Allianz SE · XETR:ALV
Allianz — Analysts' Conference February 2007
163 slides from Allianz's conference presentation, February 2007
Slide 1: On Track
On Track Analysts’ conference February 2007 Please note: Booklet based on 2006 preliminary figures Not for distribution in the USA
Slide 2: Disclaimer
Disclaimer This presentation is not made and may not be attended from, and these materials may not be distributed or sent into, any jurisdiction where it would be unlawful, including the United States, Canada, Italy and Japan. The distribution of this communication may be restricted by law in certai
Slide 3: Agenda
Agenda Group Financial Results 2006 Helmut Perlet A FIT for Value Generation Paul Achleitner B On Track Michael Diekmann C Embedded Value 2006 Helmut Perlet D Analysts'conference(kp)_FIN Index E Appendix Glossary F 1 Investor Relations contacts F 6 © Allianz SE 2007 Financial calendar 2006/2007 F 7
Slide 4: Group Financial Results
Helmut Perlet, Member of the Board Group Financial Results 2006 Analysts’ conference February 2007
Slide 5: 2006: another year of success…
A. Group Financial Results 2006 2006: another year of success… (EUR m) Quarterly results YTD results CAGR CAGR 15.9% 21.8% 10,386 2,255 8,003 1,906 7,001 Operating 1,679 profit 4Q 04 4Q 05 4Q 06 2004 2005 2006 Analysts'conference(kp)_FIN CAGR CAGR 57.4% 44.7% 7,021 1,372 Net 4,380 872 3,3521 income
Slide 6: …based on sustainable improvements
A. Group Financial Results 2006 …based on sustainable improvements P/C: combined ratio (in %) Dresdner Bank: cost-income ratio (in %) -2.0%-p -8.0%-p Target ‘06 <95% Target ‘06 94.9 91.4 <80% 94.3 87.6 92.9 79.6 2004 2005 2006 2004 2005 2006 Analysts'conference(kp)_FIN L/H: operating profit (EUR m)
Slide 7: Agenda
Agenda 4Q Results Group P/C L/H Banking Analysts'conference(kp)_FIN Asset Management Summary Additional information © Allianz SE 2007 A3
Slide 8: 4Q: growth flat
A. Group Financial Results 2006 4Q: growth flat (EUR bn) Total revenues1 24.3 28.3 23.7 23.8 25.2 29.6 24.1 22.6 24.8 0.8 0.6 1.9 1.7 0.8 0.8 4Q Total Int. 0.6 0.6 0.7 0.7 growth growth2 1.7 0.7 (in %) 1.5 1.4 1.6 1.7 1.8 12.8 1.7 11.9 Total 05 3.8 1.8 13.2 12.1 13.2 11.9 12.8 11.2 9.8 Total 06 -1.5
Slide 9: 4Q: strong operating profit contribution from all segments
A. Group Financial Results 2006 4Q: strong operating profit1 contribution from all segments (EUR m) Business segments 4Q 06 ∆ 4Q 06/05 Property/Casualty Life/Health CAGR CAGR 3.2% P/C 1,311 +25 21.1% 1,286 1,311 698 1,230 L/H 698 +149 476 549 Banking 203 +195 4Q 04 4Q 05 4Q 06 4Q 04 4Q 05 4Q 06 Anal
Slide 10: 4Q: restructuring charges at Dresdner Bank fully booked
A. Group Financial Results 2006 4Q: restructuring charges at Dresdner Bank fully booked Breakdown of non-operating items (EUR m) 4Q 04 4Q 05 4Q 06 ∆ 4Q 06/05 Realized gains/losses 206 383 143 -240 ! Low harvesting in 4Q 06 and impairments of investments (net) ! Other non-operating in 4Q 05 negativel
Slide 11: 4Q: net income improves by 57%
A. Group Financial Results 2006 4Q: net income improves by 57% (EUR m) 4Q 04 4Q 05 4Q 06 ∆06/05 Operating profit 1,679 1,906 2,255 +349 Non-operating items -4241 -112 -628 -516 Income before income 1,2551 1,794 1,627 -167 taxes, minority interests Incl. EUR 0.5bn non-recurring Income taxes tax benef
Slide 12: 4Q - P/C: another strong quarter
A. Group Financial Results 2006 4Q - P/C: another strong quarter (EUR m) Operating profit +1.9% Operating profit drivers 1,845 1,650 1,727 1,286 +118 1,311 1,386 1,311 1,230 1,214 1,286 +70 992 -163 Analysts'conference(kp)_FIN Combined Combined ratio 92.5% ratio 95.0% Operating Under- Operat. Other
Slide 13: 4Q - L/H: continuous strong improvement
A. Group Financial Results 2006 4Q - L/H: continuous strong improvement (EUR m) Operating profit Main drivers 4Q ! Higher operating asset base +27.1% ! Further improved investment margin 723 698 ! Increased technical margin 617 556 549 527 517 476 472 Analysts'conference(kp)_FIN 4Q 1Q 2Q 3Q 4Q 1Q 2Q
Slide 14: 4Q – Dresdner Bank: double-digit profit growth
A. Group Financial Results 2006 4Q – Dresdner Bank: double-digit profit growth for sixth consecutive quarter (EUR m) Operating profit 529 Operating profit drivers 319 311 +223 225 202 209 205 202 +121 -133 Analysts'conference(kp)_FIN -9 -9 Operating Operat. Operat. LLP1 Operating -36 profit revenues
Slide 15: 4Q – Asset Management: double-digit profit growth
A. Group Financial Results 2006 4Q – Asset Management: double-digit profit growth – again (EUR m) Operating profit +13.2% 395 Operating profit drivers 349 300 304 297 294 265 +37 +9 395 252 231 349 Analysts'conference(kp)_FIN Operating Operat. Operat. Operating 4Q 1Q 2Q 3Q 4Q 1Q 2Q 3Q 4Q profit reve
Slide 16: Agenda
Agenda 4Q Results Group P/C L/H Banking Analysts'conference(kp)_FIN Asset Management Summary Additional information © Allianz SE 2007 A 12
Slide 17: Insurance revenues flat – double-digit growth in Banking and AM
A. Group Financial Results 2006 Insurance revenues flat – double-digit growth in Banking and Asset Management (EUR bn) Total revenues1 (in %) Total growth Internal growth2 CAGR: 2.1% 2005 +4.1 +4.2 96.9 100.9 101.1 2006 +0.2 +0.5 2.7 3.0 2.2 6.3 7.1 6.6 AM +11.8 +13.4 Banking +12.2 +12.3 45.2 48.3 4
Slide 18: Strong operating profit growth in all segments
A. Group Financial Results 2006 Strong operating profit growth in all segments (EUR m) Business segments 2006 ∆ 06/05 Property/Casualty Life/Health CAGR CAGR 6,269 14.0% 19.8% P/C +1,127 6,269 2,565 4,825 5,142 2,094 1,788 L/H 2,565 +471 Banking 1,422 +718 2004 2005 2006 2004 2005 2006 Analysts'conf
Slide 19: Non-operating items
A. Group Financial Results 2006 Non-operating items (EUR m) Breakdown of non-operating items 2004 2005 2006 ∆ 06/05 Realized gains/losses 1,346 1,853 2,682 +829 and impairments of ! Higher realized gains investments (net) more than off-set restructuring charges Interest expense -831 -787 -775 +12 fr
Slide 20: High quality pre-tax profit driven by operating profit
A. Group Financial Results 2006 High quality pre-tax profit driven by operating profit (EUR m) 2004 2005 2006 ∆06/05 Operating profit 7,001 8,003 10,386 +2,383 Non-operating items -7931 -174 -63 +111 Income before income 6,2081 7,829 10,323 +2,494 taxes, minority interests Incl. EUR 0.5bn non-recurr
Slide 21: Shareholders' equity increases to EUR 50.5bn
A. Group Financial Results 2006 Shareholders’ equity increases to EUR 50.5bn (EUR m) Shareholders’ equity1 Major movements (EUR bn) +27.8% CAGR: +29.7% ! Unrealized gains/ losses 50,481 - Equities +4.8 - Debt securities -1.6 13,664 39,487 10,324 ! Net income +7.0 29,995 11,419 Unrealized ! Goodwill
Slide 22: Financial conglomerate solvency ratio at 194%
A. Group Financial Results 2006 Financial conglomerate solvency ratio at 194% (EUR bn) Requirements Available funds Solvency ratio Reconciliation of shareholders’ equity and available funds 120% 162% 194%1 Shareholders’ 50.5 equity (31.12.06) 50.5 Proposed dividend -1.6 payment 2007 Goodwill/ 39.3 -
Slide 23: 21.3% return on risk-adjusted capital
A. Group Financial Results 2006 21.3% return on risk-adjusted capital (after minority interest, EUR m) 2006 Avg. RAC1 RoRACN2 Group RoRACN2,3(in %) P/C3 20,582 20.7% +2.7%-p 21.3 18.6 L/H3 7,606 19.9% 16.5 Banking3 7,187 9.2% Analysts'conference(kp)_FIN AM 2004 2005 2006 2,470 41.3% Avg. RAC4 31,216
Slide 24: Corporate segment: details holding function
A. Group Financial Results 2006 Corporate segment: details holding function (EUR m) Holding function 2006 Avg. RAC1 Major components ! “Fixed” Group Center expenses (EUR -337m) Operating ! Defined benefit/ defined contribution plan (EUR -140m) profit -838 ! Project expenses, i.e. consulting, transac
Slide 25: Agenda
Agenda 4Q Results Group P/C L/H Banking Analysts'conference(kp)_FIN Asset Management Summary Additional information © Allianz SE 2007 A 21
Slide 26: P/C: underwriting excellence – 92.9% combined ratio
A. Group Financial Results 2006 P/C: underwriting excellence – 92.9% combined ratio (EUR m) Operating profit CAGR 6,269 Operating profit drivers 14.0% 5,142 6,269 4,825 +173 +408 +546 5,142 Analysts'conference(kp)_FIN Operating Under- Operat. Other Operating profit writing1 inv. income2 profit 2005
Slide 27: P/C: selective use of market opportunities
A. Group Financial Results 2006 P/C: selective use of market opportunities (EUR m) GPW Combined ratio 2004 2005 2006 ∆06/051 Allianz Sach 9,545 9,587 9,539 -0.5% AGF 5,282 5,104 5,110 0.1% Gross premiums written (EUR bn) RAS 3,935 4,039 4,067 0.7% Internal growth: Lloyd Adriatico 1,336 1,329 1,328 -
Slide 28: P/C: tailored local market cycle management
A. Group Financial Results 2006 P/C: tailored local market cycle management Price-volume-analysis 2006 vs. 2005 Volume change Active cycle management +8% established as part of Poland Spain Sustainability Program FFIC “Optimal use of ! Group-wide best practice Suisse opportunities for “Cycle manage-
Slide 29: P/C: excellent combined ratio across all regions
A. Group Financial Results 2006 P/C: excellent combined ratio across all regions (in %) Comb. ratioratio Combined 2004 2005 2006 Combined ratio Allianz Sach 88.5 89.7 92.0 ∆06/05 AGF 100.5 102.0 99.2 94.9 94.3 92.9 -1.4%-p RAS 99.0 97.9 95.7 Lloyd Adriatico 81.5 81.7 80.4 Allianz UK 95.7 96.2 95.7 A
Slide 30: P/C: expenses present opportunity for refinement
A. Group Financial Results 2006 P/C: expenses present opportunity for refinement (EUR m) Acquisition- and administrative expenses Drivers ! Future investments: projects including Sustainability +265 10,590 ! Accelerated accruals 10,216 +1091 10,325 for retirements in Germany and additional pension a
Slide 31: P/C: effective cycle management
A. Group Financial Results 2006 P/C: effective cycle management (in %) Loss ratio YTD ratios 75.0 Impact from Accident year loss ratio Nat Cat of -2.8%-p 7.8%-p 68.8 70.4 67.6 70.4 +1.5%-p 69.7 69.6 69.0 (2y Ø) 67.4 -1.5%-p 68.1 67.9 68.1 65.4 2004 2005 2006 Analysts'conference(kp)_FIN Run-off ratio
Slide 32: P/C: higher yields and growing asset base
A. Group Financial Results 2006 P/C: higher yields and growing asset base combine to grow current income by 9% Average investments & loans (EUR bn) Equity quota1 +4.6% Interest and similar income (EUR m) 91.8 96.1 Other2 8.6 -3.0% 8.4 18.2% 15.6 +17.7% 18.3 19.9% +9.3% Equities 4,096 Other2 3,747 -1
Slide 33: Agenda
Agenda 4Q Results Group P/C L/H Banking Analysts'conference(kp)_FIN Asset Management Summary Additional information © Allianz SE 2007 A 29
Slide 34: L/H: dynamic profit growth continues
A. Group Financial Results 2006 L/H: dynamic profit growth continues (EUR m) Operating profit CAGR 19.8% 2,565 Operating profit driver 2,094 +63 2,565 +220 1,788 +188 2,094 Analysts'conference(kp)_FIN Operating Technical Investment Expense Operating profit margin margin margin profit 2005 2006 2004
Slide 35: L/H: statutory premium growth held back by Italy and US
A. Group Financial Results 2006 L/H: statutory premium growth in Life held back by Italy and US (EUR m) Stat. prem. 2004 2005 2006 ∆06/051 German Life 10,938 12,231 13,009 6.4% Statutory premiums (EUR bn) Internal growth: German Health 3,020 3,042 3,091 1.6% -1.6% AGF 4,719 5,286 5,792 9.6% -1.8% RA
Slide 36: L/H: AZ Life makes progress
A. Group Financial Results 2006 L/H: AZ Life makes progress Operating profit Major actions taken in 2006: (USD m) >6001 ! Company reorganization 527 - New management in place 375 - Regionalization across US 318 entities to leverage synergies ! Initiatives to accelerate revenue growth 2004 2005 2006
Slide 37: L/H: MCEV-profit of EUR 3.7bn
A. Group Financial Results 2006 L/H: MCEV-profit of EUR 3.7bn and… (EUR m) +16.9% 982 348 18,535 2,376 -1,020 15,849 MCEV-profit Analysts'conference(kp)_FIN +3,706 895 risk-free return 1,480 market performance Starting Capital market/ Operating Value of Capital Embedded © Allianz SE 2007 Embedded in
Slide 38: L/H: drivers for future profit growth in place
A. Group Financial Results 2006 L/H: …drivers for future profit growth in place Average operating asset base (EUR bn) New business value (EUR m) Financial assets/liab. carried at fair value1 Unit-linked investments Investments and loans +7.7% +9.2% 982 337.4 9122 309.0 10.2 274.3 7.7 58.3 Analysts'c
Slide 39: L/H investment income: higher yields and growing asset base
A. Group Financial Results 2006 L/H investment income: higher yields and growing asset base drive investment income (EUR bn) Average investments & loans Current yield1 (in %) Interest and similar income +6.2% 13.0 12.1 10.3 10.7 253.2 268.9 4.7 4.8 4.3 3.4 6.7 +8.5% Other3 6.1 1.0 1.6 +26.1% 37.6 Eq
Slide 40: Agenda
Agenda 4Q Results Group P/C L/H Banking Analysts'conference(kp)_FIN Asset Management Summary Additional information © Allianz SE 2007 A 36
Slide 41: Dresdner Bank: it's fixed
A. Group Financial Results 2006 Dresdner Bank: it’s fixed (EUR m) Operating profit Operating profit drivers 1,361 +99 +772 1,361 CAGR 73.1% -140 630 630 Analysts'conference(kp)_FIN 454 Operating Operat. Operat. LLP1 Operating profit revenues expenses profit 2005 ∆ 2006/05 2006 2004 2005 2006 2006 6,
Slide 42: Dresdner Bank: it's growing
A. Group Financial Results 2006 Dresdner Bank: it’s growing (EUR m) Operating revenues Net interest income Net fee & commission Net dealing income1 income +12.8% +19.3% +5.5% +16.5% 6,811 6,357 2,841 6,039 2,645 2,574 2,693 2,264 2,218 1,515 1,301 1,117 Analysts'conference(kp)_FIN 2004 2005 2006 200
Slide 43: Dresdner Bank: it's more productive
A. Group Financial Results 2006 Dresdner Bank: it’s more productive (EUR m) Capital efficiency1 Operating revenues / FTE2 (EUR k) Operating revenues Risk capital Capital efficiency +22.1% 0.74 0.80 0.96 243 8,605 206 199 7,584 7,068 Analysts'conference(kp)_FIN 6,811 6,357 6,039 © Allianz SE 2007 200
Slide 44: Dresdner Bank: it's more efficient
A. Group Financial Results 2006 Dresdner Bank: it’s more efficient (EUR m) 12M cost-income ratio excl. per- Cost-income ratio (in %) formance related expenses1 (in %) YTD 87.6 91.4 79.6 102.4 97.9 93.7 88.6 77.9 81.0 81.0 82.8 82.0 74.4 73.7 63.1 Analysts'conference(kp)_FIN 4Q 1Q 2Q 3Q 4Q 1Q 2Q 3Q 4
Slide 45: Dresdner Bank: it's sound
A. Group Financial Results 2006 Dresdner Bank: it’s sound (EUR m) Non-performing loans Loan portfolio quality2 (in%) Core capital ratio3 (in%) Average portfolio rating VIII VIII VIII +0.8%-p 100% 6,325 31.9 10.0 10.4 38.0 36.0 9.6 Analysts'conference(kp)_FIN 68.1 2,637 64.0 62.0 1,981 © Allianz SE 2
Slide 46: Agenda
Agenda 4Q Results Group P/C L/H Banking Analysts'conference(kp)_FIN Asset Management Summary Additional information © Allianz SE 2007 A 42
Slide 47: AM: consistently delivering double-digit profit growth
A. Group Financial Results 2006 AM: consistently delivering double-digit profit growth… (EUR m) Operating profit CAGR Operating profit drivers 24.0% 1,290 1,132 +322 1,290 1,132 839 -164 Analysts'conference(kp)_FIN Operating Operat. Operat. Operating profit revenues expenses profit 2005 2006 ∆ 2006/
Slide 48: AM: driven by a strong performance track record
A. Group Financial Results 2006 AM: …driven by a strong performance track record… (in %) Fixed income investment performance1 96 96 91 Total investments performance1 89 87 82 4 4 9 2004 2005 2006 + Equity investment performance Analysts'conference(kp)_FIN 1 70 59 43 11 13 18 2004 2005 2006 © Allianz
Slide 49: AM: attracting high net inflows
A. Group Financial Results 2006 AM: …attracting high net inflows… (EUR bn) Fixed income 3rd party net inflows Total 3rd party net inflows1 71.9 44.9 30.8 65.1 2004 2005 2006 + Equity 3rd party net inflows Analysts'conference(kp)_FIN 35.7 36.3 2004 2005 2006 6.4 -4.9 © Allianz SE 2007 -9.6 2004 2005
Slide 50: AM: contributing to a growing asset base
A. Group Financial Results 2006 AM: …contributing to a growing asset base… (EUR bn) 3rd party AuM 3rd party AuM1 - regional breakdown2 CAGR (%) Third-party AuM 764 +14.3 743 743 (as of 31.12.2005) 36 41 +8.2 Internal Other3 63 62 +16.1 growth: 585 Net inflows +36 +10.6% Asia-Pacific 91 112 +29.3 and
Slide 51: AM: very competitive cost-income ratio
A. Group Financial Results 2006 AM: …while maintaining a very competitive cost-income ratio (EUR m) Operating expenses +10.3% Cost-income ratio (in %) 1,754 1,590 1,406 -0.8%-p 2004 2005 2006 62.6 58.4 57.6 ÷ Analysts'conference(kp)_FIN Operating revenues +11.8% 2004 2005 2006 3,044 2,722 2,245 © Al
Slide 52: Agenda
Agenda 4Q Results Group P/C L/H Banking Analysts'conference(kp)_FIN Asset Management Summary Additional information © Allianz SE 2007 A 48
Slide 53: Summary
A. Group Financial Results 2006 Summary ! Another year of great success ! All targets outperformed ! Operating profit exceeds EUR 10bn ! Significant sustainable improvements in all segments Analysts'conference(kp)_FIN © Allianz SE 2007 A 49
Slide 54: Agenda
Agenda 4Q Results Group P/C L/H Banking Analysts'conference(kp)_FIN Asset Management Summary © Allianz SE 2007 Additional information A 50
Slide 55: Group: result by segments overview
A. Group Financial Results 2006 Group: result by segments overview (EUR m) P/C L/H Banking AM Corporate Consolidation Total 12M 05 12M 06 12M 05 12M 06 12M 05 12M 06 12M 05 12M 06 12M 05 12M 06 12M 05 12M 06 12M 05 12M 06 Total revenues 43.7 43.7 48.3 47.4 6.3 7.1 2.7 3.0 0 0 0 0 100.9 101.1 (EUR bn
Slide 56: Group: key figures per quarter
A. Group Financial Results 2006 Group: key figures per quarter (EUR m) 2004 2005 2006 Delta 4Q 1Q 2Q 3Q 4Q 1Q 2Q 3Q 4Q 4Q 06/05 Total revenues (EUR bn) 24.3 28.3 23.7 23.8 25.2 29.6 24.1 22.6 24.8 -0.4 Operating profit 1,679 1,887 2,346 1,864 1,906 2,677 2,794 2,660 2,255 349 Non-operating items -70
Slide 57: Group: breakdown of profit consolidations
A. Group Financial Results 2006 Group: breakdown of profit consolidations (EUR m) Net income 282 511 511 -54 248 Banking 283 Analysts'conference(kp)_FIN 263 L/H Intra-group Gains from Other Total Total dividends sale of consolidations consolidations Munich Re © Allianz SE 2007 (DreBa) 2006 2006 A 53
Slide 58: P/C: key figures and ratios per quarter
A. Group Financial Results 2006 P/C: key figures and ratios per quarter (EUR m) 2004 2005 2006 Delta 4Q 1Q 2Q 3Q 4Q 1Q 2Q 3Q 4Q 4Q 06/05 Gross premiums written (EUR bn) 8.9 14.1 9.6 10.4 9.6 14.1 9.7 10.4 9.4 -0.2 Operating profit 1,230 1,214 1,650 992 1,286 1,386 1,845 1,727 1,311 25 Non-operating
Slide 59: P/C: RoRACN of major OEs
A. Group Financial Results 2006 P/C: RoRACN of major OEs (EUR m, b/min., in %) Risk-adjusted capital1 RoRACN 2005 2006 % 2005 2006 %-p Allianz Sach 4,086 4,548 +11.3 25.2 21.4 -3.8 AGF 2,095 2,173 +3.7 8.0 9.8 +1.8 RAS 2,101 2,261 +7.6 17.1 16.5 -0.5 Lloyd Adriatico 535 527 -1.5 41.7 46.5 +4.8 Allia
Slide 60: L/H: key figures and ratios per quarter
A. Group Financial Results 2006 L/H: key figures and ratios per quarter (EUR m) 2004 2005 2006 Delta 4Q 1Q 2Q 3Q 4Q 1Q 2Q 3Q 4Q 4Q 06/05 Statutory premiums (EUR bn) 13.2 11.9 12.1 11.2 13.2 12.8 11.9 9.8 12.8 -0.4 Operating profit 476 517 472 556 549 723 527 617 698 149 Non-operating items -68 88 37
Slide 61: L/H: RoRACN of major OEs
A. Group Financial Results 2006 L/H: RoRACN of major OEs (EUR m, b/min., in %) Risk adjusted capital1 RoRACN 2005 2006 % 2005 2006 %-p German Life 972 859 -11.6 35.4 37.4 +2.0 German Health 166 168 1.7 39.0 55.4 16.4 AGF 2,263 2,348 +3.7 20.8 22.3 +1.6 RAS 924 935 +1.3 18.3 18.3 0.0 Lloyd Adriatico
Slide 62: Dresdner Bank: key figures and ratios per quarter
A. Group Financial Results 2006 Dresdner Bank: key figures and ratios per quarter (EUR m) 2004 2005 2006 Delta 4Q 1Q 2Q 3Q 4Q 1Q 2Q 3Q 4Q 4Q 06/05 Operating revenues 1,463 1,623 1,330 1,510 1,576 1,884 1,709 1,521 1,697 121 Operating profit -36 209 205 225 -9 529 319 311 202 211 Non-operating items
Slide 63: Dresdner Bank: divisional reporting
A. Group Financial Results 2006 Dresdner Bank: divisional reporting (EUR m) Private & Business Corporate & Corporate Other Clients Investment Banking 2004 2005 2006 2004 2005 2006 2004 2005 2006 Operating revenues 2,974 3,033 3,204 3,005 3,038 3,525 378 -32 82 Operating expenses -2,571 -2,425 -2,455
Slide 64: Asset Management: key figures per quarter
A. Group Financial Results 2006 Asset Management: key figures and ratios per quarter (EUR m) 2004 2005 2006 Delta 4Q 1Q 2Q 3Q 4Q 1Q 2Q 3Q 4Q 4Q 06/05 Operating revenues 608 567 641 710 804 751 726 726 841 37 Operating profit 265 231 252 300 349 304 297 294 395 46 Non-operating items -276 -164 -173 -
Slide 65: Corporate segment: key figures per quarter
A. Group Financial Results 2006 Corporate segment: key figures per quarter (EUR m) 2004 2005 2006 Delta 4Q 1Q 2Q 3Q 4Q 1Q 2Q 3Q 4Q 4Q 06/05 Operating profit -147 -267 -190 -223 -201 -180 -74 -331 -246 -45 Non-operating items -66 -123 -381 -230 -384 -211 184 27 -156 228 Income b/taxes, min. -213 -390
Slide 66: Corporate segment: key figures – breakdown
A. Group Financial Results 2006 Corporate segment: key figures – breakdown (EUR m) Holding function Private Equity Avg.2005 RAC1 2006 ∆ 06/05 RAC1 ∆ 06/05 2005 Avg.2006 Operating revenues 520 612 +92 Operating revenues 658 1,447 +789 Operating expenses -1,443 -1,450 -7 Operating expenses -616 -1,440
Slide 67: Investment result: breakdown per segment
A. Group Financial Results 2006 Investment result1: breakdown per segment (EUR m) P/C L/H Banking AM Corporate Consolidation Group 12M 05 12M 06 12M 05 12M 06 12M 05 12M 06 12M 05 12M 06 12M 05 12M 06 12M 05 12M 06 12M 05 12M 06 Operating investment result 1 Interest and similar income 3,747 4,096 1
Slide 68: Increase in EPS
A. Group Financial Results 2006 Increase in EPS (EUR) EPSA1 – as originally reported EPSA1 – based on IFRS 2006 17.09 17.09 11.24 11.24 8.98 9.16 Analysts'conference(kp)_FIN 2004 2005 2006 2004 2005 2006 © Allianz SE 2007 1) EPS before goodwill amortization. 2004 calculated on pro forma basis (goodw
Slide 69: Development of total equity
A. Group Financial Results 2006 Development of total equity (EUR m) Paid-in capital Revenue Foreign Unrealized Shareholders' Minority Total equity reserves currency gains and equity interests translation losses (net) adjustments Balance as of 31.12.2005 21,616 8,579 -1,032 10,324 39,487 7,615 47,102
Slide 70: Risk capital breakdown
A. Group Financial Results 2006 Risk capital breakdown (b/min., group diversified, EUR bn) Risk capital by risk categories Risk capital by segments ∆ ∆ 36.6 35.8 -2.3% 36.6 35.8 -2.3% Market risk 18.3 17.5 -4.4% PC 18.3 18.0 -1.6% Analysts'conference(kp)_FIN Credit risk 6.2 5.8 -7.1% LH 5.8 5.5 -5.1
Slide 71: Shareholders' share in net off balance sheet reserves
A. Group Financial Results 2006 Shareholders’ share in net off balance sheet reserves (EUR bn) 2005 2006 ∆ 05/06 Off B/S revaluation reserves for investments - Real estate (third party use, own use) 5.2 5.6 0.4 - Associated enterprises/joint venture 0.04 0.04 0.00 - Total 5.2 5.6 0.4 Breakdown of re
Slide 72: Group asset allocation: breakdown per segment
A. Group Financial Results 2006 Group asset allocation1: breakdown per segment (EUR bn) P/C L/H Banking Asset Mgmt. Corporate Consolid. Group Balance sheet items 4Q 05 4Q 06 4Q 05 4Q 06 4Q 05 4Q 06 4Q 05 4Q 06 4Q 05 4Q 06 4Q 05 4Q 06 4Q 05 4Q 06 1 Investments Equities 17.5 19.1 33.0 42.2 3.7 3.7 0.1
Slide 73: Average AuM P/C and L/H: basis for yield calculation
A. Group Financial Results 2006 Average AuM P/C and L/H1: basis for yield calculation (EUR bn) P/C L/H Balance sheet items 31.12.2005 31.12.2006 Avg. 31.12.2005 31.12.2006 Avg. 1 Investments Equities 17.5 19.1 18.3 33.0 42.2 37.6 Debt sec. 53.8 52.3 53.1 140.6 138.8 139.7 2 Other 8.7 7.9 8.4 6.6 6.8
Slide 74: Insurance fixed-income portfolio
A. Group Financial Results 2006 Insurance fixed-income portfolio Credit rating (in %) Duration2 (years) 2005 48 2006 AAA 48 Total 2005 6.1 92% 25 Investment AA Insurance 2006 6.0 17 grade 14 A 22 4 BBB 2005 4.4 5 P/C Analysts'conference(kp)_FIN 2006 4.5 Shareholders‘ share of 100bp shift: EUR 1.3bn
Slide 75: Goodwill
A. Group Financial Results 2006 Goodwill (EUR bn) Goodwill per segment 2005 2.4 L/H 2006 2.4 12.0 +0.4 12.0 2005 1.4 P/C -0.4 2006 1.6 Asset 2005 6.6 Management 2006 6.3 Analysts'conference(kp)_FIN 2005 1.6 Banking 2006 1.6 2005 0 Corporate 2006 0.1 © Allianz SE 2007 Currency Additions Goodwill tran
Slide 76: FIT for Value Generation
Paul Achleitner, Member of the Board FIT for Value Generation Analysts’ conference February 2007
Slide 77: FIT for Value Generation
B. Fit for Value Generation FIT for Value Generation F inancing I nvestments T ransactions Analysts'conference(kp)_FIN © Allianz SE 2007 B1
Slide 78: Financing highlights 2006
B. Fit for Value Generation Financing highlights 2006 2006 2007 Jan Feb Mar Apr May Jun Jul Aug Sep Oct Nov Dec Jan Issuance EUR 800m first undated hybrid retail bond addressing European private investors (D-Basket) EUR 1.5bn first senior issuance since 2002 making use of outstanding market environm
Slide 79: Balanced maturity structure of issued bonds
B. Fit for Value Generation Balanced maturity structure of issued bonds Outstanding bonds1,2 Maturity structure2 In EUR bn In EUR m 15.6 14.5 7.9 7.2 4,479 1.1 450 Analysts'conference(kp)_FIN 6.2 4.7 2,200 2,000 1,632 1,500 900 1,000 1.5 1.5 450 2005 2006 2007 2008 2012 2016 2020 2022 2025 Perpetual
Slide 80: Further enhanced solvency ratio and ratings
B. Fit for Value Generation Further enhanced solvency ratio and ratings Financial conglomerate solvency ratio Financial strength ratings End of End of 2005 2006 194%1 Pro forma1,2 S&P AA- AA- 162% 170% (stable) (positive) Analysts'conference(kp)_FIN 120% AM Best A+ A+ (stable) (stable) Moody’s Aa3 A
Slide 81: FIT for Value Generation
B. Fit for Value Generation FIT for Value Generation F inancing I nvestments T ransactions Analysts'conference(kp)_FIN © Allianz SE 2007 B5
Slide 82: Continuing reduction of equity gearing
B. Fit for Value Generation Continuing reduction of equity gearing (EUR bn) Reconciliation of net equity exposure Equity gearing excluding goodwill Target at 31/12/2006 Corporate 2005 2006 ≤0.6 AM 0.8 0.7 78.5 Banking 40.6 29.3 29.5 9.5 L/H 23.6 0.9 P/C 3.7 Net equity NAV1 Net equity NAV1 exposure e
Slide 83: Enhanced investment portfolio
B. Fit for Value Generation Enhanced investment portfolio Total cluster risks1 reduced Investment portfolio diversified (in % of total equity investments) (AuM by region, in %) EUR 118.3bn EUR 78.5bn Rest of world 1.9 100% NAFTA 5.8 7.4 Europe ex Euroland 6.9 12.8 34% 9% cluster cluster 10.3 risks1
Slide 84: Value creation through value investing
B. Fit for Value Generation Our traditional approach: Value creation through value investing Total return of Allianz’ industrial holdings portfolio1 Total return p.a. Allianz’ Outperformance Outperformance Ø invested capital industrial holdings vs. DAX vs. MSCI Europe [EUR] 10 Y (1997-2006) 14.0% 5.
Slide 85: Allianz Alternative Assets (AAA) Holding established
B. Fit for Value Generation Our new approach: Allianz Alternative Assets (AAA) Holding established Allianz Alternative Assets (AAA)1 Private Direct ! IRR 24% p.a. (since inception 1998) Equity ! Includes all buyout, mezzanine and growth investments AuM2 EUR 3.9bn ! Total invested capital since 1998:
Slide 86: FIT for Value Generation
B. Fit for Value Generation FIT for Value Generation F inancing I nvestments T ransactions Analysts'conference(kp)_FIN © Allianz SE 2007 B 10
Slide 87: Consistent optimization of corporate structure
B. Fit for Value Generation Consistent optimization of corporate structure Deal Current Investment volume Acquired net Company status ownership (EUR bn) income 2006 (EUR m) Buyout of RAS 100% 5.9 4461 public minorities AGF active 59% 9.82 7023 Allianz Leben active 91% 0.72 353 Gaining Allianz Taiwan
Slide 88: AGF: Why?
B. Fit for Value Generation AGF: Why? ! AGF is an important part of the group ! Inefficiencies in corporate governance and group programs exist ! No integration risk ! Prerequisite for fast(er) implementation of effective European structures ! Basis for more efficient capital Analysts'conference(kp)
Slide 89: AGF: Why now?
B. Fit for Value Generation AGF: Why now? ! Window of opportunity to combine EPS accretive transaction with acceptable take-out price ! High capital generation in Q4 allows for attractive financing structure ! Ongoing speculation kept driving AGF price (levels and volatility) ! Pending earnings and
Slide 90: AGF: Why now? Excess capital invested
B. Fit for Value Generation AGF: Why now? Excess capital invested in AGF Impact1 on equity 56.9 +3.0 as of 2006 50.1 Minority 6.4 2.7 (EUR bn) interest -6.1 -3.7 Shareholders’ 47.4 50.5 equity Total Add. Good- Minori- Total Analysts'conference(kp)_FIN equity shares will ties equity issued EPS accret
Slide 91: AGF: Why now? Premium on share price
B. Fit for Value Generation AGF: Why now? In EUR 140 ! 26% premium on un- disturbed market value 120 provides fair offer for EUR 126 both sides AGF share price 26% premium 100 Analysts'conference(kp)_FIN 80 DJ EURO STOXX Insurance (indexed on AGF share price) 60 September 11, 2005 © Allianz SE 2007
Slide 92: AGF: Why didn't we…
B. Fit for Value Generation AGF: Why didn’t we… …buyback Allianz shares instead? ! EPS accretion of course higher but… ! We are a (strategic) management holding with operational and capital discipline (not a financial portfolio manager) ! Transaction is immediately value-creating (i.e. ROI > CoC) wi
Slide 93: Term sheet - AGF Tender offer
B. Fit for Value Generation Term sheet - AGF Tender offer Consideration 1 AGF share incl. 2006 dividend right EUR 87.50 + 0.25 Allianz share + EUR 0.95 C ! EUR 0.95 increase (0.25 x EUR 3.80 Allianz dividend per share) due to the fact that Allianz shares distributed in the offer do not carry dividen
Slide 94: Term sheet – Allianz Leben
B. Fit for Value Generation Term sheet – Allianz Leben Tender offer ! For 1 Allianz Leben share (including dividend right 2006) EUR 750.00 ! Tender offer period starting end of February 2007 and will last until end of March 2007 Squeeze out ! Consideration to be fixed according to the principles for
Slide 95: Illustrative time table – AGF and Allianz Leben
B. Fit for Value Generation Illustrative time table – AGF and Allianz Leben Tender Offer January February March April May Summer Thereafter… 18 22 9 [23] [20] 2 [7-9] 9 June AGF Beginning End Earliest start of squeeze-out procedure Offer period AGF shareholders meeting AGF Board of Directors Settlem
Slide 96: On Track
Michael Diekmann, CEO On Track Analysts’ conference February 2007
Slide 97: Our commitment in 2005 to you…
C. On Track Our commitment in 2005 to you… Operating profit (EUR bn) EPS (EUR)1 Net income (EUR bn) CAGR 21.8% 36.6% 44.7% 17.09 10.4 Old target: 10% CAGR Old target: 7.0 10% CAGR 8.0 7.0 11.24 Old target: 9.16 10% CAGR 4.4 3.4 Analysts'conference(kp)_FIN 2004 2005 2006 2007 2004 2005 2006 2007 2004
Slide 98: Ongoing optimization will continue to provide sustainable profit potential
C. On Track Ongoing optimization will continue to provide sustainable profit potential1 Corporate Governance RAS minorities Allianz President AGF minorities Life (Taiwan) BVB minorities minorities Allianz Leben minorities Chinese minority JV partner Rosno minorities 2005 2006 2007 2008 Analysts'conf
Slide 99: Optimization: ADAG reorganization on track
C. On Track Optimization: ADAG reorganization on track Structure Target Operating Model Distribution ADAG Management/central functions P/C Life Health Life P/C: Life Market 12.4m P/C Mgmt. Distri- 8.4m bution 4% Operations Health Health: Operations 4.2m Analysts'conference(kp)_FIN Distribution Statu
Slide 100: Optimization: addressing our cross-selling potential
C. On Track Optimization: addressing our cross-selling potential 24m Bank share in new insurance New bank customers won by business tied agents 360,000 334,000 Target 300,000 18m p.a. 13.2% 12.2% 11.6% wel new coming cu # 1 m stomer 4.9% illion Analysts'conference(kp)_FIN 82,000 3.8% 4.6% 2m 2004 20
Slide 101: Allianz banking agencies
C. On Track Optimization: Allianz banking agencies – taking our tied agent distribution to the next level ! Pilot with 100 agencies in Germany ! Double branding ! Full-time banking specialist ! Self-service banking terminal ! Cash dispenser if applicable (depends on ATM presence in neighborhood) Ana
Slide 102: Optimization: AGF transaction – the right move
C. On Track Optimization: AGF transaction – the right move Core markets - France - Spain - Netherlands - Belgium Specialty lines - Mondial - Euler Hermes Analysts'conference(kp)_FIN Growth markets - Latin America - Africa - Middle East © Allianz SE 2007 Top 4 in at least one segment Top 7 in at leas
Slide 103: Optimization: combining forces in Italy
C. On Track Optimization: combining forces in Italy Integration of Strong Leading market Italian operations brands position ! Combination of complementary No 2 strengths Composite insurer - Distribution/regions No 2 - Production Life insurer - Underwriting - Bancassurance/FAs No 3 P/C insurer Analys
Slide 104: Ambition level for Italian operations substantially increased
C. On Track Optimization: ambition level for Italian operations substantially increased Plan 2005 Current plan Operating profit in EUR m, 2006-2008 Operating profit in EUR m, 2007-2009 1,364 1,183 1,261 1,094 966 1,022 412 368 357 Life 349 341 Life 332 Analysts'conference(kp)_FIN P/C 634 681 737 P/C
Slide 105: Significant simplification of Group structure
C. On Track Optimization: significant simplification of Group structure Starting position Target structure 55.4% Allianz AG RAS Allianz SE 91% Allianz Leben 100% 100% ADAG Allianz Health 100% 100% RAS Allianz P/C 99.7% Lloyd Adriatico 99.7% Lloyd Adriatico 100% Allianz Suisse 90% BVB 30.2% Allianz S
Slide 106: Our vision: pre-eminent financial services provider in Europe
C. On Track Our vision: pre-eminent financial services provider in Europe… Strong - Core markets - Growth markets Integrated - Distribution - Products Efficient - Scale Analysts'conference(kp)_FIN - TOM1 Trusted - Brand - Know-how © Allianz SE 2007 Top 4 in at least one segment Top 7 in at least one
Slide 107: Well diversified global presence
C. On Track …with well diversified global presence… Share of 2006 total revenues and operating profit 70.1% 64.8% Revenues Operating profit 2.6 % 2.2% 21.6% 16.6% New Europe 5.6% 3.3% Analysts'conference(kp)_FIN Western Europe Americas 8.1% Asia-Pacific 5.2% © Allianz SE 2007 Specialties1 1) Includi
Slide 108: Strong position in growth markets
C. On Track … and strong position in growth markets Big Growing Profitable (RoRAC) > EUR 8bn +13% +21% ~1/3 New +21% +31% Europe Revenues Analysts'conference(kp)_FIN Allianz >8% Group ~2/3 Asia- +9% +17% Pacific © Allianz SE 2007 All figures referring to year-end 2006 and growth 2006 versus 2005 C 1
Slide 109: Good market position in all four BRIC markets
C. On Track Good market position in all four BRIC markets Brazil Russia ! Top 5 international P/C insurer ! Top 5 insurer with 3.6% market share ! Cross-border expansion into CIS ! Solid double-digit growth markets B R Analysts'conference(kp)_FIN India I C China ! Second largest private insurer ! To
Slide 110: Capital management: risk-adjusted capital earns cost of capital
C. On Track Capital management: total risk-adjusted capital earns cost of capital1 RAC and RoRACN2 (12M 2006, in % of risk-adjusted capital) RoRACN 15.0% 2006 80% 8.15% 2005 70% 2006: 100% 60% 2006: 75% RoRACN 50% > 8.15% 2005: 40% 71% 2005: Analysts'conference(kp)_FIN 30% 98% RoRACN > 15% 20% Targe
Slide 111: Capital management: dividend almost doubled
C. On Track Capital management: dividend almost doubled Dividend Dividend per share (in EUR) 1,642 Total dividend (in EUR m) Target 3.80 Payout ratio of peers within next 2 years1 811 2.00 1.75 674 Analysts'conference(kp)_FIN 1.50 511 2003 2004 2005 2006 © Allianz SE 2007 History 36% dividend CAGR o
Slide 112: A promise is a promise – the challenge
C. On Track A promise is a promise – the challenge Operating profit (EUR bn) CAGR 13.7% Target 2007 - 2009 10% 10% CAGR of operating profit from adjusted 2006 10.0 8.0 7.0 Operating profit Caveats e.g.: adjusted to normal - Nat Cat development Analysts'conference(kp)_FIN 4.0 Nat Cat claims level unp
Slide 113: Outlook 2007 – 2009
C. On Track Outlook 2007 – 2009 10% operating profit CAGR from adjusted 2006 basis P/C L/H Banking AM Ø combined ratio Ø new business Ø RoRAC >15% 10% 3rd party AuM < 94% margin > 3% CAGR1 Analysts'conference(kp)_FIN © Allianz SE 2007 1) Before F/X impact Caveats e.g.: - Nat Cat development unpredic
Slide 114: Embedded Value 2006
Helmut Perlet, Member of the Board Embedded Value 2006 Analysts’ Conference February 2007
Slide 115: Value of New Business and Embedded Value significantly higher
D. Embedded Value 2006 Value of New Business and Embedded Value significantly higher (a/min, EUR m) New Business Margin (NBV in % of PV of premiums) New Business Value Embedded Value +0.2%-p 2.9 3.1 EV profit: +7.7% +23.4%3 0.6%1 3.1% 982 912 19,555 2.3% 15,849 1,0202 2005 2006 2,491 8801 Analysts'c
Slide 116: Allianz adopted market consistent Embedded Value
D. Embedded Value 2006 Allianz adopted market consistent Embedded Value (EV) for its major Life entities Economic Balance Sheet Best estimate policyholder liability How much value Who gets this value? ! Projection of inforce cash flows of do we have? current portfolio till run-off ! Appropriate eval
Slide 117: Definition and components of Allianz EV
D. Embedded Value 2006 Definition and components of Allianz EV Net Asset Value (NAV): Equity component of EV FS ! Free Surplus (FS): Market value of capital not required to support the inforce covered business + ! Required capital (ReC): Value of assets attributed to the covered ReC NAV business ove
Slide 118: Main changes in methodology and impact on results (1)
D. Embedded Value 2006 Main changes in methodology and impact on results (1) (a/ min, EUR m) EV 2005 restated1 Top-down Bottom-up2 Impact FS 1,240 2,345 FS: +1,105 NAV: no impact + + ReC decreases: + 6,982 5,877 ReC: -1,105 VIF is eligible source to cover ReC NAV 8,222 8,222 NAV: 0 Risk Capital + +
Slide 119: Main changes in methodology and impact on results (2)
D. Embedded Value 2006 Main changes in methodology and impact on results (2) a/ min, EUR m VIF: +877 CNFR 1,155 15,849 ! Top-down: implicitly included in RDR 14,972 2,895 -2,738 -435 ! Bottom-up: explicitly valued VIF 6,750 7,627 CReC NAV 8,222 8,222 ! Top-down: cost of capital charge ! Bottom-up: t
Slide 120: Main changes in methodology and impact on results (3)
D. Embedded Value 2006 Main changes in methodology and impact on results (3) - New business values increase by 35% under market consistent EV a/ min, EUR m +34.7% 423 -194 112 -39 -66 912 1 677 VNB 20051 Risk-free Risk Change CNFR Change VNB 20051 discount neutral in O&G in CReC Analysts'conference(
Slide 121: Movement of Embedded Value 2006
D. Embedded Value 2006 Movement of Embedded Value 2006 VNB Margin 2005 663 2.3% a/ min, EUR m F/X -361 2005 r 912 2.9% Minorities 705 2006 982 3.1% Other Adj. -340 diff 8% 0.2%-p MCEV 877 982 54 294 18.535 1.480 895 -1.020 880 15.849 14.968 10,155 VIF 6,358 7,627 Analysts'conference(kp)_FIN 8,222 8,
Slide 122: Shareholder value not accounted for in IFRS equity
D. Embedded Value 2006 Shareholder value not accounted for in IFRS equity (a/min, EUR m) Value of Inforce in EV 10,155 Adjust for: ! IFRS DAC / VOBA -11,809 ! Difference in life- and unallocated profit sharing reserves 11,177 ! Shareholder value of unrealized capital gains included in PVFP -1,725 !
Slide 123: Embedded Value and EV profit: growth in all regions
D. Embedded Value 2006 Embedded Value and EV profit: growth in all regions (a/min, EUR m) EV profit +21%3 14,730 8104 EV profit 12,164 +20%3 416 EV profit -34 +27%3 13,920 346 419 3,716 2005r1 2006 Asia 2,934 99 New Europe 3% 3,617 2005r1 2006 EV profit Western Europe +83%3 2005r1 2006 Analysts'conf
Slide 124: New business values and margins by region
D. Embedded Value 2006 New business values and margins by region 2005 (a/min, EUR m) 2005 rest 2006 Value of new business Margin (%)2 Comments ! Lower guarantees in new business had not been 124 2.4 adequately reflected in old methodology Germany 163 2.6 ! New products and higher interest environmen
Slide 125: Embedded Value 2006 – Key messages
D. Embedded Value 2006 Embedded Value 2006 – Key messages ! Integrated framework for Embedded Value and risk capital allows to exploit market opportunities ! New business margins improve to 3.1% in 2006 ! New business value increased to EUR 982m ! Embedded Value profit increased to 23% Analysts'conf
Slide 126: Appendix of Analyst presentation
Appendix of Analyst presentation D 12 © Allianz SE 2007 Analysts'conference(kp)_FIN
Slide 127: Embedded Value of Allianz' life operations
Embedded Value of Allianz’ life operations Analysts'conference(kp)_FIN © Allianz SE 2007 D 13
Slide 128: Composition of Allianz Embedded Value
D. Embedded Value 2006 Composition of Allianz Embedded Value a/ min, EUR m Regional split 13.228 18.535 -1.542 -530 -1.000 5.182 3.096 8.379 Analysts'conference(kp)_FIN 3.404 2.238 419 3.617 590 NAV PVFP O&G CNFR CReC EV1 Germany France Italy Other New USA Asia W. Europe Europe Pacific © Allianz SE
Slide 129: Overview Embedded Value 2005
D. Embedded Value 2006 Overview Embedded Value 2005 (a/ min, EUR m) 2005 rest 2006 Embedded Value O&G Comments NAV VIF ! 32% increase in EV compared to published value 2005. 208 1364 2559 3,922 ! Significant growth in 2006 Germany 1366 2992 4,358 756 ! O&G higher under MCEV, but due to higher intere
Slide 130: Movement of Embedded Value 2006
D. Embedded Value 2006 VNB Margin Movement of Embedded Value 2006 2005 663 2.3% F/X -361 2005 r 912 2.9% a/ min, EUR m Minorities 705 2006 982 3.1% Other Adj. -340 diff 8% 0.2%-p MCEV 877 294 982 54 1.480 18.535 895 -1.020 880 15.849 14.968 Ending Initial Starting Un- Market Operating Value of Other
Slide 131: Initial adjustments including transition to MCEV
D. Embedded Value 2006 Initial adjustments including transition to MCEV a/ min, EUR m 2,895 1,155 15,849 14,968 705 14,972 -361 -340 -2,738 -435 Ending FX Change in Other EV 2005 Risk-free Risk neutral CNFR Change in Ending Embedded change minorities adjustm. Restated discount scenarios CReC Embedde
Slide 132: Movement of Value of New Business
D. Embedded Value 2006 Movement of Value of New Business a/ min, EUR m 4 35 0 982 236 912 30 663 13 VNB Minorities/ MCEV and VNB Increase in Business Assumption Other VNB published FX other model restated volume mix changes 2006 2005 changes 2005 Analysts'conference(kp)_FIN MCEV adjustment New Busin
Slide 133: Movement 2006: Germany
D. Embedded Value 2006 Movement 2006: Germany VNB Margin PVNBP 2005 124 2.4% 5,108 2005 r 163 2.6% 6,204 a/ min, EUR m 2006 244 3.0% 8,053 delta 50% 0.4%-p 30% Other Adj. 6 MCEV 430 244 4 182 432 5.182 436 4.358 249 -287 3.922 3,812 VIF 2,559 2,992 VIF -370 NAV 788 1,369 NAV 1,364 1,366 Ending Initi
Slide 134: Movement 2006: France
D. Embedded Value 2006 Movement 2006: France VNB Margin PVNBP 2005 72 2.8% 2,614 2005 r 95 3.3% 2,928 a/ min, EUR m 2006 109 3.5% 3,088 Minorities -38 delta 14% 0.2%-p 5% Other Adj. -276 MCEV 265 109 385 3.073 3.023 98 3.096 -94 -19 -49 -405 1,812 VIF 1,183 1,528 VIF -370 NAV 788 1,284 NAV 1,890 1,4
Slide 135: Movement 2006: Italy
D. Embedded Value 2006 Movement 2006: Italy VNB Margin PVNBP 2005 138 2.6% 5,269 2005 r 215 3.2% 6,761 a/ min, EUR m Minorities 584 2006 224 3.5% 6,401 Other Adj. -68 delta 4% 0.3%-p -5% MCEV 274 93 224 1 129 3.404 790 3.114 -50 -106 2.324 1,703 VIF 1,037 1,523 VIF -370 NAV 788 1,701 NAV 1,287 1,591
Slide 136: Movement 2006: Other Western Europe
D. Embedded Value 2006 Movement 2006: Other Western Europe VNB Margin PVNBP 2005 41 2.9% 1,441 2005 r 73 4.1% 1,780 a/ min, EUR m F/X -18 2006 70 4.3% 1,650 Minorities 159 delta -4% 0.2%-p -7% Other Adj. 29 30 70 7 2,238 MCEV -10 400 -12 1,668 74 160 1,509 1,060 VIF 557 680 VIF -370 NAV 788 1,178 NA
Slide 137: Movement 2006: New Europe
D. Embedded Value 2006 Movement 2006: New Europe VNB Margin PVNBP 2005 32 7.6% 414 2005 r 37 8.4% 439 a/ min, EUR m 2006 42 6.1% 687 F/X 17 delta 12% -2.3%-p 57% Other Adj. -7 42 2 3 419 27 0 336 10 346 -1 242 VIF 180 213 VIF -370 NAV 788 176 NAV 156 132 Ending Initial Starting Un- Market Operating
Slide 138: Movement 2006: USA
D. Embedded Value 2006 Movement 2006: USA VNB Margin PVNBP 2005 210 1.9% 10,949 2005 r 251 2.5% 9,866 a/ min, EUR m 2006 195 2.5% 7,943 F/X -350 delta -22% -0.0%-p -19% Other Adj. -25 MCEV -49 195 35 3.617 3.357 287 47 219 -99 2.934 -423 1,698 VIF 1,255 1,114 VIF -370 NAV 788 1,919 NAV 2,102 1,820 E
Slide 139: Movement 2006: Asia-Pacific
D. Embedded Value 2006 Movement 2006: Asia-Pacific VNB Margin PVNBP 2005 72 2.6% 2,701 2005 r 109 3.9% 2,807 a/ min, EUR m 2006 129 3.9% 3,349 F/X -10 delta 18% 0.0%-p 19% Other Adj. 1 MCEV -9 129 10 206 590 96 -142 419 400 -87 -18 VIF -370 -109 -357 VIF -370 NAV 788 677 NAV 788 758 Ending Initial S
Slide 140: Movement of EV and free surplus
D. Embedded Value 2006 Movement of EV and free surplus NAV a/ min, EUR m FS ReC VIF EV Reported Value as at 31 December 2005 1,501 7,109 6,358 14,968 Total initial adjustments 844 -1,233 1,269 880 Starting Value as at 31 December 2005 2,345 5,877 7,627 15,849 Total Unwinding (inforce) 1,336 20 -460
Slide 141: Sensitivity analysis of Embedded Value
D. Embedded Value 2006 Sensitivity analysis of Embedded Value (a/ min, EUR m) Embedded Value Economic factors Non economic factors Using Base statutory solvency risk-free assumption -5% mortality case capital +10% -10% -10% volatility expenses Death Longevity lapse -100 bp +100 bp risk risk Germany
Slide 142: Sensitivity analysis of value of new business
D. Embedded Value 2006 Sensitivity analysis of value of new business (a/min, EUR m) Embedded Value Economic factors Non economic factors Using Base statutory solvency risk-free assumption -5% mortality case capital +10% -10% -10% volatility expenses Death Longevity lapse -100 bp +100 bp risk risk Ge
Slide 143: Overview new business – key profitability indicators
D. Embedded Value 2006 Overview new business – key profitability indicators (a/ min, EUR m) Recurrent VNB Margin PVNBP Premium Single Premium Strain1 2006 2005 2006 2005 2006 2005 2006 2005 2006 2005 2006 2005 Germany 244 124 3.0% 2.4% 8,053 5,108 436 360 2,719 1,616 -57 -34 France 109 72 3.5% 2.8%
Slide 144: Consistent economic assumptions across Allianz Group
D. Embedded Value 2006 Consistent economic assumptions are applied across Allianz Group Key parameters Specification 2006 (2005 restatement) Risk free rates EUR 4.1% (2.9%) CHF 2.4% (1.7%) (1year zero coupon rates based on swap rate) USD 5.4% (4.6%) KRW 5.0% (4.6%) Risk free rate EUR 4.3% (3.5%) CHF
Slide 145: Explanation on the regional split
D. Embedded Value 2006 Explanation on the regional split Germany Allianz Leben AG, life subsidiaries are included at equity France AGF life operation in France including partnerships Italy Italian and Irish life subsidiaries of RAS and life subsidiaries of Lloyd Adriatico Other Western Europe Life o
Slide 146: Allianz Embedded Value framework for life business
D. Embedded Value 2006 Allianz Embedded Value framework for life business Net asset value (NAV) + Present value of future profits (PVFP) Embedded Value – Time value of options & guarantees (O&G) – Cost of non-financial risk (CNFR) (EV) – cost of required capital (CReC) Net asset value Capital not ba
Slide 147: Shareholder value not accounted for in IFRS equity
D. Embedded Value 2006 Shareholder value not accounted for in IFRS equity Statutory Balance Sheet EV or shareholder value IFRS Balance Sheet Assets not Assets EV-NAV IFRS backing IFRS backing Stat. Liabilities Equity equity IFRS - Equity (BV) equity = EV-VIF Analysts'conference(kp)_FIN IFRS-VIF Asse
Slide 148: Main valuation differences
D. Embedded Value 2006 Shareholder value not accounted for in IFRS equity - main valuation differences IFRS amounts in DAC/VOBA exceed statutory DAC/VOBA levels included in PVFP Aggregate IFRS life technical and unallocated Difference in reserves profit sharing reserves exceed statutory reserves use
Slide 149: EEV: Review of Embedded Value methodology
D. Embedded Value 2006 EEV: Review of Embedded Value methodology “Tillinghast has reviewed the methodology and assumptions used to determine the 2006 Embedded Value results for the Allianz Group. Our review covered the Embedded Value as at 31 December 2006, the value of 2006 new business, the analys
Slide 150: Index
Index Analysts’ conference March 2006
Slide 151: Index (1)
E. Index Index (1) A. Group Financial Results 2006 A P/C: selective use of market opportunities A 23 P/C: tailored local market cycle management A 24 2006: another year of success… A 1 P/C: excellent combined ratio across all regions A 25 …based on sustainable improvements A 2 P/C: expenses present
Slide 152: Index (2)
E. Index Index (2) AM: …while maintaining a very competitive cost-income ratio A 47 B. FIT for Value Generation B Agenda A 48 Summary A 49 FIT for Value Generation B 1 Agenda A 50 Financing highlights 2006 B 2 Group: result by segments overview A 51 Balanced maturity structure of issued bonds B 3 Gr
Slide 153: Index (3)
E. Index Index (3) C. On Track C D. Embedded Value 2006 D Our commitment in 2005 to you… C 1 Value of New Business and Embedded Value Ongoing optimization will continue to provide sustainable significantly higher D 1 profit potential C 2 Allianz adopted market consistent EV for its major life entiti
Slide 154: Index (4)
E. Index Index (4) Movement 2006: Other Western Europe D 22 E. Index E Movement 2006: New Europe D 23 Movement 2006: USA D 24 Movement 2006: Asia-Pacific D 25 Movement of EV and free surplus D 26 F. Appendix F Sensitivity analysis of Embedded Value D 27 Sensitivity analysis of value of new business
Slide 155: Appendix
Appendix Analysts’ conference March 2007
Slide 156: Glossary (1)
Glossary (1) AEG (Alterseinkünftegesetz) German law on retirement savings ADAG Allianz Deutschland AG AFS Securities available for sale AGI Allianz Global Investors AGCS Allianz Global Corporate & Specialty AGM Annual General Meeting AGR Allianz Global Risks (now bundled with AMA in AGCS) AMA Allian
Slide 157: Glossary (2)
Glossary (2) BVB Bayerische Versicherungsbank CAGR Compounded average growth rate Capital ratios (BIS) Ratios calculated by banks conducting international business, in accordance with the Basel Capital Accord drawn up under the guidance of the Bank for International Settlements - Tier I ratio: Relat
Slide 158: Glossary (3)
Glossary (3) Excess capital Net asset value (NAV) – risk-adjusted capital (RAC) Expense ratio Acquisition and administrative expenses (net) as % of net premiums earned F/I Fixed income FTE Full-time equivalents Goodwill Difference between a subsidiary’s purchase price and its shareholders’ equity at
Slide 159: Glossary (4)
Glossary (4) L/H Life and health insurance NAV Net asset value NOPAT Normalized profit after taxes MCEV Market consistent embedded value Operating profit Measure which we believe highlights the underlying profitability of our operations. For a description of how we measure operating profit and a rec
Slide 160: Glossary (5)
Glossary (5) SE Societas Europaea (European company) Statutory premiums Premium income under local GAAP T-shares Treasury shares TOM Target operating model VAG German insurance supervisory law (Versicherungsaufsichtsgesetz) Value-at-Risk (VaR) Potential loss which may occur during a pre-defined peri
Slide 161: Investor Relations contacts
Investor Relations contacts Oliver Schmidt Tel. +49 (0) 89 3800-3963 Holger Klotz Tel. +49 (0) 89 3800-18124 Head of E-mail: E-mail: Investor Relations [email protected] [email protected] Susanne Arheit Tel. +49 (0) 89 3800-3324 Christian Tel. +49 (0) 89 3800-3892 Lamprecht E-mail: E
Slide 162: Financial calendar 2007/2008
Financial calendar 2007/2008 May 2, 2007 Annual General Meeting May 8, 2007 Announcement of first quarter results 2007 May 8, 2007 Interim report first quarter 2007 August 3, 2007 Announcement of second quarter results 2007 August 10, 2007 Interim report second quarter 2007 November 9, 2007 Announce
Slide 163: 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