‘I’ve been with NN Group for 2.5 years now.  At the Asset-Liability Management & Hedging department one of our objectives is to look whether our assets and liabilities are in line, for example in terms of maturity and currency, and we remove unwanted risks. We use an expected cash flow pattern to look at our liabilities. Based on thousands of policies, we can say with relative certainty when and how much we need to pay out. So, if you expect to have to pay out an amount in two years’ time, you shouldn’t lock it for ten years. We also lower the total risk by spreading our risk across different types of risk, such as credit risk and equity risk. But also by limiting the concentration risk on counterparties, sectors and regions.’


The bridge between risk and return
‘Essentially, we bridge the gap between risk and return. Risk is sometimes seen in a negative perspective, but caution isn’t a bad thing and doesn’t mean that risk management will result in a lower return.’ Quite the reverse. We are in favour of risk, but it has to be the right risk. We encourage the business to generate the highest possible return on risk by seeking an optimal balance. Risk is increasingly being integrated into the first line, so it’s not only the Risk department that is responsible for risk. This also creates a greater understanding and appreciation of risk and of the borders in which the business needs to operate. The bridge between risk and return ensures unity and the future of our business. That’s a positive thing:  look at the strong position we’re in now.’


Our solvency position
‘We also manage our solvency position in accordance with European rules. This position is constantly changing; for example by market movements or because of changes to our investment portfolios, we are launching new products and other products are expiring. Or because  of changing regulation. But also, because we are constantly improving our models, enabling us to determine our solvency position more accurately. We have promised our shareholders a certain degree of stability. Our aim is to achieve that and to minimise the likelihood of any surprises when the quarterly figures are published.’

‘We also deal with strategic issues. Look at the current trend that risks are increasingly given back to the customer. This is something we are seeing with the scaling down of pension schemes. Guaranteed schemes seem to have had their best time and funds are moving towards a more individualized approach of pension payments. What impact will this trend have on risk management?’

A flexible and pleasant working environment
‘Shareholders, customers, regulators all have different interests and a different view of the relationship between risk and return. But they’re there for a reason. We need them. And so, we need to give them something back. Certainty and a return. That’s what makes my job so complex and exciting. I really enjoy working here. It’s a flexible and pleasant working environment with colleagues who have a lot of knowledge and where I’m given the space I need to take the initiative and responsibility and to develop my potential.’


Freek Zandbergen

Head of ALM & Hedging, NN Group