The FINANCIAL -- Allianz in Central and Eastern Europe (CEE) on March 10 reported solid results for fiscal year 2009, despite a challenging market environment in the region.

"Based on preliminary figures, total gross premiums written in the region recorded 3.6 billion euros. Comparing to 4.2 billion euros in 2008 and adjusted for the devaluation of Central and Eastern European currencies, this is a decrease by 2 percent. Operating profit for 2009 decreased by 12 percent to 306 million euros versus 348 million euros in 2008," Allianz reported.

"We performed well in the difficult economic environment of 2009. Both, our premiums and operating profit are within our expectations, despite volatile exchange rates. CEE remains an important growth region for Allianz. We have been in this region for more than 20 years now and we continue to be a trusted partner for our customers in future," said Werner Zedelius, Member of the Board of Management of Allianz SE responsible for growth markets.

Property and Casualty Insurance: low combined ratio remains stable

Gross premiums written in the Property and Casualty insurance in 2009 decreased by 14 percent to 2.6 billion euros, compared to 3.0 billion euros in the respective period in 2008.

On internal basis, premiums from Property and Casualty insurance decreased slightly by 3 percent in 2009. However, adjusted for foreign currency effects, premiums still amount to 3.0 billion euros. Year-on-year, operating profit in 2009 decreased by 23 percent to 230 million euros, versus 300 million euros in 2008.

Despite the instable environment results in the Property and Casualty insurance were solid. The results were mainly driven by the decrease of new business in motor insurance along with a severe decline in new car registrations in the CEE region in 2009. Operating profit was impacted by increased claims pressure in the Motor segment due to unfavourable exchange rates resulting in significantly increased prices for foreign spare parts.

Still, the combined ratio remained at a competitive level of 92.9 percent in 2009 just as in the previous year. “The support of all employees and strategic initiatives implemented in the past years have helped to protect our combined ratio in this time of economic downturn. All Allianz companies in the region have managed to keep expenses down, thereby reinforcing our level of profitability,” said Manuel Bauer, regional CEO of Allianz in Central and Eastern Europe.

Life and Health Insurance: growth in premiums and operating profit continues

The Life and Health business in CEE declined in the full year 2009 including exchange rate effects by 9 percent to 1.0 billion euros compared to 1.1 billion euros in the same period of 2008. Adjusted for currency effects, statutory premiums in the Life and Health insurance business in 2009 grew by 2 percent to 1.2 billion euros. Annual operating profit even increased by 59 percent to 76 million euros, compared to 48 million euros in 2008. With net inflows of 100 million euros, Allianz in CEE contributed positively to Allianz Group’s overall performance.

The strong result in the Life and Health business was driven by a shift from unit-linked to traditional life products. With this development Allianz in CEE defended its strong position in the region.

Manuel Bauer: "The development of this segment is particularly gratifying. Life insurance clients are looking for a safe haven in an unstable market. That safe haven is Allianz. In addition, this strong development of operating profit shows that the business fundamentally is rock solid."

Pension Fund and Asset Management business booms

In CEE, Allianz continued to strengthen its leading position in the Pension Fund and Asset Management business. Third-party assets under management grew by 28 percent to 6.5 billion euros, compared to 5.1 billion euros at the end of 2008. Stable net cash inflows and recovery on the capital markets in the CEE region were the drivers for this positive development.

Outlook

Werner Zedelius: "In the mid- to long term we again expect growth rates of five percent or higher in Central and Eastern Europe. Our target remains to grow at a rate at least equal to that of the individual CEE economies. Given the trust Allianz has earned and the financial strength we continuously demonstrate, I am convinced that we will continue our success story in Central Eastern Europe."

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