rest of Europe		133		205		-		198		16		17		-		568
Rest of world		652		36		29		-		14		77		-		809
Supranational		30		-		-		-		-		-		-		30
At December 31		11,319		15,531		1,060		603		253		466		17		29,249
¹ Includes investments of Holding and other activities.


Credit risk concentrations – Credit rating 2017 ²	Government bonds		Corporate bonds		RMBSs CMBSs ABSs		Other		Total 2017 ¹
AAA		21,855		792		7,102		3,157		32,906
AA		5,462		2,879		1,700		-		10,040
A		311		20,765		1,443		-		22,520
BBB		1,198		19,045		396		6		20,646
BB		269		1,395		178		-		1,842
B		152		1,011		111		-		1,273
CCC or lower		2		309		1,516		-		1,828
Assets not rated		-		3		-		95		98
At December 31		29,249		46,199		12,446		3,258		91,153

¹	Includes investments of Holding and other activities.

²	CNLP Ratings are used and are the lower of the Barclay’s Rating and the Internal Rating with the Barclay’s rating being a blended rating of S&P, Fitch, and Moody’s.


Credit risk concentrations – mortgage loans 2018	Americas		The Netherlands		United Kingdom		Central & Eastern Europe		Spain & Portugal		Asia		Asset Manage- ment		Total 2018 ¹		Of which past due and/or impaired assets
Agricultural		69		-		-		-		-		-		-		69		15
Apartment		3,993		-		-		-		-		-		-		3,993		92
Industrial		871		-		-		-		-		-		-		871		-
Office		1,342		-		-		-		-		-		-		1,343		-
Retail		1,457		9		-		-		-		-		-		1,466		1
Other commercial		258		35		-		-		-		-		-		292		2
Residential		12		28,193		-		-		1		-		-		28,207		227
At December 31		8,002		28,237		-		-		1		-		-		36,240		337
¹ Includes investments of Holding and other activities.


Credit risk concentrations – mortgage loans 2017	Americas		The Netherlands		United Kingdom		Central & Eastern Europe		Spain & Portugal		Asia		Asset Manage- ment		Total 2017 ¹		Of which past due and/or impaired assets
Agricultural		77		-		-		-		-		-		-		77		8
Apartment		3,371		-		-		-		-		-		-		3,371		-
Industrial		631		-		-		-		-		-		-		631		7
Office		1,226		-		-		-		-		-		-		1,226		-
Retail		1,375		11		-		-		-		-		-		1,385		19
Other commercial		256		38		-		-		-		-		-		294		2
Residential		16		26,384		-		176		1		-		-		26,578		343
At December 31		6,951		26,434		-		176		1		-		-		33,562		379
¹ Includes investments of Holding and other activities.

Summary of Income Received From Investments in RMBSs, SMBSs and ABSs


						Total income 2018		December 31, 2018
2018	Interest income		Total gains and losses on sale of assets			Total		Investments
Residential mortgage-backed securities		140		(3	)		137		2,585
Commercial mortgage-backed securities		139		(41	)		98		4,013
Asset-backed securities		54		-			54		2,447
ABSs – Other		84		15			99		2,552
Total		417		(28	)		389		11,596

						Total income 2017		December 31, 2017
2017	Interest income		Total gains and losses on sale of assets			Total		Investments
Residential mortgage-backed securities		174		95			269		3,655
Commercial mortgage-backed securities		159		53			212		4,086
Asset-backed securities		56		26			82		2,327
ABSs – Other		87		71			158		2,378
Total		476		245			721		12,446

Summary of Amortized Cost and Fair Value of Debt Securities

The amortized cost and fair value of debt securities, money market investments and other, included in Aegon’s available-for-sale (AFS) portfolios, are as follows as of December 31, 2018, and December 31, 2017


2018	Amortized cost		Unrealized gains		Unrealized losses			Total fair value		Fair value of instruments with unrealized gains		Fair value of instruments with unrealized losses
Debt securities, money market instruments and other
United States government		6,973		603		(127	)		7,449		4,772		2,676
Dutch government		4,908		1,136		(3	)		6,040		6,002		38
Other government		11,293		718		(54	)		11,957		11,105		852
Mortgage-backed securities		6,275		366		(84	)		6,557		3,700		2,857
Asset-backed securities		4,948		65		(55	)		4,958		1,825		3,133
Corporate		39,770		1,748		(1,138	)		40,379		21,441		18,939
Money market investments		5,955		-		-			5,955		5,701		254
Other		919		71		(88	)		902		707		194
Total		81,039		4,707		(1,550	)		84,196		55,253		28,943

Of which held by Aegon Americas and NL		72,486		4,370		(1,352	)		75,504		50,976		24,528

2017	Amortized cost		Unrealized gains		Unrealized losses			Total fair value		Fair value of instruments with unrealized gains		Fair value of instruments with unrealized losses
Debt securities, money market instruments and other
United States government		8,011		936		(101	)		8,846		6,805		2,041
Dutch government		4,799		992		(11	)		5,781		4,885		896
Other government		11,746		838		(17	)		12,568		11,501		1,067
Mortgage-backed securities		7,326		424		(56	)		7,694		5,569		2,126
Asset-backed securities		4,624		92		(17	)		4,698		3,878		820
Corporate		37,168		3,663		(218	)		40,613		34,945		5,668
Money market investments		6,690		-		-			6,690		5,642		1,048
Other		765		98		(73	)		791		597		193
Total		81,130		7,043		(493	)		87,681		73,822		13,858

Of which held by Aegon Americas and NL		72,937		6,392		(462	)		78,867		66,688		12,179

Summary of Composition by Industry Category of Available-for-Sale (AFS) Debt Securities, Money Market Investments and Other in an Unrealized Loss Position

The composition by industry category of Aegon’s available-for-sale (AFS) debt securities, money market investments and other in an unrealized loss position at December 31, 2018, and December 31, 2017, is presented in the following table:


	December 31, 2018					December 31, 2017
Unrealized losses – debt securities, money market investments and other	Carrying value of instruments with unrealized losses		Unrealized losses			Carrying value of instruments with unrealized losses		Unrealized losses
Residential mortgage-backed securities (RMBSs)		446		(30	)		732		(30)
Commercial mortgage-backed securities (CMBSs)		2,012		(45	)		1,140		(22)
Asset-backed securities (ABSs) – CDOs backed by
ABS, Corp. bonds, Bank loans		2,088		(42	)		87		(2)
ABSs – Other		829		(10	)		603		(13)
Financial Industry – Banking		2,522		(106	)		663		(39)
Financial Industry – Insurance		646		(36	)		231		(7)
Financial Industry – Other		1,523		(69	)		1,411		(10)
Industrial		10,073		(684	)		3,305		(131)
Utility		1,258		(78	)		375		(14)
Government		2,935		(164	)		3,438		(122)
Other		194		(88	)		193		(73)
Total held by Aegon Americas and NL		24,528		(1,352	)		12,179		(462)
Held by other segments		4,415		(197	)		1,680		(31)
Total		28,943		(1,550	)		13,858		(493)

Summary of Breakdown of RMBS Available-for-Sale (AFS) Portfolio

The following table shows the breakdown of Aegon America’s RMBS available-for-sale (AFS) portfolio.


AFS RMBS by quality	AAA		AA		A		BBB		<BBB		Total amortized cost		Total fair value
GSE guaranteed		450		149		-		-		-		599		599
Prime jumbo		-		16		1		5		98		120		124
Alt-A		-		59		17		5		221		301		397
Negative amortization floaters		-		1		-		11		438		450		533
Other housing		-		13		4		16		333		366		450
At December 31, 2018		450		238		22		36		1,089		1,836		2,102

Of which insured		-		-		20		5		99		124		113

AFS RMBS by quality	AAA		AA		A		BBB		<BBB		Total amortized cost		Total fair value
GSE guaranteed		1,025		270		-		-		-		1,295		1,298
Prime jumbo		-		-		-		5		124		130		136
Alt-A		-		33		20		8		277		337		437
Negative amortization floaters		-		-		-		-		502		502		584
Other housing		-		9		17		30		397		453		530
At December 31, 2017		1,025		312		37		43		1,300		2,717		2,985

Of which insured		-		-		24		5		146		175		166

Summary of Credit Quality of Available-For-Sale (AFS) CMBS Portfolio

The tables below summarize the credit quality of Aegon Americas’ available-for-sale (AFS) CMBS portfolio. Additionally, as of December 31, 2018, Aegon Americas has no investments in CMBS (December 31, 2017: EUR nil), which are classified as fair value through profit or loss.


CMBS by quality	AAA		AA		A		BBB		<BBB		Total amortized cost		Total fair value
CMBS		2,635		567		65		3		57		3,326		3,310
CMBS and CRE CDOs		-		-		-		-		5		5		4
At December 31, 2018		2,635		567		65		3		62		3,331		3,314

CMBS by quality	AAA		AA		A		BBB		<BBB		Total amortized cost		Total fair value
CMBS		2,626		559		63		3		84		3,335		3,372
CMBS and CRE CDOs		-		-		-		-		4		4		3
At December 31, 2017		2,626		559		63		3		88		3,339		3,375

Summary of Breakdown of Quality of Available-for-Sale (AFS) ABS Portfolio

The breakdown by quality of the available-for-sale (AFS) ABS portfolio of Aegon Americas and Aegon the Netherlands is as follows:


ABS US and NL	AAA		AA		A		BBB		<BBB		Total amortized cost		Total fair value
Credit cards		174		19		-		-		-		193		201
Autos		230		-		58		2		-		290		289
Small business loans		-		-		2		12		46		60		63
CDOs backed by ABS, Corp. bonds, Bank loans		1,535		479		216		146		46		2,423		2,386
Other ABS		525		151		774		88		8		1,547		1,563
At December 31, 2018		2,464		649		1,051		248		100		4,512		4,503

ABS US and NL	AAA		AA		A		BBB		<BBB		Total amortized cost		Total fair value
Credit cards		170		19		-		30		-		219		229
Autos		226		-		64		2		-		292		292
Small business loans		-		-		3		6		62		70		74
CDOs backed by ABS, Corp. bonds, Bank loans		1,467		407		224		120		46		2,265		2,281
Other ABS		494		76		683		81		1		1,336		1,350
At December 31, 2017		2,357		503		975		238		109		4,182		4,226

Summary of Composition by Maturity of all Available-for-Sale Debt Securities in an Unrealized Loss Position

The table below shows the composition by maturity of all available-for-sale debt securities in an unrealized loss position held by Aegon Americas and Aegon the Netherlands.


	December 31, 2018					December 31, 2017
Debt securities	Carrying value of securities with gross unrealized losses		Gross unrealized losses			Carrying value of securities with gross unrealized losses		Gross unrealized losses
Debt securities	Carrying value of securities with gross unrealized losses		Gross unrealized losses			Carrying value of securities with gross unrealized losses		Gross unrealized losses
One year or less		643		(18	)		442		(6	)
Over 1 through 5 years		5,545		(120	)		1,784		(31	)
Over 5 through 10 years		9,575		(446	)		4,517		(95	)
Over 10 years		8,317		(680	)		4,194		(258	)
Total		24,080		(1,264	)		10,937		(389	)

Summary of Composition by Credit Quality of Debt Securities, Available-for-Sale, in an Unrealized Loss Position

The table below shows the composition by credit quality of debt securities, available-for-sale, in an unrealized loss position held by Aegon Americas and Aegon the Netherlands.
	December 31, 2018					December 31, 2017
Debt securities	Carrying value of securities with unrealized losses		Unrealized losses			Carrying value of securities with unrealized losses		Unrealized losses
Debt securities	Carrying value of securities with unrealized losses		Unrealized losses			Carrying value of securities with unrealized losses		Unrealized losses
AAA		6,318		(186	)		4,924		(135	)
AA		1,468		(48	)		753		(16	)
A		5,345		(181	)		1,750		(44	)
BBB		8,881		(578	)		2,339		(70	)
BB		920		(90	)		507		(39	)
B		742		(87	)		323		(32	)
Below B		407		(95	)		341		(54	)
Total		24,080		(1,264	)		10,937		(389	)

Summary of Available-for-Sale Debt Securities With Unrealized Losses by Investment and Length of Time Individual Securities

The table below provides the length of time an available-for-sale security has been below cost and the respective unrealized loss.
			At December 31, 2018
Debt securities	Investment grade carrying value of securities with unrealized losses		Below investment grade carrying value of securities with unrealized losses		Investment grade unrealized loss			Below investment grade unrealized loss
Debt securities					Investment grade unrealized loss			Below investment grade unrealized loss
0 – 6 months		8,354		977		(227	)		(58	)
6 – 12 months		9,976		609		(504	)		(96	)
> 12 months		3,681		483		(261	)		(119	)
Total		22,012		2,069		(992	)		(272	)

			At December 31, 2017
Debt securities	Investment grade carrying value of securities with unrealized losses		Below investment grade carrying value of securities with unrealized losses		Investment grade unrealized loss			Below investment grade unrealized loss
Debt securities					Investment grade unrealized loss			Below investment grade unrealized loss
0 – 6 months		4,051		485		(45	)		(15	)
6 – 12 months		1,391		62		(9	)		(5	)
> 12 months		4,324		624		(211	)		(105	)
Total		9,766		1,171		(264	)		(125	)

The unrealized loss increased during 2018 due mainly to widening credit spreads and increasing US Treasury rates.

Aging and severity unrealized losses

The table below provides the length of time a below investment grade security has been in an unrealized loss and the percentage of carrying value (CV) to amortized cost in Aegon Americas and Aegon the Netherlands.


			2018					2017
Aging and severity unrealized losses debt securities	Carrying value		Unrealized losses			Carrying value		Unrealized losses
CV 70-100% of amortized cost		970		(53	)		482		(13	)
CV 40-70% of amortized cost		7		(5	)		3		(2	)
CV < 40% of amortized cost		-		-			-		-
0-6 months		977		(58	)		485		(15	)

CV 70-100% of amortized cost		577		(76	)		62		(5	)
CV 40-70% of amortized cost		31		(18	)		-		-
CV < 40% of amortized cost		-		(1	)		-		-
6-12 months		609		(96	)		62		(5	)

CV 70-100% of amortized cost		143		(21	)		67		(10	)
CV 40-70% of amortized cost		8		(5	)		8		(4	)
CV < 40% of amortized cost		1		(2	)		-		-
12-24 months		151		(28	)		75		(13	)

CV 70-100% of amortized cost		265		(34	)		511		(63	)
CV 40-70% of amortized cost		58		(43	)		30		(16	)
CV < 40% of amortized cost		8		(13	)		8		(12	)
> 24 months		331		(90	)		549		(92	)
> 24 months		331		(90	)		549		(92	)
Total		2,069		(272	)		1,171		(125	)

Summary of Realized Gains and Losses on Debt Securities

The following table provides the realized gains and losses on the debt securities of Aegon Americas and Aegon the Netherlands for the twelve months ended December 31, 2018, and December 31, 2017.


Gross realized gains and (losses)	Gross realized gains		Gross realized losses
December 31, 2018
Debt securities		156		(378	)
December 31, 2017
Debt securities		1,813		(171	)

Summary of Length of Time Security and Respective Realized Loss

The table below provides the length of time the security was below cost prior to the sale and the respective realized loss for assets not considered impaired.


	Gross realized losses
	0 - 12 months			>12 months			Total
December 31, 2018
Debt securities		(145	)		(233	)		(378	)

December 31, 2017
Debt securities		(137	)		(35	)		(171	)

Summary of Composition of Impairment Losses and Recoveries

The composition of Aegon Americas and Aegon the Netherlands’ bond impairment losses and recoveries by issuer for the periods ended December 31, 2018, and December 31, 2017, is presented in the table below. Those issuers with impairments or recoveries above EUR 25 million are specifically noted.


	2018			2017
	(Impairment)/recovery			(Impairment)/recovery
Impairments:
Other (none individually greater than EUR 25 million)		(24	)		(16	)
Subtotal		(24	)		(16	)

Recoveries:
Total recoveries		34			16
Sub-total		34			16
Net (impairments) and recoveries		10			-

Summary of Financial Assets that are Either Past Due or Impaired


			2018								2017
Past due but not impaired assets	0-6 months		6-12 months		> 1 year		Total		0-6 months		6-12 months		> 1 year		Total
Debt securities – carried at fair value		108		121		48		277		49		14		28		91
Mortgage loans		192		22		2		215		111		2		4		117
Other loans		41		2		2		45		31		1		3		35
Accrued interest		3		3		-		6		-		1		1		1
At December 31		344		148		52		544		191		18		35		244


Impaired financial assets	Carrying amount 2018		Carrying amount 2017
Shares		33		48
Debt securities – carried at fair value		1,085		1,063
Mortgage loans		122		262
Private Loans		-		-
Other loans		3		3
Other financial assets – carried at fair value		5		6
At December 31		1,247		1,381

Summary of Unrealized Gains and Losses on Share Positions

The table below represents the unrealized gains and losses on share positions held by Aegon Americas and Aegon the Netherlands.


	Cost basis		Carrying value		Net unrealized gains/(losses)		Carrying value of securities with gross unrealized gains		Gross unrealized gains		Carrying value of securities with gross unrealized losses		Gross unrealized losses
December 31, 2018
Shares		371		391		20		304		40		86		(20	)
December 31, 2017
Shares		385		433		48		400		62		34		(13	)

Summary of Composition of Shares by Industry Sector in Unrealized Loss Position

The composition of shares by industry sector in an unrealized loss position held by Aegon Americas and Aegon the Netherlands at December 31, 2018, and December 31, 2017 is presented in the following table.


	2018					2017
Unrealized losses on shares	Carrying value of instruments with unrealized losses		Unrealized losses			Carrying value of instruments with unrealized losses		Unrealized losses
Unrealized losses on shares	Carrying value of instruments with unrealized losses		Unrealized losses			Carrying value of instruments with unrealized losses		Unrealized losses
Financials		49		(15	)		19		(12	)
Other		37		(6	)		14		(2	)
Total		86		(20	)		34		(13	)

Summary of Shares Cost Prior to Impairment

The table below provides the length of time the shares held by Aegon Americas and Aegon the Netherlands were below cost prior to their impairment in 2018 and 2017.


In million EUR	0- 6 months
2018
Shares		(5	)
2017
Shares		-

Summary of General Account Equity Real Estate and Other Non-fixed-income Portfolio

The general account equity, real estate and other non-fixed-income portfolio of Aegon is as follows:


Equity, real estate and non-fixed income exposure	Americas		The Netherlands		United Kingdom		Central & Eastern Europe		Spain & Portugal		Asia		Asset Manage- ment		Holding and other activities		Total 2018
Equity, real estate and non-fixed income exposure	Americas		The Netherlands		United Kingdom		Central & Eastern Europe		Spain & Portugal		Asia		Asset Manage- ment		Holding and other activities		Total 2018
Equity funds		141		196		-		63		-		-		-		-		401
Common shares ¹		203		-		3		2		3		7		1		66		287
Preferred shares		187		-		-		-		-		-		-		46		233
Investments in real estate		530		2,150		-		4		17		-		-		-		2,700
Hedge funds		678		1		-		-		-		-		2		-		681
Other alternative investments		1,206		438		-		-		-		-		-		22		1,666
Other financial assets		555		832		1,046		2		7		-		1		-		2,443
At December 31		3,501		3,617		1,050		71		27		7		5		134		8,412
¹ Common shares in Holding and other activities includes the elimination of treasury shares in the general account for an amount of EUR nil million.
Equity, real estate and non-fixed income exposure	Americas		The Netherlands		United Kingdom		Central & Eastern Europe		Spain & Portugal		Asia		Asset Manage- ment		Holding and other activities		Total 2017
Equity, real estate and non-fixed income exposure	Americas		The Netherlands		United Kingdom		Central & Eastern Europe		Spain & Portugal		Asia		Asset Manage- ment		Holding and other activities		Total 2017
Equity funds		142		161		-		47		-		-		-		-		351
Common shares ¹		232		-		5		8		4		1		-		40		290
Preferred shares		192		-		-		-		-		-		-		-		192
Investments in real estate		633		1,495		-		4		15		-		-		-		2,147
Hedge funds		688		1		-		-		-		-		2		-		691
Other alternative investments		1,122		309		-		-		-		-		-		18		1,448
Other financial assets		556		410		194		2		2		-		1		-		1,165
At December 31		3,566		2,375		199		62		20		1		4		57		6,284
¹ Common shares in Holding and other activities includes the elimination of treasury shares in the general account for an amount of EUR nil million.

Summary of Market Risk Concentrations in Shares


Market risk concentrations – shares	Americas		The Netherlands		United Kingdom		Central & Eastern Europe		Spain & Portugal		Asia		Asset Manage- ment		Total 2018 ¹		Of which impaired assets
Market risk concentrations – shares	Americas		The Netherlands		United Kingdom		Central & Eastern Europe		Spain & Portugal		Asia		Asset Manage- ment		Total 2018 ¹		Of which impaired assets
Communication		26		-		-		-		-		-		-		32		-
Consumer		6		-		-		-		-		-		-		7		-
Financials		466		3		-		-		3		7		-		491		3
Funds		-		1,410		3		62		7		-		-		1,558		26
Industries		19		-		-		-		-		-		-		19		-
Other		15		-		-		2		-		-		4		54		3
At December 31		532		1,412		3		64		10		7		4		2,161		33
¹ Includes investments of Holding and other activities.

Market risk concentrations – shares	Americas		The Netherlands		United Kingdom		Central & Eastern Europe		Spain & Portugal		Asia		Asset Manage- ment		Total 2017 ¹		Of which impaired assets
Market risk concentrations – shares	Americas		The Netherlands		United Kingdom		Central & Eastern Europe		Spain & Portugal		Asia		Asset Manage- ment		Total 2017 ¹		Of which impaired assets
Communication		28		-		-		-		-		-		-		28		-
Consumer		8		-		-		-		-		-		-		8		-
Financials		491		3		1		-		3		1		-		499		1
Funds		-		852		4		53		2		-		-		968		43
Industries		19		-		-		-		-		-		-		19		-
Other		22		4		-		2		-		-		2		30		4
At December 31		567		859		5		54		5		1		2		1,551		48
¹ Includes investments of Holding and other activities.

Summary of Closing Levels of Certain Major Indices

The table that follows sets forth the closing levels of certain major indices at the end of the last five years.


	2018		2017		2016		2015		2014
S&P 500		2,507		2,674		2,239		2,044		2,059
Nasdaq		6,635		6,903		5,383		5,007		4,736
FTSE 100		6,728		7,688		7,143		6,242		6,566
AEX		488		545		483		442		424

Summary of Sensitivity Analysis of Net Income and Shareholders' Equity to Equity Markets


Sensitivity analysis of net income and shareholders’ equity to equity markets Immediate change of	Estimated approximate effects on net income			Estimated approximate effects on shareholders’ equity
2018
Equity increase 10%		293			405
Equity decrease 10%		(273	)		(379	)
Equity increase 20%		652			877
Equity decrease 20%		(393	)		(599	)

2017
Equity increase 10%		317			405
Equity decrease 10%		(316	)		(405	)
Equity increase 20%		647			820
Equity decrease 20%		(660	)		(839	)

Schedule of Interest Rate

The following table shows interest rates at the end of each of the last five years.


	2018			2017			2016			2015			2014
3-month US LIBOR		2.81	%		1.69	%		1.00	%		0.61	%		0.26	%
3-month EURIBOR		(0.31	%)		(0.33	%)		(0.32	%)		(0.13	%)		0.08	%
10-year US Treasury		2.69	%		2.41	%		2.43	%		2.27	%		2.17	%
10-year Dutch government		0.39	%		0.53	%		0.35	%		0.79	%		0.68	%

Schedule of Parallel Movement of Yield Curve


Parallel movement of yield curve	Estimated approximate effects on net income			Estimated approximate effects on shareholders’ equity
Parallel movement of yield curve	Estimated approximate effects on net income			Estimated approximate effects on shareholders’ equity
2018
Shift up 100 basis points		(677	)		(3,892	)
Shift down 100 basis points		1,188			2,819

2017
Shift up 100 basis points		(282	)		(2,620	)
Shift down 100 basis points		200			2,160

Summary of Information on Three Year Historical Net Income (Loss) and Shareholders' Equity

Information on Aegon’s three year historical net income/(loss) and shareholders’ equity in functional currency are shown in the table below:


	2018			2017			2016
Net income
Americas (in USD)		61			1,762			618
The Netherlands (in EUR)		648			818			418
United Kingdom (in GBP)		35			71			(346	)
Central & Eastern Europe (in EUR)		60			57			19
Spain & Portugal (in EUR)		(3	)		(2	)		(2	)
Asia (in USD)		13			6			(14	)
Asset Management (in EUR)		105			48			97

Equity in functional currency
Americas (in USD)		15,239			17,712			17,103
The Netherlands (in EUR)		6,967			6,558			5,101
United Kingdom (in GBP)		1,671			1,905			1,845
Central & Eastern Europe (in EUR)		377			402			378
Spain & Portugal (in EUR)		427			433			451
Asia (in USD)		862			1,169			1,281
Asset Management (in EUR)		471			397			422

Summary of Exchange Rates of US Dollar and UK Pound per Euro

The exchange rates for US dollar and UK pound per euro for each of the last five year ends are set forth in the table below:


Closing rates	2018		2017		2016		2015		2014
USD		1.14		1.20		1.05		1.09		1.21
GBP		0.90		0.89		0.85		0.74		0.78

Schedule of Sensitivity Analysis of Net Income and Shareholders' Equity

Sensitivity analysis of net income and shareholders’ equity to translation risk


Movement of currency exchange rates ¹	Estimated approximate effects on net income			Estimated approximate effects on shareholders’ equity
Movement of currency exchange rates ¹	Estimated approximate effects on net income			Estimated approximate effects on shareholders’ equity
2018
Increase by 15% of USD currencies relative to the euro		1			1,909
Increase by 15% of GBP currencies relative to the euro		4			269
Increase by 15% of non-euro currencies relative to the euro		20			2,301
Decrease by 15% of USD currencies relative to the euro		3			(1,389	)
Decrease by 15% of GBP currencies relative to the euro		(2	)		(179	)
Decrease by 15% of non-euro currencies relative to the euro		(9	)		(1,659	)

2017
Increase by 15% of USD currencies relative to the euro		260			2,159
Increase by 15% of GBP currencies relative to the euro		21			321
Increase by 15% of non-euro currencies relative to the euro		265			2,598
Decrease by 15% of USD currencies relative to the euro		(189	)		(1,566	)
Decrease by 15% of GBP currencies relative to the euro		(16	)		(216	)
Decrease by 15% of non-euro currencies relative to the euro		(184	)		(1,868	)

¹	The effect of currency exchange movements is reflected as a one-time shift up or down in the value of the non-euro currencies relative to the euro on December 31.

Summary of Maturity Analysis Gross Undiscounted Contractual Cash Flows

Maturity analysis – gross undiscounted contractual cash flows (for non-derivatives)	On demand		< 1 yr amount		1 < 5 yrs amount		5 < 10 yrs amount		> 10 yrs amount		Total amount
	On demand		< 1 yr amount		1 < 5 yrs amount		5 < 10 yrs amount		> 10 yrs amount		Total amount
2018
Trust pass-through securities		-		9		36		110		69		223
Subordinated loans		-		66		266		201		1,400		1,933
Borrowings		-		1,713		8,136		1,499		2,825		14,174
Investment contracts ¹		13,305		1,439		1,831		985		1,517		19,077
Investment contracts for account of policyholders ¹		29,360		19,670		20		26		91		49,166
Other financial liabilities		5,849		2,445		81		45		38		8,457
Total financial liabilities (excluding investment/insurance contracts)		5,849		4,234		8,519		1,854		4,332		24,787
		5,849		4,234		8,519		1,854		4,332		24,787
2017
Trust pass-through securities		-		9		34		110		68		221
Subordinated loans		-		28		112		56		1,137		1,333
Borrowings		-		1,888		8,396		2,411		2,668		15,362
Investment contracts ¹		12,189		1,381		1,591		577		1,709		17,448
Investment contracts for account of policyholders ¹		33,738		2,605		1		1		133		36,478
Other financial liabilities		6,277		2,002		791		23		32		9,125
Total financial liabilities (excluding investment/insurance contracts)		6,277		3,926		9,333		2,599		3,905		26,041

¹	Excluding investment contracts with discretionary participating features.

Summary of Financial Liabilities Relating to Insurance and Investment Contracts

The cash benefit payments are presented on an undiscounted basis and are before deduction of tax and before reinsurance.


Financial liabilities relating to insurance and investment contracts ¹	On demand		< 1 yr amount		1 < 5 yrs amount		5 < 10 yrs amount		> 10 yrs amount		Total amount
2018
Insurance contracts		-		5,255		17,147		17,891		126,514		166,807
Insurance contracts for account of policyholders		-		8,382		35,238		36,455		130,475		210,550
Investment contracts		-		6,679		6,985		2,739		5,087		21,490
Investment contracts for account of policyholders		169		8,839		23,185		28,747		64,185		125,125
		169		29,155		82,556		85,831		326,261		523,972
2017
Insurance contracts		-		3,865		16,348		17,155		122,702		160,070
Insurance contracts for account of policyholders		-		8,122		33,916		35,391		123,911		201,339
Investment contracts		-		5,961		6,870		2,510		4,620		19,960
Investment contracts for account of policyholders		234		10,117		23,871		21,202		54,930		110,353
		234		28,064		81,005		76,258		306,162		491,723

The liability amount in the consolidated financial statements reflects the discounting for interest as well as adjustments for the timing of other factors as described above. As a result, the sum of the cash benefit payments shown for all years in the table exceeds the corresponding liability amounts included in notes 36 Insurance contracts and 37 Investments contracts.

Summary Of Maturity Analysis For Derivative Financial Instruments

The following table details the Group’s liquidity analysis for its derivative financial instruments, based on the undiscounted contractual net cash inflows and outflows on derivative instruments that settle on a net basis, and the undiscounted gross inflows and outflows on those derivatives that require gross settlement.


Maturity analysis relating to derivatives ¹ (Contractual cash flows)	On demand		< 1 yr amount			1 < 5 yrs amount			5 < 10 yrs amount			> 10 yrs amount			Total amount
2018
Gross settled
Cash inflows		-		23,453			8,092			11,323			21,233			64,101
Cash outflows		-		(23,143	)		(7,351	)		(10,832	)		(20,816	)		(62,141	)

Net settled
Cash inflows		-		156			709			982			2,230			4,078
Cash outflows		-		(66	)		(288	)		(516	)		(5,743	)		(6,614	)
2017
Gross settled
Cash inflows		-		14,646			7,024			10,658			18,916			51,245
Cash outflows		-		(14,766	)		(6,367	)		(9,890	)		(18,447	)		(49,471	)

Net settled
Cash inflows		-		129			783			1,033			2,428			4,374
Cash outflows		-		(67	)		(332	)		(543	)		(5,870	)		(6,812	)

Derivatives includes all financial derivatives regardless whether they have a positive or a negative value. It does not include bifurcated embedded derivatives. These are presented together with the host contract. For interest rate derivatives only, cash flows related to the pay leg are taken into account for determining the gross undiscounted cash flows.

Life insurance general account [member]

Statement [LineItems]

Summary of Financial Liabilities Relating to Insurance and Investment Contracts


Movements during the year in reinsurance assets relating to life insurance:	Life insurance general account			Life insurance for account of policyholders			Total life insurance
At January 1, 2018		17,419			2			17,421
Gross premium and deposits – existing and new business		2,038			3			2,041
Unwind of discount/interest credited		860			-			860
Insurance liabilities released		(2,518	)		(3	)		(2,521	)
Fund charges released		(82	)		-			(82	)
Changes to valuation of expected future benefits		109			-			109
Policy transfers		25			-			25
Net exchange differences		858			-			858
Transfers to disposal groups		-			-			-
Transfer to/from insurance contract		-			-			-
Other movements		2			-			2
At December 31, 2018		18,712			2			18,714

At January 1, 2017		9,714			2			9,716
Gross premium and deposits – existing and new business		11,326			6			11,332
Unwind of discount/interest credited		533			-			533
Insurance liabilities released		(2,877	)		(3	)		(2,880	)
Fund charges released		(49	)		-			(49	)
Changes to valuation of expected future benefits		823			-			823
Policy transfers		(38	)		-			(38	)
Net exchange differences		(1,698	)		-			(1,697	)
Transfers to disposal groups		(239	)		(3	)		(242	)
Transfer to/from insurance contract		23			-			23
Other movements		(97	)		-			(97	)
At December 31, 2017		17,419			2			17,421

Non-life insurance [member]

Statement [LineItems]

Summary of Financial Liabilities Relating to Insurance and Investment Contracts

Movements during the year in reinsurance assets relating to non-life insurance:	2018			2017
At January 1		1,327			1,481
Gross premium and deposits – existing and new business		84			99
Unwind of discount/interest credited		84			89
Insurance liabilities released		(123	)		(129	)
Changes to valuation of expected future benefits		-			28
Changes in unearned premiums		(28	)		(42	)
Incurred related to current year		77			85
Incurred related to prior years		36			37
Release for claims settled current year		(18	)		(19	)
Release for claims settled prior years		(130	)		(119	)
Change in IBNR		12			(8	)
Shadow accounting adjustment		(24	)		6
Net exchange differences		65			(180	)
Portfolio transfers and acquisitions		-			2
Other movements		(8	)		(4	)
At December 31		1,356			1,327

Financial assets at amortised cost, class [member]

Statement [LineItems]

Summary of Credit Risk Rating Grades

The table below details the credit risk rating grades, as of December 31, 2018, for financial assets with cash flows that are SPPI, excluding any financial assets that meet the definition of held for trading in IFRS 9, or that are managed and whose performance is evaluated on a fair value basis. The tables show the carrying value of those financial assets applying IAS 39 (in the case of financial assets measured at amortized cost, before adjusting for any impairment allowances).


SPPI compliant financial assets at carrying value	AAA		AA		A		BBB		BB		B		CCC or lower		Not Rated		Total
Shares – Carried at fair value		-		-		-		42		9		17		-		-		68
Debt securities – Carried at fair value		25,637		9,224		17,057		20,330		1,480		1,159		1,395		-		76,283
Money market and other short-term investments- carried at fair value		55		158		2,561		351		-		-		-		-		3,126
Mortgage loans– Carried at amortized cost		941		3,204		3,567		266		15		-		-		28,647		36,639
Private loans – Carried at amortized cost		1,611		83		261		924		52		-		-		1,136		4,068
Other financial assets – Carried at fair value		-		-		64		12		44		61		1		70		252
At December 31		28,244		12,670		23,510		21,925		1,601		1,237		1,396		29,853		120,436