Aegon UK to shut tied pensions advice unit; Extra 116 jobs to go

Aegon is to close its UK-based tied advisory service Aegon Direct as it progresses with a restructure designed to cut costs across the group by 25% by the end of the year.

Aegon said it will wind down the business, which, until last year, offered tied advice on both conventional and enhanced annuities but now offers whole of market guidance on the conventional products, by the end of the year.

It said it believes the capital required to run the unit can be better redeployed in other areas to provide a greater return for shareholders.

Meanwhile, the group has announced it is putting in place new structures in its customer services and finance areas as a result of investment in technology and streamlining of operations, with the loss of more than 100 jobs.

The legal and sales areas will also be streamlined to reflect the refocus of the business on its two growth markets of ‘at retirement' and workplace savings.

The moves will lead to a reduction of 116 roles in the life and pensions business. This includes a reduction of 17 roles in affinity group Aegon Direct.

Aegon said it will seek to minimise compulsory redundancies where possible and is also seeking to meet its cost saving targets by looking at alternative savings.

Aegon aims to reduce its operating costs by 25% by end 2011 and refocus the business on its growth markets. The company had met £58m of the annualised £80m cost saving target by the end of June 2011.

AEGON UK chief executive Adrian Grace (pictured) said: "All of the decisions we've taken over the last 12 months have taken us closer to delivering our restructuring plans and positioning Aegon for success in its chosen markets. We will continue to look at all cost saving opportunities to meet our target by end 2011."