40 Market positions CEE Spain France China # 2 Life in Hungary # 4 Non-life in Hungary # 5 Unit-linked in Poland # 10 Life insurance # 9 Foreign-owned life insurers # 7 Life insurance Over vie w  Net income AE GON’ s operations in Ne Markets reported higher  underlying e arnings in 2010 Higher contributions from  Spain and France, Variable Annuitie s Europe and the  first -time inclusion of AEGON As set Management were  partly o ffset by lower earnings fr om Central & Eastern  Europe and higher losses from continued investments in  the c omp any’s operations in Asia. Although still  negativ e, net results from AE GON’s Asian operations  impro ved considerably comp ared to the previous year,  which included a charge relat ed to the sale of the  comp an y’s activities in Taiw an. In 2010, asset management and administration fees were  reduced, due to new pension legislation in Hungary.  Assets have been transferred to the Hungarian State  during the first quarter of 2011. In Poland, the government  has announced plans to reduce contributions to private  pension funds. AEGON expects these measures to have  an impact on underlying earnings of approximately  EUR 25 million in 2011.  In 2010, New Markets turned a net profit of EUR 91 million.  A loss was reported in 2009 due to a one-off charge  related to the sale of the company’s life insurance  activities in Taiwan. Net income in 2010 included charges  related to the Hungarian pension legislation changes  of EUR 23 million and EUR 19 million related to bank tax  in Hungary.  Underlying e arnings before tax from New Markets  incre as ed 18% compared with 2009 to EUR 200 million.  The incr ease was driven b a higher contribution from  Spain and France and Variable Annuities Europe, as well  as the inclusion of AEGON As set Management, which  added EUR 46 million in e arnings t o New Markets.  E arnings fr om Central & East ern Europe decreased,  while in Asia losses were  higher as a result of continued  inves tment s in growth o the business.  Operating expenses increased to EUR 562 million for  2010, as compared to EUR 227 million in 2009. The  increase was mainly due to the inclusion of AEGON  Asset Management and restructuring charges.  Operating expenses Underlying e arnings bef or e tax Sales and deposits New life sales during 2010 declined 4% compared with  the previous year to EUR 275 million. Growth in Central  & Eastern Europe - and to a lesser extent Asia - was  more than offset by a decline in Spain. Strong single- premium production in the bank channel in Poland,  continued growth in Hungary and a successful shift from  pensions to life insurance in Turkey contributed to the  26% growth in new life sales in Central & Eastern Europe.  Sales in Asia increased 6% as a result of growth in both  China and India, while the decrease in Spain was mainly  due to lower sales from AEGON’s partnership with CAM. In C entr al & Eastern Europe the life and pensions  oper ations performed in-line with 2009. However, the  non-lif e business reported low er earnings due to higher  claims r elating to storms and floods in Hungary.  AE GON’ s operations in Asia r ecorded a loss of EUR 39  million as a result of continued in vestments in the  comp an y’s joint venture in China, India and Japan.  E arnings fr om Spain and Fr anc e increased due to a  higher c ontribution from La Mondiale Participations,  AE GON’ s associate in France.  V ariable Annuities Europe t urned to profit during the  year and contributed EUR 1 million as a result of  c ontinued gr owth o the business. 