A unit of AEGON Institutional Markets will be raising $700 million by issuing 7-year notes.

The unit, Monumental Life Global Funding III, will be splitting the note offering into a fixed-rate “tranche,” or batch, or a variable-rate tranche, according to AEGON Institutional, Louisville, Ky., a unit of AEGON N.V., The Hague, Netherlands.

The notes in the $300 million fixed rate tranche will pay a fixed rate of 5.25%.

The notes in the $400 million variable-rate tranche will pay a rate 0.2 percentage points higher than the 3-month London Interbank Offered Rate, according to AEGON Institutional.

The notes are scheduled to mature Jan. 15, 2014.