Moving forward. Michael Diekmann Chief Executive Officer. BoA Merrill Lynch Banking and Insurance CEO Conference London, September 2013

Transcription

1 Moving forward Michael Diekmann Chief Executive Officer BoA Merrill Lynch Banking and Insurance CEO Conference London, September 2013

2 Agenda 1 Allianz at a glance 2 Key topics 2.1 Interest rates 2.2 Capital 2.3 Growth 3 Outlook 2

3 1. Allianz at a glance Allianz at a glance Segments 1,5 Operating profit in % Regions 1,5 Operating profit in % EUR 106bn total revenues 1 AM P/C Emerging markets Germany EUR 1,863bn total AuM 2 EUR 9.3bn operating profit 1 206% economic solvency ratio 2 28% Specialty insurance 9% 6% 24% 177% regulatory solvency ratio 2,3 EUR 47.9bn S/H equity 2 28% 44% 31% 30% EUR 49.4bn market cap 4 About 78mn (direct) and 250mn (indirect) customers 1 L/H 1) 2012, operating profit adjusted for reclassification of restructuring expenses and IAS19 2) 06/2013 3) Off-balance sheet reserves are accepted as eligible capital only upon request; Allianz SE has not submitted an application so far. Excluding off-balance sheet reserves, the solvency ratio would be 168 % 4) 08/2013 5) Relation of business segments excluding Corporate & Other and consolidation Broker markets US, UK, AUS Western Europe 3

4 1. Allianz at a glance Strong market positions and brands 1 Leading P/C insurer globally Top 5 Life insurer globally Unlimited access to business opportunities Top 5 asset manager globally Largest global assistance provider Worldwide leader in credit insurance One of the leading industrial insurers globally Building the leading global automotive provider 1) All rankings based on 2012 data 4

5 1. Allianz at a glance For the last 10 years we have been strengthening Capital strength Delivery Multi-access Platform reduction Digitalization De-risk Multichannel distribution Consolidate Reinsurance Sale of Dresdner Allianz = Insurance + Investments Simplify Allianz Investment Management (AIM) Target Operating Model (TOM) & Customer Focus & One Brand Global Lines Minority buy-outs, complexity reduction 5

6 1. Allianz at a glance our ability to deliver even in a challenging environment Healthy growth potential Resilient business model Strong capital base 6

7 1. Allianz at a glance First half 2013 a good start into the year M 6M M 6M Group Total revenues (EUR bn) % 58.8 P/C (EUR mn) 2, % 2,498 CR 1.1% 96.7% 95.1% 2.4% 3.0% 3.6% NatCat impact Run-off ratio Group Operating profit (EUR mn) +12.7% 5,164 4,583 L/H (EUR mn) 1, % 1,524 NBM 1.8% 1.8% Group Shareholders net income (EUR mn) +25.3% 3,295 2,629 AM (EUR mn) 3rd party net flows (EUR bn) +43.4% 1,704 1,

8 Agenda 1 Allianz at a glance 2 Key topics 2.1 Interest rates 2.2 Capital 2.3 Growth 3 Outlook 8

9 2.1 Interest rates Diversification reduces interest rate sensitivity Stable operating profit in a volatile environment / m 2013 Operating profit (EUR bn) e thanks to diversification Operating profit by business segment (%) ) Historically reported figures excluding Banking segment 2) Based on historically reported figures excluding Corporate & Other, Banking and Consolidation 3) 2011 and 2012 including adjustments for restructuring charges and IAS 19 restatement 3 3 1H 2013 AM L/H P/C 9

10 2.1 Interest rates Lower yields mitigated by growing asset base, Interest and similar income plus AM fee and commission income 1 (EUR bn) Growth in operating asset base CAGR 6.0% % 6.9% 0.6% AM L/H P/C 2012 CAGR 1) AM: excluding performance fees; L/H: before policyholder participation 10

11 2.1 Interest rates strong buffers and resilient margins in L/H Business in force New business 5.0% 2 Current yield 4.4% 1 5.3% 3 270bp ~90bp margin Optimization of assetliability management ~3.1% 150bp Improvement of technical margin Shifting from crediting rate to terminal bonus Fostering of protection business 2.6% ~1.6% Shifting of product mix towards unit-linked business + strong buffer EUR 19bn of RfB equal 5.7% of aggregate policy reserves Total yield 2012 Ømin. guarantee Reinvestment yield F/I 6m 2013 Ø guarantee new business e 1) IFRS current interest and similar income (net of interest expenses) relative to average asset base (IFRS) which excludes unit-linked, FVO and trading 2) IFRS current interest and similar income (net of interest expenses) relative to average aggregate policy reserves 3) IFRS current interest and similar income (net of interest expenses) + net harvesting and other (operating) relative to average aggregate policy reserves 4) Weighted by aggregate policy reserves 11

12 2.1 Interest rates Example Allianz Leben Germany Duration Fixed income and minimum guarantee cash flows Minimum guarantee cash flows Fixed-income cash flows (maturity + coupon) Carry forward of asset surplus Assets 2012 Liabilities years Limited interest rate sensitivity of economic balance sheet Cash flows from existing fixed income investments allow full coverage of liability cash flows for comfortable period of time 12

13 2.1 Interest rates Higher yields with positive net impact on operating profit Operating profit after 100bps interest rate increase (EUR mn) 1,600 1,400 1,200 1, Full run-rate EUR 1.6bn 6y run-rate EUR 1.4bn 6y cumulative benefit: EUR 4.5bn AM 6% L/H 28% Corporate 8% P/C 58% P/C: Immediate substantial positive impact due to relatively short duration L/H: Positive effect of higher interest income mitigated by possible ZZR unwind AM: Higher yields offset lower asset levels Corporate: Negative impact of higher coupons and interest costs offset by higher interest income and lower pension costs yrs. Disclaimer: Simplified assumptions - No impact on operational business - Unchanged risk appetite reg. reinvestments - L/H excl. impact on derivatives / DAC and trading liabilities (one-off) - Positive effects on MCEV / NBM excluded 13

14 2.1 Interest rates PIMCO AuM grew even in times of increasing interest rates 3.82% End %-p % % Mid %-p % End % % End ,221 1,348 1, % Mid , H13 5 Why resilience? Fixed income favored by regulation, income seeking investors (age 50+) or funds and ALM management Ongoing diversification into other asset classes and non-traditional products (now > 60%) with higher revenue margins Growth opportunities in Europe / Asia Higher yields increase accumulated interest income Higher yields ultimately lead to more attractive F/I product US treasury benchmark bond 10 years 6 3rd party AuM (USD bn) 1) compared with ) compared with ) AuM: USD 569bn as of compared with 322bn as of ) AuM: USD 976bn as of compared with 700bn as of ) New organizational setup 6) Source: Thomson Reuters, Bloomberg 14

15 Agenda 1 Allianz at a glance 2 Key topics 2.1 Interest rates 2.2 Capital 2.3 Growth 3 Outlook 15

16 2.2 Capital Uncertain regulatory requirements Solvency II Implementation date Treatment of long-term guarantees Equivalence Volatility adjustment Systemicness Capital, disclosure and other potential regulatory requirements Interaction with Solvency II Accounting IFRS 4 Phase II Valuation of liabilities at current fulfillment value Product regulation MIFID II IMD II PRIPs 16

17 2.2 Capital require strong and resilient capital base Shareholders equity (EUR bn) 1H Interest rates +100 bps -4.9 Equity markets -30% -2.1 Economic solvency (%) AA (stable outlook) 1H Interest rates -100 bps Equity markets -30%

18 2.2 Capital Strong capitalization and risk management pay off S&P financial strength rating / outlook 1 S&P enterprise risk management (ERM) AA AA AA AA- Very strong Highest possible rating, best in class 2 AA- AA- A+ A+ A+ Recognition of internal capital model by S&P A A A A- A- A H ) Insurer Financial Strength Ratings of holding companies or operating entities; positive/stable/negative outlooks indicated by green/yellow/red arrows; credit watch categorized in the same way as outlook 2) Axa, Zurich: strong, Generali adequate Higher S&P capital surplus Lower cost of capital Funding costs reduced versus peers 18

19 2.2 Capital Derisking Life product innovation New traditional Hybrid products Unit-linked products Germany Perspektive (July 2013) Total premium refund guarantee at maturity Yearly increase of maturity benefit Annuitization of maturity benefit only at rates at time of annuitization Significantly reduced interest rate risk Switzerland Balance Invest (2012) Customer can choose between guarantee level of % Upside linked to market performance of underlying funds Risk riders included as standard components 34% 1 share in Individual Life new business (6% share in total Life) Italy Progetto Reddito (2013) Unit linked decumulation product Mandatory withdrawals of min. 1% each quarter Tax advantage: capital gains tax will not arise until the paid-in capital is completely used up Share of unit-linked products in Italy 71% 1 (GPW) NBM ~2% NBM 4.7% 1 NBM 2.2% 1 1) 6m

20 2.2 Capital Transparent dividend policy 1 Continuity % % 40% 40% 40% Dividend per share in EUR Payout ratio 2 Payout ratio 20 Internal growth Dividend 40 Net income 2 20 External growth 20 Shift of investments to real assets Dividend growth to be achieved through increase of net income 1) High ratio to compensate for non-operating impairments 2) Net income attributable to shareholders 20

21 2.2 Capital Disciplined acquisition strategy Strengthening of strategic partnership with Banco Popular by bundling of existing joint ventures Acquisition of insurance activities from Mensura Signing of 10-year life insurance distribution agreement with HSBC in continental Europe Acquisition of Gan Eurocourtage brokerage business Signing of 10-year excl. life insurance distribution agreement with HSBC in Asia Acquisition of Yap ו Kredi Sigorta, Turkey plus 15-year excl. bank distribution agreement Focus on smart transactions in regions with strong presence and on distribution capacity in growth regions 21

22 Agenda 1 Allianz at a glance 2 Key topics 2.1 Interest rates 2.2 Capital 2.3 Growth 3 Outlook 22

23 2.3 Growth Profitable growth via enhanced distribution Agency Future Program (AFP) to increase sales productivity Joint effort between distribution, market management and operations to support agents along the value chain Implementation ongoing New model agency productivity versus old model (Jan July 2013) (Change of new business volume in % 1 ) +18% +16% +14% +10% Czech Republic Germany Switzerland Austria 1) Productivity change based on changes of new retail business. New business P/C = GPW of new business; new business Life = weighted premium sum of new business; new business Health = monthly premiums of new business. Values compare productivity of new model agencies vs old model. Values for Germany based on new agencies Pro3 package 2 versus new agencies non-pro3. 23

24 2.3 Growth Growth markets we keep investing 1 Distribution agreement with HSBC Turkey Acquisition Yap ו Kredi Sigorta 4.0% 11.1% Central Eastern Europe & Turkey 26.8% Allianz One China Health JV CPIC China Exclusive distribution agreement with HSBC in 8 countries 6.8% Investments in Iberian platform AGCS in Brazil PIMCO in Brazil Euler / Mapfre 2.4% 3.2% Latin America 0.3% 0.4% Africa, Middle East Asia Revenues Customers As % of total Allianz revenues resp. customers in 2012 Plus Global Lines with special focus on growth markets 1) Customer figures including non-consolidated entities. Revenues Asia including figures of non-consolidated operating entities in India. Data exclude specialty insurers AGCS, Euler Hermes, Allianz Global Assistance and ART 24

25 2.3 Growth Turkey an epitome of selective external growth Impressive organic growth GPW (EUR mn) Many players with unsustainable losses Net income non-life market 2012, local 1,2 (EUR mn) Yap ו Kredi almost doubles our presence GPW (EUR mn) 48% 436 1,059 Loss-maker Σ -428 Profit-maker Σ 145 (228) (34) Yapı Kredi Allianz 1, (33) (28) (24) (20) (16) (11) 3 (9) 2 (7) M M 2013 Non-Life (including Health) Life (Life and Pension) (5) (2) 0.4 Other (11) 1) Source: annual reports and Insurance Association of Turkey; including dividends from subsidiaries (local GAAP figures) 2) Local GAAP figures Note: average F/X rate 2012 EUR/TL Yap ו Kredi AZ Turkey 25

26 2.3 Growth Technology: Telematics, Fastquote, Direct, Fusion In-force portfolio Telematics Italy (on-board units retail, in thousands, cumulative) In-force Fastquote policies Italy (in thousands, cumulative) % > 7x /12 12/12 06/13 06/12 12/12 06/13 Direct volume has almost doubled (EUR mn) 346 6M M 2010 GPW P/C Direct CAGR 18% 480 6M M M 2013 Premium processed via Fusion platform (USD mn) M M 2010 CAGR 37% M M M

27 2.3 Growth Global Automotive is a real growth driver GPW trend Global Automotive (in EUR bn) CAGR 23% CAGR 10% 10% 3.5 Global Automotive bundles the B2B2C automotive business within Allianz on a global scale Allianz is uniquely positioned among its peers with partnerships in Europe, Asia and South America Agreements with more than 45 brands in more than 30 countries e Double-digit top-line growth is expected to continue resulting in EUR 3.5bn GPW by 2016e 27

28 Agenda 1 Allianz at a glance 2 Key topics 2.1 Interest rates 2.2 Capital 2.3 Growth 3 Outlook 28

29 3. Outlook Upper end of target range in reach Operating profit (EUR bn) 6M 2013 Outlook 1 published 02/13 6M % 2 P/C GPW growth 1.7% CR 95.1% L/H 54% Revenue growth 9.0% NBM 1.8% AM 59% Net inflows of EUR 50bn CIR 54.3% CO 50% 2,3-0.6 In line with target % 2 Total (+/- 0.5) Please mind the seasonality of the business and our disclaimer 4! 1) For FY ) As % of target range mid-point 3) Corporate and consolidation 4) Disclaimer: impact from NatCat, financial markets and global economic development not predictable! 29

30 3. Outlook To sum it up Strong market positions and brands Resilient and well diversified business model Natural hedge against interest rate changes Strong capital position Attractive dividend yield 6 Healthy growth potential 30

31 Disclaimer These assessments are, as always, subject to the disclaimer provided below. Forward-looking statements The statements contained herein may include prospects, statements of future expectations and other forward-looking statements that are based on management's current views and assumptions and involve known and unknown risks and uncertainties. Actual results, performance or events may differ materially from those expressed or implied in such forwardlooking statements. Such deviations may arise due to, without limitation, (i) changes of the general economic conditions and competitive situation, particularly in the Allianz Group's core business and core markets, (ii) performance of financial markets (particularly market volatility, liquidity and credit events) (iii) frequency and severity of insured loss events, including from natural catastrophes, and the development of loss expenses, (iv) mortality and morbidity levels and trends, (v) persistency levels, (vi) particularly in the banking business, the extent of credit defaults, (vii) interest rate levels, (viii) currency exchange rates including the Euro/U.S. Dollar exchange rate, (ix) changes in laws and regulations, including tax regulations, (x) the impact of acquisitions, including related integration issues, and reorganization measures, and (xi) general competitive factors, in each case on a local, regional, national and/or global basis. Many of these factors may be more likely to occur, or more pronounced, as a result of terrorist activities and their consequences. No duty to update The company assumes no obligation to update any information or forwardlooking statement contained herein, save for any information required to be disclosed by law. 31

32 Investor Relations contacts Oliver Schmidt Head of Investor Relations Peter Hardy Christian Lamprecht Reinhard Lahusen Stephanie Aldag IR Events Investor Relations Internet English: German: 32