UPDATE 1-Dutch insurer Aegon's H2 core profit beats expectations

(Adds CEO quote, detail)

AMSTERDAM, Feb 11 (Reuters) - Aegon beat analysts’ expectations with a 7% increase in second-half core earnings to 1.03 billion euros ($1.25 billion) helped by cost savings and rising stock prices, the Dutch insurer said on Thursday.

That was up from 963 million euros a year earlier and beat the 796 million euros in pretax underlying earnings forecast by analysts.

Aegon, which does two thirds of its business in the United States, said earnings were helped by higher equity prices in the United States, while the effects of the COVID-19 pandemic remained “manageable”.

Aegon said it was reviewing its U.S. variable annuity hedging program, as part of its announcement last year that it would aim to improve profitability by selling businesses that were either costly with volatile returns, or relatively small.

“We enter 2021 with momentum, but conscious of the fact that there is a lot of work to do to drive further operating improvements”, CEO Lard Friese said.

The insurer said its solvency rate remained roughly stable at 196% at the end of December, enabling it to propose a full-year dividend of 0.12 euro per share for 2020, after paying out 0.16 for 2019.

It aims to increase its dividend to 0.25 euro per share by 2023.

$1 = 0.8247 euros Reporting by Bart Meijer; editing by Shri Navaratnam and Jason Neely