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Allianz says on track to meet 2018 targets as Q1 income rises 6.8% YOY

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Allianz says on track to meet 2018 targets as Q1 income rises 6.8% YOY

Allianz Group said it is on track to meet its 2018 targets as it posted a 6.8% year-over-year increase in first-quarter net income.

The German insurance group reported first-quarter net income attributable to shareholders of €1.94 billion, up from €1.82 billion in the year-ago period. Allianz said the increase was driven by a higher nonoperating investment result, a decrease in restructuring charges and a lower effective tax rate.

EPS for the quarter stood at €4.40, compared to €3.99 a year earlier. Annualized return on equity rose to 13.8% from 11.8%.

Total revenues came in at €36.5 billion, compared to the year-ago €36.2 billion. The cost-to-income ratio improved by 1.4 percentage points to 61.9%.

The group's operating profit fell 6.0% on a yearly basis to €2.76 billion from €2.93 billion. Its property and casualty insurance segment posted operating profit of €1.27 billion, up 1.2% year over year as a higher underwriting result was mostly offset by lower investment income. Claims from natural catastrophes increased, primarily due to European storm Friederike, which caused some €220 million in claims.

Gross written premiums in P&C insurance totaled €17.9 billion, a 1.1% increase from a year earlier. The combined ratio at P&C insurance improved by 0.8 percentage point to 94.8% from 95.6%. Allianz is targeting a combined ratio of 94%.

In the life and health insurance segment, operating profit fell 7.4% to €1.07 billion, reflecting volatile market conditions and foreign-currency translation effects in the U.S. The present value of new business premiums rose to €15.0 billion from €14.7 billion.

The asset management business saw third-party net inflows of €20.9 billion, stemming largely from a €19.2 billion contribution from Pacific Investment Management Co. LLC. Overall, third-party AUM fell to €1.43 billion from €1.45 billion at 2017-end, mainly because of negative foreign-currency translation effects.

The group's Solvency II capitalization ratio stood at 225% at March-end, compared to 229% at 2017-end.