Allianz SE · XETR:ALV
Allianz — FY2008 Earnings Presentation
167 slides from Allianz's earnings presentation, February 2009
Slide 1: 3+One reloaded - Analysts' conference
3+One reloaded Analysts’ conference February 2009 Please note: Presentations based on 2008 preliminary figures
Slide 2: Agenda
Agenda Strategic priorities Michael Diekmann A Group financial results 2008 Helmut Perlet B Embedded value 2008 Helmut Perlet C Delivering the Best of Allianz Oliver Bäte D Capital and investment discipline Paul Achleitner E Glossary © Allianz SE 2009 Appendix Investor Relations contacts Financial c
Slide 3: Strategic priorities
Michael Diekmann, CEO Strategic priorities Analysts’ conference February 2009
Slide 4: 2008 at a glance: solid underlying performance in very difficult environment
A. Strategic priorities 2008 at a glance: solid underlying performance in very difficult environment Significant negative market impact, … … but still more than EUR 7bn operating profit Divestment of Dresdner Bank Sound capital and solvency position EUR 3.5 dividend proposal © Allianz SE 2009 Positi
Slide 5: Allianz stock freed of banking discount
A. Strategic priorities Allianz stock freed of banking discount Subprime Recession fears Global crisis 170 150 130 110 DJ EURO STOXX 600 Insurance 90 -67.3% 70 -69.8% Allianz 50 © Allianz SE 2009 30 -78.6% H2 2007 H1 2008 H2 2008 H1 2009 Source: Thomson Reuters Datastream; as of 20.2.2009 DJ EURO ST
Slide 6: Relative market position improved
A. Strategic priorities Relative market position improved (Market cap in EUR bn) Start of 3+One (12/2002) Start of financial crisis (06/2007) December 2008 1. CITIGROUP 172.6 CITIGROUP 187.5 ICBC 125.1 2. AIG 143.8 BANK OF AMERICA 160.6 CHINA CON.BANK 92.3 3. HSBC 99.7 HSBC 159.2 JP MORGAN CHASE 84.
Slide 7: 3+One priorities remain
A. Strategic priorities “3+One” priorities remain FCD solvency ratio (%) critical 161 1 Protect and enhance capital base 2002 20081 Operating profit (EUR bn) 7.4 Substantially strengthen 2 operating profitability negative 2002 2008 Minority buyouts Dresdner Bank disposal 3 Reduce complexity Ce
Slide 8: Business portfolio well balanced for current environment
A. Strategic priorities Business portfolio well balanced for current environment Segments1 Regions Distribution2 Operating profit in % Operating profit in % Insurance revenues in % Other 4% (car manufacturers, AM P/C Growth markets Germany affinity) Tied Specialty agents insurance 6% Bancassurance L
Slide 9: Strategic focus after Dresdner Bank
A. Strategic priorities Strategic focus after Dresdner Bank Strategic focus Rationale Management attention ‘09 Long-term savings (L/H, AM) Growth Selective growth (ALM), VA business Products Risk management (P/C) Cash Cycle management Growth/cash Earnings stability Regions Global, but selective bala
Slide 10: Strategic focus: profitability first
A. Strategic priorities Strategic focus: profitability first Value creation Optimization of total value Cross-border chain optimization Industrialization Local competitiveness Business model harmonization Group capital management + integration Segment optimization 2003 2005 2008 2011 Key ini
Slide 11: Strategic focus: disciplined M&A policy
A. Strategic priorities Strategic focus: disciplined M&A policy Recent transactions Koç Allianz minorities (Turkey) Progress Garant (Russia) ROSNO minorities (Russia) Allianz Leben minorities Selective ATF Polis (Kazakhstan) acquisitions Allianz Taiwan Life minorities only Commerce Assurance Berhad
Slide 12: Shake-out in U.S. financial industry
A. Strategic priorities Shake-out in U.S. financial industry … The U.S. insurance market Market Cap The Hartford Worldwide premium income U.S. Insurance industry (USD bn)1 Profile Among strongest U.S. brands Other 10% Western Europe -74% South & East Asia 4% 41% Outstanding distribution network
Slide 13: Strategic focus: transparent capital management
A. Strategic priorities Strategic focus: transparent capital management FCD solvency ratio 170% = Allianz cap Full stress scenario buffer still 161% in place even after two years 150% = Allianz floor of crisis 50% = Stress buffer Solvency ratio immunized against interest rate changes 100% = Mini
Slide 14: Sensible dividend policy
A. Strategic priorities Sensible dividend policy Dividend per share (EUR) 5.50 Payout ratio based 2008 on net income from continued operations 3.80 3.50 Balance between payout and solvency 2.00 Approximately 6% dividend yield Payout ratio 19% 23% 31% 40% © Allianz SE 2009 2005 2006 2007 2008 A
Slide 15: Underlying operating profitability
A. Strategic priorities Underlying operating profitability (EUR bn) ~1.0 Selected approximated ~8.0 operating profit sensitivities: ~2.4 ~ -0.8 P/C Combined ratio ~1.5 1%-p. EUR 0.4bn ~0.9 Assumption: No realized ~5.4 L/H Equity markets gains/losses +20% Depends on realizations -20% - EUR 0.6bn1 Ass
Slide 16: Outlook: tough year ahead, but ...
A. Strategic priorities Outlook: tough year ahead, but … 1 Strong capital 161 Solvency ratio1 position (%) Fixed income 87% 2 Sustainable investment Structure Equities 9% of investment Real estate 2% strategy portfolio Other 2% 3 Overweight Operating profit P/C 73% (%) Other 27% in P/C 4 Underweight
Slide 17: Today's presentations: how to cope with the challenge
A. Strategic priorities Today’s presentations: how to cope with the challenge Operational excellence Oliver Bäte Management focus in times of crisis Risk management Helmut Perlet Capital and © Allianz SE 2009 investment discipline Paul Achleitner A 15
Slide 18: Group financial results
Helmut Perlet, Member of the Board of Management Group financial results 2008 Analysts’ conference February 2009
Slide 19: Difficult markets, but our fundamentals remain strong
B. Group financial results 2008 Difficult markets, but our fundamentals remain strong … Operating profit of EUR 7.4bn in 2008 - P/C largely unaffected by the financial markets crisis - Focus on operational excellence showing results ! Solvency in the target range Divestment of Dresdner Bank co
Slide 20: As evidenced by EUR 7.4bn operating profit
B. Group financial results 2008 … as evidenced by EUR 7.4bn operating profit … Figures restated (EUR mn) throughout the presentation for discontinued banking operations Quarterly results Year-to-date results 4Q 06 4Q 07 4Q 08 12M 06 12M 07 12M 08 CAGR CAGR Operating profit1 -32.6% -10.2% 9,219 10,31
Slide 21: ... and 161% solvency ratio
B. Group financial results 2008 … and 161% solvency ratio Shareholders’ equity1 reduced Solvency after Dresdner Bank sale (EUR mn) -29.5% (EUR bn) Requirement Solvency ratio3 Available funds 49,650 190% 161% 161% 47,753 Unrealized 49.5 gains/losses 13,392 10,470 46.5 33,684 Revenue 8,962 2,011 reser
Slide 22: Agenda
Agenda 4Q Results Group Dresdner Bank sale P/C L/H Banking Asset Management Summary Additional information © Allianz SE 2009 B5
Slide 23: 4Q: rough financial markets
B. Group financial results 2008 4Q: rough financial markets Total revenues1 -10.1% (EUR bn) 23.3 25.6 Topline suffers 23.0 especially in L/H and Asset Management … 4Q 06 4Q 07 4Q 08 Operating profit (EUR mn) -63.2% … but we still make EUR 1bn operating 2,107 2,598 profit 956 Net income from n/m cont
Slide 24: 4Q: P/C – continues to deliver
B. Group financial results 2008 4Q: P/C – continues to deliver (EUR mn) Operating profit -25.0% 1,894 Operating profit drivers 1,651 1,683 1,651 1,487 1,479 1,311 1,267 1,249 1,238 +124 1,238 -448 -89 CR CR CR 95.0% 90.9% 95.8% Operating Under- Invest- Other Operating profit writing ment profit 4Q 0
Slide 25: 4Q: L/H – operating loss reflects financial markets turmoil
B. Group financial results 2008 4Q: L/H – operating loss reflects financial markets turmoil (EUR mn) Operating profit n/m 873 Operating profit driver1 750 758 698 703 614 614 589 -31 +64 -304 218 -951 -304 Operating Technical Investment Expense Operating profit result result result profit 4Q 1Q 2Q 3
Slide 26: 4Q: Continuing Banking
B. Group financial results 2008 4Q: Continuing Banking (EUR mn) Operating profit n/m Operating profit drivers 23 19 4 14 4 CIR CIR 93.4% 110.9% -3 +14 -9 -14 -4 -25 -17 -25 -39 Operating Op. Op. Net Operating 4Q 1Q 2Q 3Q 4Q 1Q 2Q 3Q 4Q profit revenues expenses LLP profit 4Q 07 4Q 08 Δ 4Q 08/07 2006
Slide 27: 4Q: Asset Management
B. Group financial results 2008 4Q: Asset Management – solid asset base ensures profitability even under extreme conditions (EUR mn) Operating profit -44.4% 395 392 Operating profit drivers 325 330 312 281 392 241 218 186 218 -133 -22 -19 CIR CIR 55.4% 69.9% Operating Net fee & Other Op. Operating 4
Slide 28: Agenda
Agenda 4Q Results Group Dresdner Bank sale P/C L/H Banking Asset Management Summary Additional information © Allianz SE 2009 B 11
Slide 29: Revenue shortfall of EUR 5bn driven by unit-linked products
B. Group financial results 2008 Revenue shortfall of EUR 5bn driven by unit-linked products … (EUR bn) Total revenues1 Δ 2008/07 CAGR F/X impact -1.7 -1.2% Unit-linked -5.0 thereof Bancassurance -3.8 97.7 94.9 92.5 3.3 Total Internal 3.0 2.9 (in %) growth growth3 0.6 0.6 0.5 2007 +3.0 +4.1 47.42 49.
Slide 30: ... but operating profit remains strong
B. Group financial results 2008 … but operating profit remains strong … (EUR mn) Business segments 2008 Δ 08/07 Property/Casualty Life/Health CAGR CAGR -5.1% -31.4% P/C 5,649 -10.3% 6,269 6,299 5,649 L/H 1,206 -59.7% 2,565 2,995 1,206 Banking -31 n/m 2006 2007 2008 2006 2007 2008 AM 926 -31.9% Banki
Slide 31: ... and despite net capital losses
B. Group financial results 2008 … and despite net capital losses … (EUR mn) Non-operating harvesting 2007 2008 Breakdown of non-operating items Realized gains/losses 2,379 2,656 - Equities 2,584 2,623 2006 2007 2008 Δ 08/07 - Debt securities -359 -26 - Real estate 156 59 Realized gains/losses 2,667
Slide 32: EUR 4bn net income from continuing operations
B. Group financial results 2008 … we deliver EUR 4bn net income from continuing operations (EUR mn) Reconciliation to net income 2006 2007 2008 Δ 08/07 Operating profit 9,219 10,313 7,433 -2,880 Non-operating items 344 250 -1,960 -2,210 Income before taxes, minority interests 9,563 10,563 5,473 -5,0
Slide 33: RoRAC on continuing operations well above cost of capital
B. Group financial results 2008 RoRAC on continuing operations well above cost of capital (after minority interests, EUR mn) 20081 Avg. RAC2 RoRAC3 Group RoRAC3 (in %) P/C 20,725 19.2% -4.8%-p L/H 11,212 13.3% 22.2 23.4 18.6 Banking 607 -24.5% AM 1,488 44.4% 20061 20071 2008 Corporate4 2,780 -21.3%
Slide 34: Regulatory solvency at target level
B. Group financial results 2008 Regulatory solvency at target level Conglomerate solvency after Dresdner sale (EUR bn) Requirement Solvency ratio1 Available funds Solid 161% pro-forma FCD solvency 190% 161% 161% ratio at Group level 49.5 46.5 61%-p buffer to minimum adequacy levels 32.7 28.9 I
Slide 35: All stress tests indicate sufficient capitalization
B. Group financial results 2008 All stress tests indicate sufficient capitalization … Conglomerate solvency ratio (in %) Impact on IFRS equity Target: 150% Estimation in EUR bn 100% 150% Ratio as of 31.12.081 161% Equities -30% 136% -5.06 Interest rate +100bps 161% -3.5 Interest rate -100bps 159% 3.
Slide 36: Internal solvency ratio of 140%
B. Group financial results 2008 Internal solvency ratio of 140% (EUR bn) Economic solvency Solvency ratio Calculated at a 3bps confidence level (comparable to AA) 196% 191% Adequately capitalized in economic terms 140% Largest contribution to declining ratio since 2007 was decline in asset val
Slide 37: Agenda
Agenda 4Q Results Group Dresdner Bank sale P/C L/H Banking Asset Management Summary Additional information © Allianz SE 2009 B 20
Slide 38: Dresdner Bank sale: fair value changes increase loss on disposal
B. Group financial results 2008 Dresdner Bank sale: fair value changes increase loss on disposal (EUR bn) 9M 08 P&L effect Result -2.1 12M 08 1Q 09 Total loss at from 12.01.2009 discontinued Impairment Result from OCI1 operations discontinued operations -1.4 -6.4 -0.4 -6.8 4Q 08 Fair value change -2
Slide 39: Dresdner Bank sale: changes in consideration and fair value
B. Group financial results 2008 Dresdner Bank sale: changes in consideration and fair value (EUR bn) -2.7 7.8 Trust 0.1 Changes to fair value since 30.09.08: EUR 0.25bn cash received in exchange for 315mn cancellation of trust fund valued at EUR 163mn Commerzbank 5.1 Commerz- shares 0.1bn: fair va
Slide 40: Agenda
Agenda 4Q Results Group Dresdner Bank sale P/C L/H Banking Asset Management Summary Additional information © Allianz SE 2009 B 23
Slide 41: P/C: operating profit largely unaffected by financial markets crisis
B. Group financial results 2008 P/C: operating profit largely unaffected by financial markets crisis (EUR mn) Operating profit CAGR -5.1% Operating profit drivers 6,299 6,269 6,299 5,649 5,649 +152 -546 -256 Operating Under- Invest- Other Operating profit writing ment profit 2007 2008 Δ 2008/07 2006
Slide 42: P/C: in mixed pricing environments
B. Group financial results 2008 P/C: in mixed pricing environments … (in %) New business price trend 20081 – flagship OEs Personal Commercial Motor Non- Total Motor New business was written at rates Germany -0.2% +1.5% -2.4% +3.6% +0.7% ~0.1% lower than prior year and France +1.6% +0.8% +0.7% +2.0
Slide 43: P/C: we achieve selective growth
B. Group financial results 2008 P/C: … we achieve selective growth … (EUR mn) GPW Combined ratio 2006 2007 2008 Δ 08/071 Gross premiums written (EUR bn) Germany2 9,539 9,425 9,344 -0.9% AGF health business France3 5,110 5,086 3,930 +1.2% +0.5%5 Italy 5,396 5,229 4,741 -9.0% UK 2,396 2,236 1,925 0.0%
Slide 44: P/C: allows for 95% combined ratio
B. Group financial results 2008 P/C: … that allows for 95% combined ratio (in %) Combinedratio Combined ratio 2006 2007 2008 Combined ratio Germany1 92.0 92.6 95.3 Δ 08/07 France 99.2 97.3 97.2 92.9 93.6 95.1 +1.5%-p Italy 91.8 94.8 96.7 UK 94.3 98.7 94.7 Spain 90.3 91.4 90.4 Loss Switzerland2 92.2
Slide 45: P/C: a.y. loss ratio trend below inflation
B. Group financial results 2008 P/C: a.y. loss ratio trend below inflation (in %) Quarterly ratios Year-to-date ratios Impact 4Q: Accident year loss ratio 2.3%-p credit 0.2%-p crop +0.6 71.8 +1.2 72.3 72.4 71.5 +1.5%-p +0.4 70.9 69.6 70.4 72.0 70.3 69.8 69.4 (9Q-Ø) 69.0 69.4 70.0 68.3 -1.5%-p 67.4 6
Slide 46: P/C: ongoing efficiency improvements
B. Group financial results 2008 P/C: ongoing efficiency improvements … (EUR mn) in % of NPE Administrative expense movements CAGR -1.1% 3,724 10,590 10,616 10,356 -86 -16 Admin. -69 expenses 3,9321 3,7241 3,325 -108 3,325 10.4 9.7 8.7 -120 Acqu. expenses 6,6581 6,8921 7,031 2007 Reclassi- fications
Slide 47: P/C: stable operating investment income
B. Group financial results 2008 P/C: … and stable operating investment income … Average asset base (EUR bn) Operating investment income (EUR mn) Other1 -3.7% Cash2 Equities 96.7 93.1 7.41 6.91 Interest and Debt 1.4 sec. 17.8 4.6 similar income 4,096 4,473 4,4774 11.5 70.1 70.1 in % of NPE 10.8 11.6
Slide 48: P/C: solid platform for 2009 deliveries
B. Group financial results 2008 P/C: … provide a solid platform for 2009 deliveries Claims inflation countered by: - systematic efficiency and effectiveness measures through sustainability, OTP, sourcing, etc. - renewal pricing change planned to be +1.5% in 20091 ! Robust investment income (a 10
Slide 49: Agenda
Agenda 4Q Results Group Dresdner Bank sale P/C L/H Banking Asset Management Summary Additional information © Allianz SE 2009 B 32
Slide 50: L/H: EUR 1.2bn operating profit despite markets turmoil
B. Group financial results 2008 L/H: EUR 1.2bn operating profit despite financial markets turmoil (EUR mn) Operating profit CAGR -31.4% Operating profit driver1 2,995 2,995 2,565 -72 1,206 -1,497 1,206 -220 Operating Technical Investment Expense Operating profit result result result profit 2007 2008
Slide 51: L/H: traditional business holds firm
B. Group financial results 2008 L/H: traditional business holds firm … (EUR mn) Stat. premiums 2006 2007 2008 Δ 08/071 Statutory premiums (EUR bn) Germany Life AGF health business 13,009 13,512 13,487 -0.1% -9.7%3 Germany Health 3,091 3,123 3,119 -0.1% France2 5,792 6,550 7,991 +4.8% 49.42 47.42 45.
Slide 52: L/H: cashflows positive
B. Group financial results 2008 L/H: … cashflows positive … (EUR bn) Operating asset base1 Net flows 2008 OAB 359.7 Germany Life +5.4 (as of 31.12.2007) Germany Health +1.2 Net inflows France +2.72 +15.12 Italy -2.0 Market effects Other Western Europe +1.5 -31.6 New Europe +1.1 USA +3.3 F/X effects
Slide 53: L/H: stable interest and similar income of EUR 13.8bn
B. Group financial results 2008 L/H: … stable interest and similar income of EUR 13.8bn … Avg. investm. & loans (EUR bn) Operating investment income (EUR mn) Other1 +1.9% Cash2 278.4 283.6 Equities 6.71 6.31 8.3 Interest and Debt 3.7 sec. 41.7 31.7 similar income 12,972 13,417 13,7724 226.7 236.9 20
Slide 54: L/H: sufficient investment income to absorb capital market variances
B. Group financial results 2008 L/H: … provides sufficient investment income to absorb capital market variances (EUR bn) Excess interest and similar income 2008 Excess sufficient to absorb further market 13.1 stresses: Excess return 4.3 Equity markets -30% -3.4 Corporate bond defaults 100bps -0.5 In
Slide 55: L/H: special focus AZ Life (1/2)
B. Group financial results 2008 L/H: special focus AZ Life (1/2) (USD mn) Variable annuities Operating profit Business was profitable in 3Q 2008 market conditions … 107 … but conditions became extreme at the end of 3Q and during 4Q, affecting the whole industry AZ Life has re-designed, de-risk
Slide 56: L/H: special focus AZ Life (2/2)
B. Group financial results 2008 L/H: special focus AZ Life (2/2) (USD mn) Fixed / indexed annuities Operating profit Widened credit spreads drive accounting mismatch, comprising 80% of decline in 252 operating profit Spread-related impacts are recoverable as spreads narrow Defaults could incre
Slide 57: Agenda
Agenda 4Q Results Group Dresdner Bank sale P/C L/H Banking Asset Management Summary Additional information © Allianz SE 2009 B 40
Slide 58: Continuing Banking
B. Group financial results 2008 Continuing Banking (EUR mn) Operating profit n/m Operating profit drivers 32 63 CIR CIR 94.1% 100.4% 32 +39 -24 -31 -78 -31 Operating Op. Op. Net Operating profit revenues expenses LLP profit 2007 2008 Δ 2008/07 2006 2007 2008 2008 544 -546 -29 © Allianz SE 2009 2007
Slide 59: Agenda
Agenda 4Q Results Group Dresdner Bank sale P/C L/H Banking Asset Management Summary Additional information © Allianz SE 2009 B 42
Slide 60: AM: operating profit of EUR 0.9bn in difficult markets
B. Group financial results 2008 AM: operating profit of EUR 0.9bn in difficult markets (EUR mn) Operating profit CAGR -15.3% Operating profit drivers F/X adjusted CAGR: -9.1% 1,359 1,359 1,290 -259 926 -113 -61 926 CIR CIR 58.3% 67.9% Operating Net fee & Other Operat. Operating profit comm. inc. inc
Slide 61: AM: net fee and commission income in line with lower AuM
B. Group financial results 2008 AM: net fee and commission income developed in line with lower 3rd party assets under management 3rd party AuM (EUR bn) Net fee and commission income (EUR mn) 3rd-party AuM driven margin1 (in bps) 37.3 37.1 36.5 -8.0% -8.3% 764 765 3,133 703 2,924 2,874 Other 9 7 1 Eq
Slide 62: AM: higher expenses from fixed income expansion and infrastructure
B. Group financial results 2008 AM: fixed income business expansion and build-up of infrastructure major drivers of higher expenses (EUR mn) Administrative expenses Cost-income ratio (in %) 57.6 58.3 67.9 +3.2% 1,900 1,961 1,754 Personnel 1,214 -4.2% 1,163 Business expansion fixed income: EUR expe
Slide 63: AM: equities suffer from the crisis
B. Group financial results 2008 AM: equities suffer from the crisis … Equities 3rd party AuM Performance2 Operating profit (EUR bn) Net flows (Outperforming AuM in %) (EUR mn) CAGR1 CAGR1 -20.6% -30.4% 169 172 79 135 147 70 62 102 64 +6.4 -0.4 -10.9 2006 2007 2008 2006 2007 2008 2006 2007 2008 AuM
Slide 64: AM: fixed income continues to deliver robust results
B. Group financial results 2008 AM: … while fixed income continues to deliver robust results Fixed income 3rd party AuM Performance2 Operating profit (EUR bn) Net flows (Outperforming AuM in %) (EUR mn) CAGR1 CAGR1 +10.6% +3.5% 91 87 776 838 798 586 586 600 48 +30.8 +12.4 +10.7 2006 2007 2008 2006 2
Slide 65: Agenda
Agenda 4Q Results Group Dresdner Bank sale P/C L/H Banking Asset Management Summary Additional information © Allianz SE 2009 B 48
Slide 66: Outlook: tough year ahead, but ...
B. Group financial results 2008 Outlook: tough year ahead, but … 1 Strong capital 161 Solvency ratio1 position (%) Fixed income 87% 2 Sustainable investment Structure Equities 9% of investment Real estate 2% strategy portfolio Other 2% 3 Overweight Operating profit P/C 73% (%) Other 27% in P/C 4 Und
Slide 67: Agenda
Agenda 4Q Results Group Dresdner Bank sale P/C L/H Banking Asset Management Summary Additional information © Allianz SE 2009 B 50
Slide 68: Group: result by segments overview
B. Group financial results 2008 Group: result by segments overview (EUR mn) P/C L/H Banking AM Corporate Consolidation Total 12M 07 12M 08 12M 07 12M 08 12M 07 12M 08 12M 07 12M 08 12M 07 12M 08 12M 07 12M 08 12M 07 12M 08 Total revenues 44.3 43.4 49.4 45.6 0.6 0.5 3.3 2.9 - - 0.1 0.1 97.7 92.5 (EUR
Slide 69: Group: key figures per quarter
B. Group financial results 2008 Group: key figures per quarter (EUR mn) 4Q 1Q 2Q 3Q 4Q 1Q 2Q 3Q 4Q Delta 12M 12M 12M 2006 2007 2007 2007 2007 2008 2008 2008 2008 4Q 08/07 2006 2007 2008 Total revenues 23.3 27.4 22.7 21.9 25.6 26.9 21.5 21.1 23.0 -2.6 94.9 97.7 92.5 (EUR bn) Operating profit 2,107 2,
Slide 70: 4Q: revenues
B. Group financial results 2008 4Q: revenues (EUR bn) Total revenues1 Δ 4Q 08/07 F/X impact 0.0 23.3 27.4 22.7 21.9 25.6 26.9 21.5 21.1 23.0 Unit-linked -1.9 thereof Bancassurance -0.9 0.8 0.7 0.9 0.8 0.2 0.1 Total Internal 0.8 0.8 0.2 0.7 (in %) growth growth3 0.7 0.7 0.2 0.1 0.2 12.3 0.1 0.2 0.1 1
Slide 71: P/C: key figures and ratios per quarter
B. Group financial results 2008 P/C: key figures and ratios per quarter (EUR mn) 4Q 1Q 2Q 3Q 4Q 1Q 2Q 3Q 4Q Delta 12M 12M 12M 2006 2007 2007 2007 2007 2008 2008 2008 2008 4Q 08/07 2006 2007 2008 Gross premiums written 9.4 14.1 10.0 10.7 9.5 13.7 9.8 10.8 9.0 -0.5 43.7 44.3 43.4 (EUR bn) Operating pr
Slide 72: P/C: RoRAC of major OEs
B. Group financial results 2008 P/C: RoRAC of major OEs (EUR mn, b/ min) Risk-adjusted capital1 RoRAC (in %) 2007 2008 Δ in % 2007 2008 Δ in %-p Germany2 3,849 3,202 -16.8% 30.6% 26.2% -4.4%-p France 2,083 1,986 -4.7% 18.2% 13.6% -4.6%-p Italy 2,616 2,051 -21.6% 20.7% 19.0% -1.7%-p UK 1,022 634 -38.
Slide 73: L/H: key figures and ratios per quarter
B. Group financial results 2008 L/H: key figures and ratios per quarter (EUR mn) 4Q 1Q 2Q 3Q 4Q 1Q 2Q 3Q 4Q Delta 12M 12M 12M 2006 2007 2007 2007 2007 2008 2008 2008 2008 4Q 08/07 2006 2007 2008 Statutory premiums 12.8 12.3 11.7 10.2 15.0 12.3 10.7 9.4 13.1 -1.9 47.4 49.4 45.6 (EUR bn) Operating pro
Slide 74: L/H: RoRAC of major OEs
B. Group financial results 2008 L/H: RoRAC of major OEs (EUR mn, b/ min) Risk-adjusted capital1 RoRAC (in %) 2007 2008 Δ in % 2007 2008 Δ in %-p Germany Life2 507 4,027 +694.3% 66.0 20.7 -45.3%-p Germany Health 170 175 +2.9% 48.5 55.6 +7.1%-p France2 2,359 2,415 +2.4% 14.0 14.5 +0.5%-p Italy2 1,101
Slide 75: Continuing Banking: key figures and ratios per quarter
B. Group financial results 2008 Continuing Banking: key figures and ratios per quarter (EUR mn) 4Q 1Q 2Q 3Q 4Q 1Q 2Q 3Q 4Q Delta 12M 12M 12M 2006 2007 2007 2007 2007 2008 2008 2008 2008 4Q 08/07 2006 2007 2008 Operating revenues 150 157 171 127 167 140 153 123 128 -39 604 622 544 Operating profit -9
Slide 76: Asset Management: key figures and ratios per quarter
B. Group financial results 2008 Asset Management: key figures and ratios per quarter (EUR mn) 4Q 1Q 2Q 3Q 4Q 1Q 2Q 3Q 4Q Delta 12M 12M 12M 2006 2007 2007 2007 2007 2008 2008 2008 2008 4Q 08/07 2006 2007 2008 Operating revenues 841 780 797 803 879 727 738 698 724 -155 3,044 3,259 2,887 Operating prof
Slide 77: Asset Management: 3rd party AuM
B. Group financial results 2008 Asset Management: 3rd party AuM1 (EUR bn) Asset mix Client mix Regional breakdown2 Other Retail Equities Institutional Debt securities Other3 765 764 765 764 764 765 Asia-Pacific 9 7 703 and Rest 41 40 703 703 1 62 64 31 169 172 Europe 52 102 280 303 185 ex Germany 11
Slide 78: Corporate: key figures per quarter
B. Group financial results 2008 Corporate: key figures per quarter (EUR mn) 4Q 1Q 2Q 3Q 4Q 1Q 2Q 3Q 4Q Delta 12M 12M 12M 2006 2007 2007 2007 2007 2008 2008 2008 2008 4Q 08/07 2006 2007 2008 Operating profit -246 -101 -10 -155 -59 -76 5 -54 -63 -4 -831 -325 -188 Non-operating items -156 511 -74 -166
Slide 79: Corporate: key figures – breakdown
B. Group financial results 2008 Corporate: key figures – breakdown (EUR mn) Holding function Private Equity 12M 07 12M 08 Δ 08/07 12M 07 12M 08 Δ 08/07 Operating revenues 809 780 -29 Operating revenues 2,600 2,755 +155 Operating expenses -1,255 -1,098 +157 Operating expenses -2,479 -2,625 -146 Opera
Slide 80: Group: breakdown of profit consolidation
B. Group financial results 2008 Group: breakdown of profit consolidation (EUR mn) Net income 2008 +53 P/C +34 CO -132 L/H -132 -297 Disc. ops. -210 -342 © Allianz SE 2009 Intra-group Intra-group Total dividends gains consolidation B 63
Slide 81: Group asset allocation: breakdown per segment
B. Group financial results 2008 Group asset allocation: breakdown per segment (EUR bn) P/C L/H Banking1 Asset Mgmt. Corporate Consolid. Group1 Balance sheet items 12M 07 12M 08 12M 07 12M 08 12M 07 12M 08 12M 07 12M 08 12M 07 12M 08 12M 07 12M 08 12M 07 12M 08 Investments Equities 2 16.5 6.4 41.2 22
Slide 82: Average AuM as basis for yield calculation
B. Group financial results 2008 Average AuM as basis for yield calculation (EUR bn) P/C L/H Balance sheet items 31.12.07 31.12.08 Average 31.12.07 31.12.08 Average Investments Equities 1 16.5 6.4 11.5 41.2 22.2 31.7 Debt sec. 50.3 51.6 51.0 137.6 154.4 146.0 Cash and cash 1.9 7.5 4.6 5.5 11.0 8.3 po
Slide 83: Investment result: breakdown per segment
B. Group financial results 2008 Investment result: breakdown per segment (EUR mn) P/C L/H Banking1 AM Corporate Consolidation Group1 12M 07 12M 08 12M 07 12M 08 12M 07 12M 08 12M 07 12M 08 12M 07 12M 08 12M 07 12M 08 12M 07 12M 08 Operating investment result Interest and similar income 4,473 4,477 1
Slide 84: Impairments: breakdown per segment
B. Group financial results 2008 Impairments: breakdown per segment (EUR mn) P/C L/H Banking1 AM Corporate Consolidation Group1 12M 07 12M 08 12M 07 12M 08 12M 07 12M 08 12M 07 12M 08 12M 07 12M 08 12M 07 12M 08 12M 07 12M 08 Operating Equities -67 -437 -815 -5,472 0 0 0 0 0 0 0 -15 -882 -5,924 Fixed
Slide 85: Goodwill
B. Group financial results 2008 Goodwill (EUR bn) Goodwill per segment 2007 2.2 L/H 2.3 2008 +0.3 12.4 0.0 2007 2.2 P/C 2008 2.3 11.2 -1.5 2007 6.2 AM 2008 6.3 2007 1.7 BA 2008 0.2 2007 0.1 CO 2008 0.1 © Allianz SE 2009 Goodwill Additions Currency Reclass. Goodwill 31.12.07 translation into held 31.
Slide 86: Equity table
B. Group financial results 2008 Equity table (EUR mn) Foreign Unrealized Paid-in Revenue currency Shareholders' Minority gains and Total equity capital reserves translation equity interests losses (net) adjustments Balance as of 31.12.07 28,321 12,618 -3,656 10,470 47,753 3,628 51,381 Foreign curren
Slide 87: Revaluation reserve of EUR 7.9bn
B. Group financial results 2008 Revaluation reserve of EUR 7.9bn (EUR bn) Off balance sheet Revaluation reserve On balance sheet Shareholders’ Policyholders’ 7.9 share share 2.2 (38.1%) 2.6 (43.9%) Real estate 5.9 Minorities 0.1 (0.7%) Associated enterprises, joint ventures 0.0 Deferred taxes 1.0 (1
Slide 88: Conglomerate solvency: details as of 31.12.08
B. Group financial results 2008 Conglomerate solvency: details as of 31.12.08 (pro-forma)1 (EUR bn) Available funds Required capital Shareholders’ 20.3 35.42 equity Proposed dividend for ‘08 -1.6 P/C 6.8 Goodwill/ other intangibles -14.1 Commerzbank shares -0.7 Subord. bonds, particip. certific. +6.
Slide 89: Risk capital breakdown
B. Group financial results 2008 Risk capital breakdown (EUR bn, b/ min, Group diversified) Risk capital by risk categories Risk capital by segments Δ Δ 33.4 33.4 30.3 -9.2% 30.3 -9.2% Market risk 13.9 P/C 16.9 14.3 +3.1% 15.8 -7.0% Credit risk 5.7 3.8 -34.3% L/H 5.4 Actuarial 8.2 +53.2% risk 6.5 7.0
Slide 90: Earnings per share
B. Group financial results 2008 Earnings per share (EUR) Basic EPS Diluted EPS From continuing operations From continuing operations 16.16 16.53 15.87 16.26 8.81 8.59 2006 2007 2008 2006 2007 2008 From discontinued operations From discontinued operations 0.93 1.47 -14.24 0.91 1.45 -14.06 © Allianz S
Slide 91: Embedded value 2008
Helmut Perlet, Member of the Board of Management Embedded value 2008 Analysts’ conference February 2009
Slide 92: L/H: difficult market environment
0.01 0.02 0.03 0.005 0.015 0.025 0.035 0 40 50 60 70 80 90 100 110 -0.01 -0.005 02.01.2008 02.01.2008 16.01.2008 16.01.2008 30.01.2008 30.01.2008 13.02.2008 13.02.2008 27.02.2008 27.02.2008 S&P 500 12.03.2008 12.03.2008 US AA Corp 26.03.2008 26.03.2008 09.04.2008 09.04.2008 C. Embedded value 2008 23
Slide 93: L/H: adverse impact on value of new business and embedded value
C. Embedded value 2008 L/H: … with adverse impact on value of new business and embedded value … (a/ min, EUR mn) Based on MCEV principles4 New business margin (NBV in % of PV of premiums) Value of new business Embedded value -2.2%-p -77% MCEV 2.9% Earnings: -0.1%1 1,106 -48%3 0.8% 291 24,430 3.0% 2,
Slide 94: L/H: in particular in 4Q
C. Embedded value 2008 L/H: … in particular in 4Q a/ min, EUR mn 2,178 1,943 24,430 256 2,504 Operating earnings EUR 4,377mn or 18% 12,545 - 15,768 - 331 - 162 Starting VNB Expected Operating Economic Other non- Net Ending Embedded business var. & ass. var. & assn. operating var. & capital Embedded
Slide 95: L/H: Europe – consistently high volumes at attractive margins
C. Embedded value 2008 L/H: Europe – consistently high volumes at attractive margins (a/ min, EUR mn) New business margin Value of new business (NBV in % of PV of NB premiums) Internal The business continues to be -0.8%-p growth: -25% attractive for the shareholder -29% 3.5 3.5 Volumes remain st
Slide 96: L/H: Europe – continued strong cash-flow generation
C. Embedded value 2008 L/H: Europe – continued strong cash-flow generation (a/ min, EUR mn) Change in EV driven by equity and interest rates VIF affected by historic low interest rates 20,915 654 -5,614 -3,492 3,662 16,124 4,500 6.0% 4,000 5.0% 3,500 4.0% 3,000 3.0% 2,500 2.0% Interest EuroStoxx 50
Slide 97: L/H: US – value of new business positive before 4Q
C. Embedded value 2008 L/H: US – value of new business positive at the point of sale before 4Q a/ min, EUR mn 60.0% S&P 500 Volatility (lhs) 6.0% 2007 Stable Market Full year US Swaps (rhs) 2008 development turbulence adjustm. 50.0% 5.0% 93 40.0% 4.0% 33 42 37 18 14 14 22 30.0% 3.0% 1Q 2Q 3Q 4Q 20.0
Slide 98: L/H: US – cash-flow generation still expected positive
C. Embedded value 2008 L/H: US – cash-flow generation still expected to be positive (a/ min, EUR mn) Change in EV driven by equity, interest rates and Equity markets are down and spreads are high spreads 1,600 3.5% 3,051 -364 -402 -4,260 -1,424 83 -3,318 1,400 3.0% 1,200 2.5% 1,000 S&P 500 (lhs) 2.0
Slide 99: L/H: fair value pro-forma based on 3Q 08 environment
C. Embedded value 2008 L/H: fair value pro-forma based on 3Q 08 environment better reflects normality a/ min, EUR mn 13,471 26,648 2007 2008 Pro-forma Germany Life 6,412 8,366 Germany Health 1,821 1,689 France 4,595 5,684 632 12,545 Italy 3,522 3,398 Other W. Europe 3,346 3,927 New Europe 567 732 US
Slide 100: L/H: embedded value summary
C. Embedded value 2008 L/H: embedded value summary MCEV 4Q 2008 saw dramatic market developments ! Even under these conditions, the business is still generating strong cash-flows If we return to 3Q-type environment only, market value loss is fully recoverable © Allianz SE 2009 C 10
Slide 101: Additional information
C. Embedded value 2008 Additional information © Allianz SE 2009 C 11
Slide 102: L/H: EV overview
C. Embedded value 2008 L/H: EV overview (a/ min, EUR mn) Embedded value (EV) VNB (NBM in %2) Comment 6,412 362 3.9% MCEV Germany 5,308 300 3.3% Low long term interest rates significantly impacts value - - - of traditional long term Health 1,092 15 1.6% businesses in Europe In addition, equity ma
Slide 103: L/H: new business – key profitability indicators
C. Embedded value 2008 L/H: new business – key profitability indicators’ (a/ min, EUR mn) Value of New business Present value of Recurring premium Single premium new business margin new business premium 2007 2008 2007 2008 2007 2008 Δ 2007 2008 Δ 12M 07 12M 08 Δ 1 Germany Life 362 300 3.9% 3.3% 9,18
Slide 104: L/H: sensitivity analysis (embedded value)
C. Embedded value 2008 L/H: sensitivity analysis (a/ min, EUR mn) Embedded value Economic factors Non economic factors Drop in equity risk free assumptions volatilities -5% mortality Base value by +25% +25% year end -10% death longevity -10% 10% - 100bp +100bp Case swaption equity vola expense risk
Slide 105: L/H: sensitivity analysis (value of new business)
C. Embedded value 2008 L/H: sensitivity analysis (a/ min, EUR mn) Value of new business Economic factors Non economic factors Drop in equity risk free assumptions volatilities -5% mortality Base value by +25% +25% -10% death longevity -10% 10% - 100bp +100bp Case swaption equity expense risk risk la
Slide 106: L/H: shareholder value not accounted for in IFRS equity
C. Embedded value 2008 L/H: shareholder value not accounted for in IFRS equity (a/ min, EUR mn) Value of inforce in EV 2,662 Adjust for: IFRS DAC / VOBA -17,348 Difference in life- and unallocated profit sharing reserves 11,191 Shareholder value of unrealized capital gains included in PVFP 1,3
Slide 107: L/H: consistent economic assumptions for EV
C. Embedded value 2008 L/H: consistent economic assumptions are applied for EV across Allianz Group Key parameters Specification 2008 (2007) Risk free rates EUR 3.1% (4.4%) CHF 1.1% (2.9%) (1 year zero coupon rate based on swap rate) USD 2.0% (4.3%) KRW 3.3% (6.1%) Risk free rate EUR 3.8% (4.8%) CHF
Slide 108: Towers Perrin review of MCEV results
C. Embedded value 2008 “Towers Perrin has undertaken a review of the MCEV results and their opinion will be provided in the full disclosure document.“ Allianz will publish its Embedded Value Report 2008 together with the Annual Report 2008 on March 13, 2009. © Allianz SE 2009 C 18
Slide 109: Delivering the Best of Allianz
Oliver Bäte, Member of the Board of Management Delivering the Best of Allianz Analysts’ conference February 2009
Slide 110: Strong operating platform to weather the current crisis
D. Delivering the Best of Allianz We have created a strong operating platform – enabling us to weather the current crisis Group profit development excl. discontinued banking operations1 (EUR mn) 10,313 Operating profit 9,219 Non-operating profit 7,373 7,433 6,547 4,491 1,446 1,424 344 250 -612 -1,21
Slide 111: 3+One strategy with strong results
D. Delivering the Best of Allianz 3+One strategy with strong results “3+One” Results Today’s focus Enhanced Solvency ratio with 161%1 at the Protect and enhance capital base capital base top of our industry Around EUR 250mn targeted OTP Strengthen operating savings per year profitability Opera
Slide 112: OTP starts to pay off – around EUR 250mn productivity gains per year
D. Delivering the Best of Allianz OTP1 starts to pay off – around EUR 250mn productivity gains per year for the next 3 years Targeted OTP savings to date2 (EUR mn) 912 - 1,062 220 - 270 220 - ~ 13% of 270 cost base- 220 - line 270 -66 318 Õ 2007 2008 2009e 2010e 2011e Targeted savings Run-up schedul
Slide 113: Savings start to show in our IFRS financials
D. Delivering the Best of Allianz Savings start to show in our IFRS financials Evolution of internal cost base in P/C & L/H1 (gross, EUR bn) 11.7 0.3 -0.3 11.1 -0.6 OTP addresses: P/C and L/H - Admin. cost - Acquisition overhead - LAE © Allianz SE 2009 2007 Cost Non- Inflation- 2008 pro inflation op
Slide 114: P/C administration cost trending downward
D. Delivering the Best of Allianz P/C administration cost trending downward (EUR mn) % of NPE CAGR Administrative expense movements -1.1% 3,724 10,590 10,616 10,356 Admin. -86 -16 expenses 3,9321 3,7241 3,325 -69 -108 3,325 10.4 9.7 8.7 -120 Acqu. 1 6,8921 expenses 6,658 7,031 2007 Re- Con- F/X MTM
Slide 115: Allianz Austria – an example for operational transformation
D. Delivering the Best of Allianz Allianz Austria – an example for operational transformation P/C expense ratio (%) Change of company structure Shift of service processes to 32 one centralized customer service center, instead of 10 regional branches Establishment of Market Market Management function
Slide 116: Delivering the Best of Allianz with TOM
D. Delivering the Best of Allianz We will now deliver the “Best of Allianz” with TOM as our common framework for transformation “3+One reloaded” Enhanced capital Superior ALM, risk and base capital management Operational excellence: efficiency and effectiveness along the entire value chain Target Op
Slide 117: Next chapter of OTP addresses cross-functional opportunities
D. Delivering the Best of Allianz Next chapter of OTP addresses cross-functional and cross-business opportunities Assumed savings potential by 20111 (EUR mn) Complexity cost reduction 200 - 250 Levers of delivering Factor cost optimization 80 - 100 the “Best of Allianz” Application Development produ
Slide 118: ADM multisourcing program targets cost savings by 2011
D. Delivering the Best of Allianz ADM1 multisourcing program targets up to EUR 135mn annual costs savings by 2011 Evolution of total annual Group ADM productivity2 (EUR mn, target state, 2009 - 2011) Program objectives: 10 - 14% Productivity gain Implement a global sourcing 1,050 strategy to reduc
Slide 119: CREDO II – next wave of IT-infrastructure optimization
D. Delivering the Best of Allianz CREDO II1 - next wave of IT-Infrastructure optimization to deliver further EUR 160mn annual savings by 2011 ASIC SE Migration to ASIC SE Allianz Shared Infrastructure Services SE Status 01/2007 Current 02/2009 Target Status 2011 55 Data Centers 13 OE's 50% compl
Slide 120: Operational excellence gives strategic flexibility
D. Delivering the Best of Allianz Our continued focus on operational excellence gives us the strategic flexibility to … 1 … produce consistent productivity gains in an unpredictable economic environment 2 … generate investment capacity to upgrade our sales and service capabilities 3 … over time beco
Slide 121: Capital and investment discipline
Paul Achleitner, Member of the Board of Management Capital and investment discipline Analysts’ conference February 2009
Slide 122: Agenda
Agenda Capital management Investment approach Portfolio overview Macro view Summary © Allianz SE 2009 E2
Slide 123: Financing + investment highlights 2008
E. Capital and investment discipline Financing + investment highlights 2008 2008 Jan Feb Mar Apr May Jun Jul Aug Sep Oct Nov Dec Financing USD 2.0 bn hybrid bond EUR 1.5bn senior bond EUR 0.2bn from exercise of warrants issued in 2005 Redemption/ EUR 4.5bn final repayment of bridge loans Investments
Slide 124: Capital structure with prudent use of leverage
E. Capital and investment discipline Capital structure with prudent use of leverage Debt / Equity ratio1 7.9 7.9 7.2 9.3 5.3 24.4% 17.9% 13.9% 20.6% 18.5% 37.7 47.0 56.8 51.4 37.2 10.5 9.7 9.0 12.2 8.6 2004 2005 2006 2007 2008 © Allianz SE 2009 Equity Hybrid bonds Senior debt Debt / Equity ratio 1)
Slide 125: No significant near-term refinancing requirements
E. Capital and investment discipline No significant near-term refinancing requirements Outstanding bonds1 Maturity structure1 (EUR bn) (EUR bn) 15.4 5.9 13.5 12.7 7.9 7.9 9.3 1.3 2.0 0.5 1.5 1.5 6.2 0.9 1.0 4.3 4.2 0.3 0.5 2006 2007 2008 2009 2010 2011 2012 2013 2016 2020 2022 2025 Perpetual © Allia
Slide 126: Agenda
Agenda Capital management Investment approach Portfolio overview Macro view Summary © Allianz SE 2009 E6
Slide 127: Investment strategy determined by liability cash flows and product design
E. Capital and investment discipline Investment strategy is determined by expected liability cash flows (P/C) and product design (L/H) “Optimize free cash flow based on insurance liabilities, product requirements, capital constraints, and Group targets” P/C L/H Liability cash flows are stochastic
Slide 128: Strategic asset allocation differs by segment and products
E. Capital and investment discipline Strategic asset allocation differs by segment and by products – examples: P/C Stochastic liability cash flows Allocation into RoRAC Going concern optimal portfolio Investments are a line of business SAA is fully diversified Group SAA dominates OE SAA
Slide 129: Value proposition of investments: capital efficiency through diversification
E. Capital and investment discipline The value proposition of investments: enhancing capital efficiency through diversification Example ADAG1 P/C Actuarial risk stand alone … RoRAC optimal SAA 80% Fixed income 15% Equity 5% Real estate Enterprise risk … 100% 65% … before … diversified 100% div
Slide 130: Tactical asset allocation: more balanced risk-taking
E. Capital and investment discipline Tactical asset allocation: shift in investment strategy from concentrated to more balanced risk-taking General account risk profile Strategy implementation 2004 High quality fixed income portfolios to match cash flow requirements Low exposure to corporate cre
Slide 131: Tactical asset allocation: successful equity exposure management
E. Capital and investment discipline Tactical asset allocation: successful equity exposure management (not including tax benefits) Example: Allianz Group 2004 – 2008 (EUR bn) Example: German insurance (ADAG) (underlying Ø equity investments of EUR 59bn) Equity divestments 30.6.2007 – 31.12.2008 23.5
Slide 132: Agenda
Agenda Capital management Investment approach Portfolio overview Macro view Summary © Allianz SE 2009 E 12
Slide 133: Overview investment portfolio
E. Capital and investment discipline Overview investment portfolio1 Group investments and loans Focus of portfolio discussion (as of 31.12.2008) Quality of fixed income portfolio Total EUR 365bn Sovereign risks Subordinated bank debt Real estate2 Cash / Other3 2% 2% ABS, structured credit
Slide 134: High quality fixed income portfolio
E. Capital and investment discipline 87% High quality fixed income portfolio Investment portfolio By type of issuer Total By rating EUR 315.8bn Government 35% AAA 50% Pfandbrief & Covered bonds 27% AA 12% Corporate 15% A 26% Banks 8% BBB 6% ABS/MBS1 6% Non-investment grade 1% Other2 9% Not rated 5%*
Slide 135: Fixed income portfolio – limited valuation issues
E. Capital and investment discipline Fixed income portfolio – limited valuation issues Assets FV/AC1 2008 Aggr. 5-yr. impairments impairment EUR bn (%) EUR mn EUR mn Government 110.4 104% 0 0 Covered bonds 85.2 103% 0 0 Impairments 2008 Corporate 46.0 93% -77 -227 Lehman -194 Banks 26.3 92% -283 -28
Slide 136: Government bond allocation concentrated in G7 countries
E. Capital and investment discipline 30% Government bond allocation concentrated Investment in G7 countries portfolio By country Total By rating EUR 110.4bn1 Germany 22% AAA 46% Italy 20% AA 14% France 13% A 36% Spain 5% BBB 2% UK 1% Non-investment grade1% Rest of Europe 27% Not rated 1% USA 4% Rest
Slide 137: Exposure to CEE sovereign risk mostly business driven
E. Capital and investment discipline 1% Exposure to CEE sovereign risk mostly Investment business driven portfolio Counterparty CEE Governments of which by (in EUR bn) exposure local Allianz entity Hungary 0.9 0.7 Poland 0.9 0.3 Slovakia 0.7 0.7 Czech Republic 0.7 0.4 Russia 0.2 0.1 Croatia 0.1 0.1
Slide 138: Fixed income portfolio – Covered bonds
E. Capital and investment discipline 23% Fixed income portfolio – Covered bonds Investment portfolio By country of collateral pool Total By rating EUR 85.2bn Germany 69% AAA 91% Spain 13% Public AA 6% France 6% 26% A 2% UK 3% BBB 0% Ireland 2% Non-investment grade 0% Mortgage Switzerland 1% 43% Not
Slide 139: Fixed income portfolio – Corporate
E. Capital and investment discipline 13% Fixed income portfolio – Corporate Investment portfolio By region Total By rating EUR 46.0bn Eurozone 39% AAA 7% Europe ex Eurozone 10% AA 15% USA 42% A 37% Rest of World 9% BBB 28% Non-investment grade 2% Not rated2 11% By segment (EUR bn) Net AFS unrealized
Slide 140: Fixed income portfolio – Banks
E. Capital and investment discipline 7% Fixed income portfolio – Banks … Investment portfolio By country Total By rating EUR 26.3bn Germany 13% AAA 9% UK 13% AA 28% France 10% A 57% Italy 8% BBB 5% Rest Eurozone 20% Non-investment grade 0% Europe ex Eurozone 6% Not rated 1% USA 20% Rest of World 10%
Slide 141: Limited exposure to Tier 1 bank debt
E. Capital and investment discipline 3% … thereof limited exposure to Tier 1 Investment bank debt portfolio Lower Tier 2 Upper Tier 2 Tier 1 Comments Lower Tier 2 assets have fixed maturities < 10 years and man- datory coupons Upper Tier 2 assets generally have deferr- able, but not cancel- able
Slide 142: Fixed income portfolio – ABS
E. Capital and investment discipline 6% Fixed income portfolio – ABS Investment portfolio By type of category Total By rating EUR 20.5bn U.S. Agency 37% AAA 97% CMBS 26% AA 1% RMBS 15% A 1% Credit Card 5% BBB 0% Auto 3% Non-investment grade 0% Other1 14% Not rated 1% By segment (EUR bn) Net AFS unre
Slide 143: High quality CMBS, RMBS and low structured credit exposure
E. Capital and investment discipline 2% High quality CMBS, RMBS and Investment low structured credit exposure portfolio 2009 CMBS RMBS Structured credit CDOs from Dresdner acquired in 2009 USA CLO 2008 vintage vintage Other 3% 7% 2005 2007 2007 and prior CDO 23% 2001 18% 38% NL 21% Rest of 39% RMBS
Slide 144: Equity portfolio
E. Capital and investment discipline 9%1 Equity portfolio Investment portfolio By regions Total By industry Germany 23% EUR 33.8bn* Financials 23% Eurozone Other 18% ex Germany 42% Consumer 17% Europe ex Eurozone 14% Funds 13% NAFTA 7% Basic materials 9% Utilities 8% Rest of World 14% Industrial 6%
Slide 145: Group equity gearing
E. Capital and investment discipline Group equity gearing (EUR bn) Reconciliation of net equity exposure Equity gearing (as of 31/12/2008) 37.01 0.53 5.1 0.6 0.8 0.7 0.6 0.5 0.1 29.5 25.4 23.6 23.3 -16.1 24.7 -4.6 12.6 -2.5 12.6 -1.2 3.5 0.1 -10.7 0.4 4.7 6.5 3.9 Gross Policy- Def. Hedge Econ. Net 2
Slide 146: Hedging programs for concentrated bank risk
E. Capital and investment discipline 2% Hedging programs for concentrated bank Investment risk in place and in the money portfolio Bank equity exposure as of 31.12.2008 (EUR bn) Stakes underpin bancassurance agreements 5.5 15% of insurance revenues from Unrealized bancassurance gains 3.8 EUR 2bn
Slide 147: Private equity portfolio
E. Capital and investment discipline 1% Private equity portfolio Investment portfolio Direct investments Total Indirect investments Total by regions (%) EUR 0.6bn1 by regions (%) EUR 2.5bn1 Germany 38% Germany 7% Eurozone Eurozone ex Germany 7% ex Germany 32% Europe Europe ex Eurozone 53% ex Eurozon
Slide 148: Private equity market down – but we got the cycle right
E. Capital and investment discipline 1% Private equity market down – Investment but we got the cycle right portfolio Example direct private equity 2004 – 2008 (EUR bn) Successful divestment program 2004 – 2008: 2.1 - Tank & Rast - Messer Griesheim 1.0 - Hansen - Four Seasons - Bartec Investment In
Slide 149: Real estate portfolio
E. Capital and investment discipline 2%1 Real estate portfolio Investment portfolio By regions Total By sectors EUR 16.4bn2 France 32% Office 66% Germany 26% Residential 21% Switzerland 15% Retail 6% Rest of Europe 22% Other / mixed 7% Rest of World 5% By currency Net unrealized gains / losses3 (EUR
Slide 150: Real estate exposure reduced at market peak
E. Capital and investment discipline 2%1 Real estate exposure reduced at market peak Investment portfolio Major transactions Sales proceeds Year Germany EUR 3.0bn 2007 / 2008 France EUR 1.2bn 2005 – 2008 Austria EUR 0.5bn 2006 DreBa Portfolio EUR 2.0bn 2005 (sale & lease back) Total disposal gain of
Slide 151: Agenda
Agenda Capital management Investment approach Portfolio overview Macro view Summary © Allianz SE 2009 E 31
Slide 152: Macro view scenarios
E. Capital and investment discipline Macro view scenarios Short-term Medium-term Upside: “Flash in the Positive impact of fiscal measures “1930” Severe economic depression pan” Successful quantitative easing Very high unemployment No deflation tendency Strong price deflation Return of
Slide 153: Increasing probability of tail risks leaves diversification as best tool
E. Capital and investment discipline Increasing probability of tail risks leaves diversification as the most effective risk management tool “Yes we “1930” “Japan” “Argentina” Keynes” Comments Depression Deflation Reflation (Hyper-)Inflation Equities Valuation not extremely cheap Long-dated Govies
Slide 154: Agenda
Agenda Capital management Investment approach Portfolio overview Macro view Summary © Allianz SE 2009 E 34
Slide 155: In summary – well positioned to weather the storm
E. Capital and investment discipline In summary – well positioned to weather the storm 1 Strong capital position 2 No short-term refinancing requirement 3 Well-diversified investment portfolio 4 Solid underlying operating performance 5 Sustainable business model 6 Relative competitive strength © All
Slide 156: Glossary
Glossary Analysts’ conference February 2009
Slide 157: Glossary (1)
Glossary (1) ADAG Allianz Deutschland AG AFS Securities available for sale AGCS Allianz Global Corporate & Specialty AGI Allianz Global Investors AIM Allianz Investment Management ALM Asset liability management AM Asset Management ART Allianz Risk Transfer Asset-backed securities Asset-backed securi
Slide 158: Glossary (2)
Glossary (2) CEE Central and Eastern Europe CFI Customer Focus Initiative Collateralized debt obligation A structured debt instrument that securitizes securities such as bonds, loans, asset-backed securities (CDO) or credit default swaps. CDOs break up into various tranches, with senior tranches off
Slide 159: Glossary (3)
Glossary (3) Earnings per share (EPS) Ratio calculated by dividing the consolidated profit or loss for the year by the average number of shares (basic/diluted) issued. For calculating diluted earnings per share the number of shares and the profit or loss are adjusted by the dilutive effects of any r
Slide 160: Glossary (4)
Glossary (4) GPW Gross premiums written: Total premiums for insurance contracts (including investment products) written during a specific period, without deducting premiums ceded Gross/Net In insurance terminology the terms “gross” and “net” mean before and after consideration of reinsurance, respec
Slide 161: Glossary (5)
Glossary (5) MBS Mortgage backed securities: Securities backed by mortgage loans MCEV Market Consistent Embedded Value is a measure of the consolidated value of shareholders’ interest. The Market Consistent Embedded Value is defined as Net asset value (NAV) + Present value of future profits where pr
Slide 162: Glossary (6)
Glossary (6) OTP Operational Transformation Program P/C Property and casualty insurance Premiums written/earned Premiums written represent all premium revenues in the year under review. Premiums earned represent that part of the premiums written used to provide insurance coverage in that year. In th
Slide 163: Glossary (7)
Glossary (7) Run-off ratio Run-off ratio is calculated as run-off result in percent of net premiums earned SAA Strategic asset allocation SE Societas Europaea (European company) Statutory premiums Represent gross premiums written from sales of life insurance policies, as well as gross receipts from
Slide 164: Appendix
Appendix Analysts’ conference February 2009
Slide 165: Investor Relations contacts
Investor Relations contacts Oliver Schmidt +49 89 3800-3963 Reinhard +49 89 3800-17224 Lahusen Head of E-mail: E-mail: Investor Relations oliver.schmidt@allianz.com reinhard.lahusen@allianz.com Susanne Arheit +49 89 3800-3324 Christian +49 89 3800-3892 Lamprecht E-mail: E-mail: susanne.arheit@allian
Slide 166: Financial calendar
Financial calendar March 13, 2009 Annual Report 2008 April 29, 2009 Annual General Meeting May 13, 2009 1st quarter results 2009 August 7, 2009 2nd quarter results 2009 November 9, 2009 3rd quarter results 2009 February 25, 2010 Financial press conference for the 2009 fiscal year February 26, 2010 A
Slide 167: Disclaimer
Disclaimer These assessments are, as always, subject to the disclaimer provided below. Cautionary note regarding forward-looking statements The statements contained herein may include statements of future expectations and other forward-looking statements that are based on management’s current views