Mumbai: Dutch insurance giant Aegon NV has taken a $3.7 billion (3 billion-euro) funding from the Dutch government that the company said would help shore up its finances amidst the global financial turmoil.

The Dutch government will provide the funds through Association Aegon, the company's biggest shareholder. Aegon in turn will issue 750 million non-voting securities at €4 each to Association Aegon.

The company will be able to buy back the securities at 150 per cent of face value, or €6 a share, or convert them into shares. The securities carry a coupon of at least 8.5 per cent.

Aegon also has the option of buying one third of the shares before October next year at a reduced rate.

The Dutch finance ministry said, unlike the nationalised Benelux financial conglomerate Fortis, Aegon was a ''healthy and well-run'' insurance business.

But, with two-thirds of its operations based out of Baltimore in the US, where it operates insurer Transamerica,  Aegon is also one of Europe's most vulnerable companies to the financial market crisis.

Aegon said it expected to post a loss of about 350 million euros ($436 million) in the third quarter following €800 million in asset markdowns and the bankruptcies of Lehman Brothers and Washington Mutual. Aegon scrapped its final dividend and all executive bonuses for the year and also agreed to let two government-appointed supervisory board members.

Aegon chief executive Alex Wynaendts welcomed the additional capital infusion by the Dutch government and said Aegon could now maintain its credit ratings without raising fresh capital.

The fresh funding would help customers, business partners and Aegon employees in Baltimore and elsewhere in the United States, a company spokesman said, adding that Aegon is well-capitalised with healthy cash flows, ample liquidity and is in an even stronger position to withstand any further downturns in the market.

Aegon's US holdings in the US also include Monumental Corp, a Baltimore-based life insurer it acquired in 1986.

Aegon, based in The Hague, also owns Scottish Equitable and Guardian Assurance in the UK. Aegon has 31,500 employees worldwide, including about 700 in the Baltimore region.

The financial market crisis has so far forced four major Dutch financial companies to either restructure or give up operating freedom after government cash infusion. Fortis – a joint Belgian-Dutch group – has been nationalised while ABN Amro was sold to a consortium including RBS; ING Groep NV last week took 10billion government funding while Aegon got $3.4 billion boost.