Published: April 13, 2010
A.M. Best Affirms Ratings of Allianz Societas Europaea and Its Main German Subsidiaries
LONDON - (BUSINESS WIRE) - A.M. Best Co. has affirmed the financial strength rating (FSR) of
A+ (Superior) and issuer credit ratings (ICR) of "aa" of Allianz
Societas Europaea (Allianz SE) (Germany) and its main German
subsidiaries. The outlook for all ratings is stable. (See below for a
complete listing of companies and debt instruments.)
The ratings of Allianz SE reflect its very strong business position and
strong capitalisation. Financial performance improved significantly in
2009 following better investment performance and a stable operating
profit.
While Allianz SE's operating profit remained relatively stable in 2009,
the group's net income improved significantly to EUR 4.3 billion (EUR
2.2 billion loss in 2008 due to depressed financial markets and the
disposal of Dresdner bank). Life operating profits improved by 132% to
EUR 2.8 billion following recovering investment income and improving
performance of the US book of business. A.M. Best believes that life
financial performance will be relatively stable in 2010 and will remain
the main contributor to the company's operating profit in the short
term. Allianz SE's non-life operating profit deteriorated by 28% to EUR
4 billion in 2009 following declining investment and technical
profitability, which resulted from increased claims in personal lines of
business in Continental Europe and ongoing poor results in credit
insurance. A.M. Best believes that the slowly hardening rates will
continue to be constrained by lower demand and expects the group's
combined ratio to remain between 95% and 97% in 2010. The remaining
businesses of Allianz SE (asset management, corporate and others) are
likely to have a limited impact on the company's 2010 financial results
following the reduced size of the banking activities.
Allianz SE's shareholders' equity increased by 19% to EUR 40.2 billion
in 2009. The enhanced earnings and higher value of in-force business
(VIF) resulted in a strengthening in the group's risk-adjusted
capitalisation. The sale of Dresdner Bank at the end of 2008 resulted in
a de-leveraging of the group and improved the company's financial
flexibility. A.M. Best believes the company's risk-adjusted
capitalisation will remain strong in 2010 and 2011 and will be driven by
the dividend policy and investment performance.
Allianz SE has a very strong business position, mainly in Continental
Europe and especially in Germany, Italy and France. The group's revenues
increased by 5% to EUR 97.4 billion in 2009, driven by double digit
growth in life and health premiums and asset management income.
Statutory life premiums were up 11% and benefitted from increased demand
for products with minimum guarantees and participating components
especially in Italy, Germany and Asia Pacific. Non-life premiums
experienced another year of slight decrease in 2009 as the declining
business in many mature markets could not be completely offset by
increasing premiums in Asia Pacific, travel insurance and inwards
reinsurance. A.M. Best believes that reported life premiums are likely
to continue to grow moderately in 2010 due to ongoing demand for
products with embedded guarantees and healthcare covers. Despite rates
hardening in some non-life business lines, premium volumes are likely to
remain constrained by lower demand for both individual and commercial
insurance products due to ongoing difficult global economic conditions.
The FSR of A+ (Superior) and ICRs of "aa" have been affirmed for Allianz
SE and its following main German subsidiaries:
-
Allianz Lebensversicherungs-AG
-
Allianz Versicherungs-AG
-
Allianz Private Krankenversicherungs-AG
-
Euler Hermes Kreditversicherungs-AG
The ICR of "aa" has been affirmed for Allianz France S.A.
The following debt ratings have been affirmed:
Allianz Finance II B.V. (guaranteed by Allianz SE)-
-- "aa" on EUR 0.9 billion 5.625% senior unsecured bonds, due 2012
-- "aa" on EUR 1.5 billion 4.0% senior unsecured bonds, due 2016
-- "aa" on EUR 1.5 billion 5.0% senior unsecured bonds, due 2013
-- "aa-" on EUR 2 billion 6.125% senior subordinated bonds, due 2022
-- "aa-" on EUR 1 billion 6.5% senior subordinated bonds, due 2025
-- "aa-" on EUR 1.4 billion 4.375% undated junior subordinated bonds
-- "aa-" on EUR .800 billion 5.375% undated subordinated bonds
-- "aa-" on USD .500 billion 7.25% perpetual subordinated bonds
Allianz SE-
-- "aa-" on USD 2 billion 8.375% undated subordinated bonds
-- "aa-" on EUR 1.5 billion 5.5% perpetual junior subordinated bonds
Allianz France S.A.-
-- "a+" on EUR 0.4 billion 4.625% junior subordinated bonds, due 2015
For Best's Credit Ratings, an overview of the rating process and rating
methodologies, please visit www.ambest.com/ratings.
The principal methodologies used in determining these ratings, including
any additional methodologies and factors that may have been considered,
can be found at www.ambest.com/ratings/methodology.
Founded in 1899, A.M. Best Company is a global full-service credit
rating organization dedicated to serving the financial and health care
service industries, including insurance companies, banks, hospitals and
health care system providers. For more information, visit www.ambest.com.
A.M. Best Co.
Analysts
Charlotte Vigier, +(44) 20 7626 6264
charlotte.vigier@ambest.com
or
Maik
Stolle, +(44) 20 7626 6264
maik.stolle@ambest.com
or
Public
Relations
Rachelle Morrow, +(1) 908-439-2200, ext. 5378
rachelle.morrow@ambest.com
or
Jim
Peavy, +(1) 908-439-2200, ext. 5644
james.peavy@ambest.com
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