a.s.r. operates in the residential mortgage market and provides mortgage loans to retail customers for its own account and external investors. The mortgage loans for the a.s.r. brand are issued by ASR Levensverzekering N.V. and for the Aegon brand by Aegon Hypotheken B.V. and Aegon Levensverzekering N.V.

Market

After turbulent market conditions in recent years, the market has cooled down. Mortgage interest rates have stabilised at around 4 - 4.5% after the sharp increase in 2022 and market volumes have returned to normal levels. While mortgage applications from first time buyers have remained relatively stable compared to previous years, applications for refinancing have dropped significantly on the back of higher mortgage rates.

Nonetheless, the shortage in the Dutch housing market remains severe. Combined with sharply increased wages (which improves borrowing capacity), this led to improvements in housing price developments in the second half of 2023.

Products

a.s.r. offers its mortgage products via intermediaries to its customers through two different mortgage brands; the a.s.r. and the Aegon NL brand. Under the Aegon NL brand, standard products (annuity, linear and interest-only mortgages) are offered to a broad customer base. In addition to standard products, the a.s.r. brand offers specialised products for distinct customer types. This includes products for first-time buyers, sustainable home modifications, and senior citizens.

The Aegon NL-branded products will be integrated with the a.s.r.-branded products during the integration period, in which the best elements of both products will be used for future product offering.

Strategy and achievements

a.s.r. is focused on integrating its mortgage businesses with the ambition to become a leading sustainable mortgage company in the Netherlands. The business model of a.s.r. in which mortgages are used as an attractive investment for a.s.r.’s own account as well as for external investors, will remain in place.

The geopolitical situation and interest rate volatility have impacted the investor appetite for mortgages, leading to lower production volumes. Meanwhile, the level of arrears in the mortgage portfolio remains on a very low level.

For the second year in a row, a.s.r. won the Green Lotus award. This award recognises the mortgage lender that has been the most progressive in terms of residential sustainability in the broadest sense of the word, in the view of intermediary firms and an independent jury. An important element of this award is a.s.r.’s sustainability mortgage, which offers both existing and new clients the opportunity to take out an (additional) mortgage loan for sustainable improvements.

The NPS-c measures customers satisfaction during contact moments, please refer to the result in the graph.

Outlook for 2024

In 2024, a.s.r. expects a stabilising mortgage market due to a limited number of permits granted for new-build housing and a continuing low refinancing market. In this stabilising mortgage market, a.s.r. aims to at least maintain its market share. The mortgage businesses of a.s.r. will be further integrated, while service levels to customers remain intact. Additionally, a.s.r. is continuously investigating ways to make it easier for customers to make their homes more sustainable, so as to increase its impact on the energy transition. The recent revision of mortgage affordability tables, in which the energy performance of buildings is taken into consideration, is likely to affect housing price developments and boost the energy transition. Over time, ecological considerations (incl. climate risks) are expected to become a more important factor in the Dutch housing and mortgage market.