Making the Unbankable Investable: Aegon’s Insured-Credit Route into Emerging Market Impact
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Article Type
Insights
Topic
Alternative Fixed Income
Published
September 01, 2026
Read time
5 mins
Author
Aegon Asset Management
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In this interview with NordSIP, George Nijborg, Head of Insured Strategies and European Private Placements at Aegon Asset Management, discusses how insured credit can help mobilise private capital towards impactful projects in emerging markets.


In emerging markets, the projects that most need financing and have, therefore, the highest potential for positive impact, are often the hardest for an institutional investor to hold. A loan funding a hydroelectric dam or a rural electrification grid may carry a sub-investment-grade rating and a capital charge that makes it inefficient to own, on top of a borrower few institutions know well. This is where Aegon Asset Management’s Insured Credit strategy comes in and makes these opportunities investable for institutions that care about capital charges.

George Nijborg, Head of Insured Strategies and European Private Placements at Aegon Asset Management and one of the architects, explains it simply: wrap the loan in credit insurance from A- and AA-rated insurers, and the investor’s exposure to a B-category frontier sovereign becomes exposure to names like AXA, Swiss Re or Lloyd’s of London. The capital still funds the dam; the credit risk sits with a large developed-market insurer. Both legs of the trade have existed for a while. What Aegon did, starting in 2021, was combine them.

Combining two established markets

The strategy sits on two foundations, each of which long predates it. The first is the export credit agency (ECA) guaranteed market, in which national agencies (such as Sweden’s SIDA and Denmark’s EIFO, previously known as EKF) backstop loans to make otherwise difficult risk investable. “Traditionally, the export credit agencies and the triple-A type institutions have stepped in to provide guarantees on these loans to make them investable,” Nijborg explains. “As an investor, you ultimately have government risk, and that is relatively easy to understand internally.” Aegon has been active in that space since 2007.

The second foundation is the credit insurance that banks have used for decades to manage their own loan books. The market is large: roughly US$ 192 billion of loans are credit insured, mostly by banks, around three-quarters of them European. “You cannot take the full loan on your balance sheet because of credit limits and capital efficiency reasons,” Nijborg notes, “so the banks use the credit insurance product” to cover the underlying loan and lend on.

Insured Credit, launched in 2021, fuses the two. “Basically, we combined those and created insured credit,” says Nijborg, who came to Aegon Asset Management from debt capital markets syndication desks at Morgan Stanley, Citi and Goldman Sachs, and helped give the strategy what he calls its “little baby” beginnings. The result, in his words: “What this leads to is the mobilisation of private capital into these opportunities that would not be able to otherwise. You are making something that is traditionally more difficult to invest in, investable.”

Anatomy of a deal

To bring the strategy to life, Nijborg describes his first transaction, which is representative of many of the deals he has concluded since. A multilateral development bank held a large sovereign loan it was looking to underwrite, funding a set of projects in an African country, one of which was the construction of a hydroelectric dam. Such projects rarely sit alone. “Those underlying projects are usually co-invested by other multilaterals,” he says. “We see a lot of the World Bank, EBRD, those types of institutions already funding the underlying projects, so they have performed a huge amount of on-site due diligence. That is a great opportunity for us to leverage off.”

The structure itself is best read through the numbers, which Nijborg rounds for clarity. “Let’s say for the sake of simplicity that loan was €100 million. They could hold, say, €20 million on their balance sheet, which they would hold for the life of the transaction, uninsured and unguaranteed, taking the naked exposure to the sovereign loan. Then we take the rest, so €80 million, and get that credit insured.” Insuring it means going to market. “There are approximately 85 different insurers involved in this space. We tell them: we have this loan with this originator; we can pay you a premium rate of X percent to take on 100% of the credit risk of the underlying borrower. Do you want to insure the loan, yes or no?” Insurers decide based on their current risk level and price sensitivity. A single insurer may take the whole exposure, or five or ten may each carry a slice. Aegon keeps the structuring deliberately plain: “we try to keep it quite straightforward, taking vertical slices.” Each insurer therefore sits pari passu on the same risk, and the investor ends up exposed to a handful of single-A and double-A names, each covering its portion.

An attractive return

The model portfolio targets EURIBOR plus 215 basis points for an expected loss of less than one basis point, a striking combination, and the obvious question is why it has not been arbitraged away. Nijborg’s answer starts with the economics of a single deal. “Say an underlying loan pays 500 basis points. That’s the spread we spend to pay the insurance premium, the cost of the transaction, and the investor. We step in and say we need to achieve pricing of 215 basis points in order to invest, because the client sitting behind us has an opportunity cost. So out of the 500, 215 is accounted for. Say 25 basis points goes to rating and legal costs to set up the transaction. That leaves 260 basis points, which we take to the insurer: I have 260 basis points I can pay you as premium to take on the credit risk. And that’s where the discussion starts.”

Why the spread has not been competed away comes down, in his account, to access. “The barrier to entry into this market is relatively high, because we have put a lot of effort and time into building relationships with these insurance companies. They know us, they know who they are insuring. It is a relationship business.” Part of the compensation, Nijborg agrees, is also for illiquidity: it is “a buy-and-hold investment, and it should be treated as such. There is no publicly available liquid market.” Banks could probably bid on a loan, but with “no guarantee you get the right price or the right size,” he adds, careful not to overstate the constraint.

Stable supply of impactful projects

For a strategy reliant on a steady flow of originations, the pipeline is notably undramatic. “It is not like the public markets, where they open and close and there is a lot of pricing variability,” Nijborg says. “It is very stable in supply, and very stable in pricing. You won’t see massive swings to the upside, you won’t see massive swings to the downside.”

The projects themselves cluster around a few themes. Infrastructure dominates, but with a wider array of projects than in developed markets. “It includes things that in our countries we take for granted, such as road development. And when I say road development, I mean rehabilitation of roads, where instead of the roads we are used to here, you have dirt tracks with potholes that get flooded during the rainy season. A lot of money is needed to asphalt those roads, create drainage on the sides, but also make them safe, with traffic lights, street lighting, traffic control centres.” Electrification is a second strand: “A lot of the grids are concentrated in the main cities, but the rural communities have nothing; there’s no grid to plug into. Some of the financing we’ve done is to expand that grid beyond the cities,” alongside solar power plants and solar-powered street lighting. A third, growing strand is microfinance and SME financing, reached by lending to financial institutions rather than directly. “Those are risky loans in themselves, because they on-lend to SMEs and individuals, so the use of a guarantee or insurance is absolutely critical to make it investable.” Its growth, he thinks, reflects “more sophisticated financial markets in those countries and better technology, where individuals get better access to those funding platforms.”

Impact, ex ante and ex post

Often impact claims are read differently depending on where the strategy sits in an investor’s portfolio. Aegon sees two buckets: a capital-optimisation play, substituting for corporate credits or private placements, or a sustainable allocation for clients who ring-fence part of their portfolio for impact. For the first group, impact is a secondary goal and represents an added benefit. Within the second bucket, the impact provided by Aegon’s strategy works to three themes: infrastructure, climate and energy, and human development and wellbeing.

The discipline is both ex ante and ex post. “Before entering the financing, we screen not only for the positive impacts of a project but also the negative ones,” Nijborg says, citing “do no significant harm” analysis and the environmental and social reports that flag risks such as the community displacement a hydropower dam can cause. Once the money is committed, “we negotiate certain ESG-linked KPIs that track the impact,” designed to be “intentional, but also measurable.” A responsible investment team, separate from the portfolio managers, drives the process and can veto a deal: allegations of corruption, or negative impacts that are “not dealt with in the right way,” are enough to decline a project.

The scalability question

Asked what risk the market may be under-pricing over the next five to ten years, Nijborg sets pricing aside. “Just like a lot of private-market strategies, the key thing is scalability. We are reliant on the insurers having the appetite to insure a loan,” he says. He does not think the ceiling is close: with “85 or so” large insurers, and Aegon “a relatively small part” of the US$ 192 billion credit-insured market, the depth is still there. Geopolitics he reframes as the reason the product exists: “What we’re offering is protection; if anything, you could argue the value of the insurance increases with more geopolitical tension. We look beyond the cycle.”

The franchise is built the way Aegon builds others: seed capital from affiliate balance sheets first, third-party investors once the strategy is established. Asked how it can be tailored to particular investor needs, especially the sustainability demand common among Nordic allocators, Nijborg points to bespoke impact mandates. “We can create insured credit with impact mandates, really impact investing, for clients who see that as a key driver or who struggle to find the right risk-reward profile for impact. This could be a really nice way to do it, and it works particularly well for the Nordics,” he concludes.

This article was created in collaboration with NordSIP and was originally published on NordSIP.com on 12 August 2026. Read the original publication on NordSIP.com.

 

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Aegon Asset Management
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