Allianz Worldwide Care continues to build a reputation for service excellence www.allianzworldwidecare.com/myhealth
Allianz Worldwide Care’s medical escort team took a ferry to the U.K., got a train to Paris and then flew via Azerbaijan to reach the patient.
Allianz Worldwide Care was one of the winners of the Allianz Group’s Global Innovation Awards scheme in July 2014, in recognition of its employee health and well being program.
The company’s health and wellbeing initiative included weekly onsite yoga sessions, the establishment of sports clubs, women’s and men’s health information sessions and health screenings.
The Capuchin Day Centre, a Dublin-based charity, provides 1,000 food parcels and 6,000 hot meals weekly to those expe riencing poverty. It was the bene - ficiary chosen to receive the award fund of € 10,000.
General information 157 1 Nature of operations and basis of presentation 157 2 Summary of significant accounting policies 166 3 Use of estimates and assumptions 171 4 Recently adopted and issued accounting pronouncements 176 6 Segment reporting notes to the Consolidated Balance Sheets 190 7 Cash and cash equivalents 190 8 Financial assets carried at fair value through income 194 10 Loans and advances to banks and customers 194 11 Reinsurance assets 195 12 Deferred acquisition costs 196 13 Other assets 198 14 Non-current assets and assets and liabilities of disposal groups classified as held for sale 198 15 Intangible assets 203 16 Financial liabilities carried at fair value through income 203 17 Liabilities to banks and customers 204 18 Unearned premiums 204 19 Reserves for loss and loss adjustment expenses 209 20 Reserves for insurance and investment contracts 212 21 Financial liabilities for unit-linked contracts 213 22 Other liabilities 214 23 Certificated liabilities 215 24 Subordinated liabilities 151 Consolidated BalanCe sheets 152 Consolidated inCome statements 153 Consolidated statements of Comprehensive inCome 154 Consolidated statements of Changes in equity 155 Consolidated statements of Cash flows 157 notes to the Consolidated finanCial statements notes to the Consolidated income Statements 219 26 Premiums earned (net) 219 27 Interest and similar income 220 28 Income from financial assets and liabilities carried at fair value through income (net) 220 29 Realized gains/losses (net) 221 30 Fee and commission income 221 31 Other income 221 32 Income and expenses from fully consolidated private equity investments 222 33 Claims and insurance benefits incurred (net) 222 34 Change in reserves for insurance and investment contracts (net) 223 35 Interest expenses 223 36 Loan loss provisions 223 37 Impairments of investments (net) 223 38 Investment expenses 223 39 Acquisition and administrative expenses (net) 224 40 Fee and commission expenses 224 41 Other expenses 224 42 Income taxes other information 227 43 Derivative financial instruments 229 44 Financial instruments and fair value measurement 240 45 Interests in unconsolidated structured entities 242 46 Related party transactions 242 47 Litigation, guarantees and other contingencies and commitments 244 48 Pensions and similar obligations 248 49 Share-based compensation plans 251 50 Restructuring plans 253 51 Earnings per share 253 52 Other information 255 53 Subsequent events 256 List of participations of the Allianz Group as of 31 December 2014 according to § 313 (2) HGB
Consolidated balanCe sheets consolidated balance sheets € mn note as of 31 December as of 31 December as of 1 January assets Cash and cash equivalents 7 13,863 11,207 12,437 Financial assets carried at fair value through income 8 5,875 6,660 7,165
Loans and advances to banks and customers 10 117,075 116,800 119,369 Financial assets for unit-linked contracts 94,564 81,064 71,197
Non-current assets and assets of disposal groups classified as held for sale 14 235 147 15 liabilities and eQUitY Financial liabilities carried at fair value through income 16 8,496 6,013 5,397 Liabilities to banks and customers 17 23,015 23,109 22,425
Reserves for loss and loss adjustment expenses 19 68,989 66,566 72,540 Reserves for insurance and investment contracts 20 463,334 404,072 390,984 Financial liabilities for unit-linked contracts 21 94,564 81,064 71,197
Claims and insurance benefits incurred (gross) (52,140) (50,178) Claims and insurance benefits incurred (ceded) 2,490 2,376 Claims and insurance benefits incurred (net) 33 (49,650) (47,802) Change in reserves for insurance and investment contracts (net) 34 (13,929) (13,990)
Loan loss provisions 36 (45) (86) Impairments of investments (net) 37 (894) (611)
Expenses from fully consolidated private equity investments 32 (720) (740) Total expenses (94,314) (91,772)
Basic earnings per share (€) 51 13.71 13.23 Diluted earnings per share (€) 51 13.64 13.05
Available-for-sale investments Reclassifications to net income (641) (817) Changes arising during the year 7,817 (2,537)
Cash flow hedges Reclassifications to net income 34 10 Changes arising during the year 50 (63)
Miscellaneous Reclassifications to net income – – Changes arising during the year (151) 105
Paid-in capital 59 – – – 59 – 59 1 Total comprehensive income in shareholders’ equity for the year ended 31 December 2014 comprises net income attributable to shareholders of € 6,221 mn (2013: € 5,996 mn).
€ mn sUmmarY Net cash flow provided by operating activities 32,232 23,239 Net cash flow used in investing activities (26,927) (22,801) Net cash flow used in financing activities (3,189) (1,436) Effect of exchange rate changes on cash and cash equivalents 541 (232) Change in cash and cash equivalents 2,656 (1,230) Cash and cash equivalents at beginning of period 11,207 12,437 Cash and cash equivalents at end of period 13,863 11,207 cash flow from operating activities Net income 6,603 6,343 Adjustments to reconcile net income to net cash flow provided by operating activities
Depreciation and amortization 1,159 1,108 Loan loss provisions 45 86 Interest credited to policyholder accounts 3,879 4,163 Net change in: Financial assets and liabilities held for trading 375 300 Reverse repurchase agreements and collateral paid for securities borrowing transactions 107 227 Repurchase agreements and collateral received from securities lending transactions 466 95 Reinsurance assets (218) (207) Deferred acquisition costs (1,219) (720) Unearned premiums 1,120 832 Reserves for loss and loss adjustment expenses 1,039 (1,071) Reserves for insurance and investment contracts 23,036 12,004 Deferred tax assets/liabilities (10) 375
Business combinations (note 5): Proceeds from sale of subsidiaries, net of cash disposed – 81 Acquisitions of subsidiaries, net of cash acquired (200) (416)
Change in other loans and advances to banks and customers (originated loans) (2,403) (695) Other (net) (665) 599 Net cash flow used in investing activities (26,927) (22,801)
cash flow from financing activities Net change in liabilities to banks and customers (873) 873 Proceeds from the issuance of certificated liabilities and subordinated liabilities 3,823 6,236 Repayments of certificated liabilities and subordinated liabilities (3,435) (6,204) Cash inflow from capital increases 51 47 Transactions between equity holders (78) 12 Dividends paid to shareholders (2,716) (2,303) Net cash from sale or purchase of treasury shares 6 7 Other (net) 35 (104) Net cash flow used in financing activities (3,189) (1,436)
Basis of preseNtatioN The consolidated financial statements of the Allianz Group have been prepared in conformity with International Financial Reporting Standards (IFRS), as adopted under European Union (E.U.) regulations in accordance with § 315a of the German Commercial Code (HGB). Within these consolidated financial statements, the Allianz Group has applied all standards and interpretations issued by the IASB and endorsed by the E.U. that are compulsory as of 31 December 2014. IFRS comprise International Financial Reporting Standards (IFRS), International Accounting Standards (IAS) and interpretations developed by the IFRS Interpretations Committee (formerly called the IFRIC) or the former Standing Interpretations Committee (SIC).
The accounting policies adopted are consistent with those of the previous financial year, except for recently adopted IFRS effective 1 January 2014.
The consolidated financial statements are prepared as of and for the year ended 31 December and presented in millions of Euro (€ mn), unless otherwise stated. Due to rounding, numbers presented may not add up precisely to the totals provided and percentages may not precisely reflect the absolute figures. Previously published figures have been adjusted accordingly.
Joint arrangements are structures over which the Allianz Group and one or more other parties contractually sharing control require unanimous consent when decisions over the relevant activities are to be made. Joint arrangements whereby the Allianz Group has rights to the net assets of the arrangement (joint venture) are generally accounted for using the equity method.
The Allianz Group accounts for all material investments in associates on a time lag of no more than three months. Income from investments in associates and joint arrangements, which reflects the earnings rather than the distributions of the associate or jointly controlled entity, is included in interest and similar income. Profits or losses resulting from transactions between the Allianz Group and the associate or joint arrangement are eliminated to the extent of the interest in the associate or joint arrangement. Accounting policies of associates and joint arrangements are adjusted where necessary to ensure consistency with the accounting policies adopted by the Allianz Group.
In some jurisdictions the ability of associates and joint arrangements to transfer funds to the Allianz Group in the form of dividends or to repay loans is subject to local corporate or insurance laws and regulations and solvency requirements.
Derecognition A financial asset is derecognized when the contractual rights to the cash flows from the financial asset expire or the Allianz Group transfers the asset and substantially all of the risks and rewards of ownership. A financial liability is derecognized when it is extinguished.
Hedge accounting For derivative financial instruments used in hedge transactions that meet the criteria for hedge accounting, the Allianz Group designates the derivative as a hedging instrument in a fair value hedge, cash flow hedge, or hedge of a net investment in a foreign operation. The Allianz Group documents the hedge relationship, as well as its risk management objective and strategy for entering into the hedge
Cash flow hedges offset the exposure to variability in expected future cash flows that is attributable to a particular risk associated with a recognized asset or liability or a highly probable forecasted transaction. Changes in the fair value of a derivative financial instrument that represent an effective hedge are recorded in unrealized gains and losses (net) in other comprehensive income, and are transferred to the consolidated income statement when the offsetting gain or loss associated with the hedged item is recognized. Any ineffectiveness of the cash flow hedge is recognized directly in income from financial assets and liabilities carried at fair value through income (net).
Furthermore, hedge accounting may be applied to derivative financial instruments used to hedge the foreign currency risk associated with a net investment in a foreign operation. The effective proportion of gains or losses arising from the measurement of the derivative financial instrument is recognized in foreign currency translation adjustments in other comprehensive income, while any ineffectiveness is recognized directly in income from financial assets and liabilities carried at fair value through income (net).
Disclosures relating to financial instruments The following table summarizes the relationship between the balance sheet positions and the classes of financial instruments according to IFRS 7. The balance sheet positions are the same as the IAS 39 categories except when noted in parentheses.
BaLaNCe sheet LiNe items, ias 39 CateGories aND ifrs 7 CLasses of fiNaNCiaL iNstrumeNts
Financial assets held for trading Fair value Financial assets designated at fair value through income Fair value
Non-unit-linked investment contracts Amortized cost Financial liabilities for unit-linked contracts Fair value Other liabilities
Annual Report 2014 Allianz Group 161 fiNaNCiaL assets aND LiaBiLities CarrieD at fair VaLue throuGh iNCome Financial assets and liabilities carried at fair value through income include financial assets and liabilities held for trading and financial assets and liabilities designated at fair value through income. Financial assets and liabilities held for trading consist of debt and equity securities that have been principally acquired for the purpose of generating a profit from short-term fluctuations in price or for the purpose of selling in the near future as well as of derivative financial instruments, which include bifurcated embedded derivatives of hybrid financial instruments and of insurance contracts.
Investments in associates and joint ventures Please see the section principles of consolidation for details on the accounting for investments in associates and joint ventures.
Real estate held for investment Real estate held for investment (i.e. real estate and rights equivalent to real property and buildings, including buildings on leased land) is carried at cost less accumulated depreciation and impairments. Real estate held for investment is depreciated on a straight-line basis over its estimated life, with a maximum of 50 years. At each reporting date or whenever there are any indications that the carrying amount may not be recoverable, real estate is tested for impairment by determining its recoverable amount. Subsequent costs are capitalized if they extend the useful life or increase the value of the asset; otherwise they are expensed as incurred.
LoaNs aND aDVaNCes to BaNks aND Customers Loans and advances are non-derivative financial assets with fixed or determinable payments that are not quoted in an active market and which are not classified as financial assets held for trading, designated at fair value through income or designated as available for sale. Loans and advances are initially recognized at fair value. Subsequently, they are measured at amortized cost using the effective interest method. Interest income is accrued on the unpaid principal balance, net of impairments. Using the effective interest method, net deferred fees and premiums or discounts are recorded as an adjustment of other interest income yield over the lives of the related loans.
fiNaNCiaL assets for uNit-LiNkeD CoNtraCts Financial assets for unit-linked contracts are recorded at fair value with changes in fair value recorded in the income statement together with the offsetting changes in fair value of the corresponding financial liabilities for unit-linked contracts.
Deferred acquisition costs (DaC) Costs that vary with and are directly related to the acquisition and renewal of insurance contracts and investment contracts with discretionary participation features are deferred by recognizing a DAC asset. DAC generally consists of commissions, underwriting expenses and policy issuance costs. At inception, DAC is tested to ensure that it is recoverable over the life of the contracts. Subsequently, loss recognition tests at the end of each reporting period ensure that only the amount of DAC that is covered by future profits is carried on the consolidated balance sheet. Please refer to the section reserves for insurance and investment contracts, where details on the corresponding liability adequacy test are explained.
Present value of future profits (pVfp) The value of an insurance business or an insurance portfolio acquired is measured by the PVFP, which is the present value of net cash flows anticipated in the future from insurance contracts in force at the date of acquisition. It is amortized over the life of the related contracts.
DeferreD taX assets The calculation of deferred tax assets is based on tax loss carry forwards, unused tax credits and on deductible temporary differences between the Allianz Group’s carrying amounts of assets or liabilities in its consolidated balance sheet and their tax bases. The tax rates used for the calculation of deferred taxes are the local rates applicable in the countries concerned; changes to tax rates which have been substantively enacted prior to or as of the consolidated balance sheet date are taken into account. Deferred tax assets are recognized only to the extent it is probable that sufficient future taxable income will be available for their realization.
The Allianz Group also records the fixed assets of its fully consolidated private equity investments and alternative investments within property and equipment. These assets are carried at cost less accumulated depreciation and impairments. Depreciation is generally computed using the straight-line method over the estimated useful lives of the assets.
Fixed assets of alternative investments 4 – 25 iNtaNGiBLe assets Intangible assets with indefinite useful lives mainly consist of goodwill resulting from business combinations. It is initially determined as the excess of the consideration transferred in a business combination and any non-controlling interest over the net identifiable assets acquired. Goodwill is not amortized. It is evaluated at least annually whether the goodwill is deemed recoverable. Goodwill is allocated to each of the Allianz Group’s cash gener ating units expected to benefit from the synergies of the business combination. The Allianz Group conducts an annual impairment test of goodwill during the fourth quarter or more frequently if there is an indication that goodwill is not recoverable. The impairment test includes comparing the recoverable amount to the carrying amount, including goodwill, of all relevant cash generating units. A cash generating unit is impaired if the carrying amount is greater than the recoverable amount. The impairment amount is allocated to first reduce any goodwill, followed by allocation to the carrying amount of any remaining non-financial assets of the cash generating unit. Impairments of goodwill are not reversed. Gains or losses realized on the disposal of subsidiaries include any related goodwill.
For other long-duration contracts, if the present value of estimated gross profits or margins, plus unearned revenue liability, if applicable, will not be sufficient to recover DAC, a premium deficiency is recognized.
uNearNeD premiums For short-duration insurance contracts, like most of the property and casualty contracts, premiums to be earned in future years are recorded as unearned premiums. These premiums are earned in subsequent periods in relation to the insurance coverage provided.
Amounts charged as consideration for origination of certain long-duration insurance contracts (i.e. initiation or front-end fees) are reported as unearned revenue which are included in unearned premiums. These fees are recognized using the same amortization methodology as DAC.
Aggregate policy reserves The aggregate policy reserves for participating life insurance contracts are calculated using the net level premium method based on assumptions for mortality, morbidity and interest rates that are guaranteed in the contract or used in determining the policyholder dividends (or premium refunds).
Reserves for premium refunds Reserves for premium refunds include the amounts allocated under the relevant local statutory/contractual regulations or at the entity’s discretion to the accounts of the policyholders and the amounts resulting from the differences between these IFRS-based financial statements and the local financial statements (latent reserve for premium refunds), which will reverse and enter into future profit participation calculations. Unrealized gains and losses recognized for available-for-sale investments are recognized in the latent reserve for premium refunds to the extent that policyholders will participate in such gains and losses on the basis of statutory or contractual regulations when they are realized, based on and similar to shadow accounting.
DeferreD taX LiaBiLities Deferred tax liabilities are recognized for temporary differences between the Allianz Group’s carrying amounts of assets or liabilities in its consolidated balance sheet and their tax bases.
Please refer to note 3, where the processes and controls for ensuring an appropriate use of estimates and assumptions are explained.
Financial liabilities for puttable equity instruments Financial liabilities for puttable equity instruments primarily include the non-controlling interests in the net assets of controlled mutual funds. These interests qualify as a financial liability of the Allianz Group, as they give the holder the right to put the instrument back to the Allianz Group for cash or another financial asset (puttable instrument). These liabilities are generally required to be recorded at the redemption amount with changes recognized in the income statement.
Both sides of the Allianz Group’s balance sheet have a high degree of estimation and numerous assumptions embedded in the valuation of assets and liabilities. The estimation process and selection of appropriate assumptions requires significant judgment to be
Retained earnings comprise the net income of the current year, not yet distributed earnings of prior years and treasury shares as well as any amounts directly recognized in equity according to IFRS. Treasury shares are deducted from shareholders’ equity. No gain or loss is recognized on the sale, issuance, acquisition or cancellation of these shares. Any consideration paid or received is recorded directly in shareholders’ equity.
Unrealized gains and losses (net) include unrealized gains and losses from available-for-sale investments and derivative financial instruments that meet the criteria for cash flow hedge accounting.
PREMIUMS Premiums for short-duration insurance contracts are recognized as revenues over the period of the contract in proportion to the amount of insurance protection provided. Unearned premiums are calculated separately for each individual policy to cover the unexpired portion of written premiums.
INTEREST AND SIMILAR INCOME AND INTEREST ExPENSES Interest income and interest expenses are recognized on an accrual basis. Interest income is recognized using the effective interest method. This line item also includes dividends from available-forsale equity securities and income from investments in associates and joint ventures. Dividends are recognized in income when the right to receive the dividend is established. Share of earnings from investments in associates and joint ventures represents the share of net income from entities accounted for using the equity method.
For Life/Health and for Property-Casualty the central oversight process includes the following key components: Group-wide standards and guidelines: They define the reserving practices which must be conducted by each subsidiary including aspects of assumptions and estimates. This includes the organization and structure, data, methods, and reporting. The Allianz Group Actuarial Department monitors compliance with these standards and guidelines.
Regular site visits: The Allianz Group Actuarial Department regularly visits Allianz subsidiaries in order to ensure that they apply the group-wide standards and guidelines. The on-site review focuses on all significant changes in assumptions and methodologies as well as on procedures and professional practices relevant for the reserving process. Furthermore, these meetings are to update knowledge of the underlying local business developments.
Stage two: The Allianz Group Actuarial Department regularly reviews the local reserving processes, including the appropriateness and consistency of assumptions, and analyzes the movements of reserves. Any adjustments to reserves and other insurance-related reporting items are reported to and analyzed together with the Allianz Group Reserve Committee.
applied and management decisions to be taken in order to establish appropriate values for these assets and liabilities. Any change in the assumptions and estimates could, in certain circumstances, significantly affect the reported results and values because the range of reasonable judgment in some cases may be very large. The Allianz Group understands the degree of impact that these judgments may have and has established a strong system of governance as well as controls, procedures and guidelines to ensure consistency and soundness over these judgments.
Subsidiaries of the Allianz Group are required to establish controls which promote a culture of good judgment and sound decisionmaking around accounting estimates. These include providing training programs, hiring people with the right background for the job (i.e. certified or experienced accountants, actuaries and finance professionals ), and providing formalized policies and procedures manuals for accounting and internal controls.
reserVes for Loss aND Loss aDJustmeNt eXpeNses, reserVes for iNsuraNCe aND iNVestmeNt CoNtraCts aND DeferreD aCQuisitioN Costs As of 31 December 2014, the Allianz Group reported:1
− reserves for loss and loss adjustments expenses of € 68,989 mn mainly for the Property-Casualty operations, including run-off business and reinsurance business assumed,
Property-Casualty reserves are set by leveraging the use of actuarial techniques and educated judgment. A two-stage process exists for the setting of reserves in the Allianz Group: Stage one: Property-Casualty reserves are calculated by local reserving actuaries in the Allianz operating entities. Reserves are set based on a thorough analysis of historical data, enhanced by interactions with other business functions (e.g. Underwriting, Claims and Reinsurance). Actuarial judgment is applied where necessary, especially in the cases where data is unreliable, scanty or unavailable. The judgment of Property-Casualty actuaries is based on past experience of the characteristics of each line of business, the current stage of the underwriting cycle and the external environment in which the subsidiary operates. The reserves are proposed to a local reserve committee, whereby the rationale of the selections are discussed and subsequently documented. A final decision on the reserve selection is made in the reserve committee. Local actuaries are responsible for their compliance with the Group Actuarial Standards and Guidelines.
− € 381,659 mn of the financial assets and € 4,135 mn of the financial liabilities carried at fair value are classified within level 2 of the fair value hierarchy (valuation techniques with mainly observable market inputs)
− € 14,037 mn of the financial assets and € 7,310 mn of the financial liabilities carried at fair value are classified within level 3 of the fair value hierarchy (valuation techniques with significant input 1 Please refer to the consolidated financial statements note 2 Summary of significant accounting policies, note 37 Impairments of investments (net) and note 44 Financial instruments for further details regarding financial instruments and impairments.
For certain investment funds managed by the Allianz Group in which the Allianz Group holds a minority stake, management has assessed that the Allianz Group controls these investment funds because of its asset management role combined with its aggregate economic interest in these investment funds.
− € 2,440 mn related to the business segment Property-Casualty − € 2,232 mn related to the business segment Life/Health − € 7,187 mn related to the business segment Asset Management and − € 307 mn related to the business segment Corporate and Other.
Goodwill represents the excess of the consideration transferred in a business combination and any non-controlling interest over the net identifiable assets acquired. Upon acquisition, goodwill is allocated to the cash generating units (CGUs) that are expected to benefit from the synergies of the acquisition. Since goodwill is not amortized, the Allianz Group must evaluate at least annually whether the carrying value per CGU is deemed recoverable. This is assumed as long as the carrying value is not in excess of the unit’s estimated recoverable amount. If it is not deemed recoverable, the excess goodwill will need to be impaired.
with regard to key value drivers, such as projected long-term combined ratios or discount rates. Furthermore, the Allianz Group reviews market-based business transaction multiples where available. This information is used to assess reasonableness since directly comparable market value information is not generally available. The Allianz Group believes that the controls over assessing the recoverability of goodwill ensure both consistent and reliable results.
DeferreD taX assets As of 31 December 2014, the Allianz Group reported deferred tax assets of € 1,046 mn. The deferred tax assets before netting with deferred tax liabilities amounted to € 17,887 mn. € 1,585 mn thereof resulted from tax losses which are carried forward to future periods.1
Deferred tax assets are determined based on tax loss carry forwards, unused tax credits and on deductible temporary differences between the Allianz Group’s carrying amounts of assets and liabilities in its consolidated balance sheet and their tax bases. Deferred tax assets are recognized only to the extent it is probable that sufficient future taxable income will be available for their realization. Assessments as to the recoverability of deferred tax assets require the use of judgment regarding assumptions related to estimated future taxable profits. This includes the character and amounts of taxable future profits, the periods in which those profits are expected to occur as well as the availability of tax planning opportunities.
2 Please refer to note 2 Summary of significant accounting policies and note 48 Pensions and similar obligations for further details.
Liabilities for pension and similar obligations and related net pension expenses are determined in accordance with actuarial valuation models. These valuations rely on extensive assumptions. Key assumptions including discount rates, inflation rates, compensation increases, pension increases and rates of medical cost trends are defined centrally at the Allianz Group level considering the circumstances in the particular countries. In order to ensure their thorough and consistent determination, all input parameters are discussed and defined, taking into consideration economic developments, peer reviews as well as currently available market and industry data. The discount rate assumptions are determined by reference to yields of high-quality corporate bonds of appropriate duration and currency at the balance sheet date. In countries where there is no deep market in such bonds, market yields on government bonds are generally used as discount rates.
Provisions for restructuring programs are recognized when the Allianz Group has a detailed formal plan for the restructuring and has raised a valid expectation in those affected that it will carry out the restructuring by starting to implement the plan or by announcing its main features. The detailed formal plan of a restructuring program is based on several estimates and assumptions, such as the number of employees to be dismissed, amount of severance payments, impacts of onerous contracts, possibilities of sub-leases, timing of the various steps of the program and in consequence timing of the expected cash flows.
Generally, the subsidiaries which are undertaking the restructuring program, set up a formal plan and determine all underlying estimates and assumptions. Therefore, it is the Allianz Group’s policy that the subsidiaries are responsible for an adequate planning process, controlling the execution of the program, and for the fulfillment of all requirements of IFRS. The respective documentation has to be submitted to the Allianz Group Accounting and Reporting department, where qualified staff members review all restructuring programs.
This includes a review of all estimates and assumptions, and an assessment of whether all requirements for setting up a restructuring provision are satisfied, including which cost components can be treated as restructuring charges.
3 Please refer to note 2 Summary of significant accounting policies and note 50 Restructuring plans for further details.
Annual Report 2014 Allianz Group 171 4 – Recently adopted and issued accounting pronouncements recently adopted accounting pronouncements effective 1 January 2014 iFrss 10, 11, 12, Amendments to ias 27 and 28 – Consolidation As of 1 January 2014, the Allianz Group implemented IFRSs 10, 11 and 12 as well as amendments to IAS 27 and IAS 28.
The following table presents the impacts of the implementation of IFRS 10 on the consolidated balance sheet as of 31 December 2013.
cHange oF consolidated Balance sHeet as oF 31 decemBer 2013 relating to tHe implementation oF iFrs 10 € mn as of 31 December 2013 As previously reported Adoption of iFrs 10 As reported
The adoption of IFRS 10 required the additional consolidation of certain investment funds where the Allianz Group has the ability to direct the relevant asset management activities without having a majority investment. In contrast, numerous third-party managed investment funds in which the Allianz Group has invested were deconsolidated to the extent that the Allianz Group cannot exercise power. Furthermore, IFRS 10 led to the deconsolidation of certain investment funds related to unit-linked contracts because investment decisions over these assets are not in the discretion of the
Allianz Group. In total, these changes in the scope of consolidation led to a reduction of the balance sheet total of € 452 mn as of the date IFRS 10 was adopted.
IFRS 11, Joint Arrangements, superseded IAS 31, Interests in Joint Ventures, and SIC-13, Jointly Controlled Entities – Non-Monetary Contributions by Ventures. The IFRS requires a party to a joint arrangement to determine the type of joint arrangement in which it is involved by assessing its rights and obligations arising from the arrangement. The IFRS classifies joint arrangements into two types: joint operations and joint ventures. For joint operations the reporting entity has to recognize and measure the assets and liabilities (and recognize the related revenues and expenses) in relation to its interest in the arrangement in accordance with relevant IFRSs applicable to the particular assets, liabilities, revenues and expenses. In contrast, for joint ventures the reporting entity has to recognize an investment and to account for that investment using the equity method in accordance with IAS 28. The application of IFRS 11 had no material impact on the financial position and the financial results of the Allianz Group.
Further adopted accounting pronouncements In addition to the implementation of IFRSs 10, 11, 12 and the amendments to IAS 27 and IAS 28 the following amendments and revisions to existing standards became effective for the Allianz Group’s consolidated financial statements as of 1 January 2014: − IAS 36, Recoverable Amount Disclosures for Non-Financial Assets, − IAS 32, Offsetting Financial Assets and Financial Liabilities, − IAS 39, Novation of Derivatives and Continuation of Hedge
The Allianz Group adopted the revisions and amendments as of 1 January 2014, with no material impact on its financial results or financial position.
Further amendments and interpretations standard/interpretation eFFeCtiVe date iFriC 21, Levies Annual periods beginning on or after 17 June 2014 ias 1, Disclosure Initiative Annual periods beginning on or after 1 January 2016 (not yet endorsed by e.u.) ias 19, Defined Benefit Plan: Employee Contributions Annual periods beginning on or after 1 July 2014 Annual Improvements to iFrss 2010 – 2012 Annual periods beginning on or after 1 July 2014 Annual Improvements to iFrss 2011 – 2013 Annual periods beginning on or after 1 July 2014 Annual Improvements to iFrss 2012 – 2014 Annual periods beginning on or after 1 January 2016 (not yet endorsed by e.u.) iFrs 11, Accounting for Acquisitions of Interests in Joint Operations Annual periods beginning on or after 1 January 2016 (not yet endorsed by e.u.)
Annual periods beginning on or after 1 January 2016 (not yet endorsed by e.u.)
other reClassiFiCations Certain prior-period amounts have been reclassified to conform to the current period presentation.
reCentlY issued aCCountinG pronounCements effective on or after 1 January 2015 and not adopted early iFrs 9, Financial Instruments IFRS 9, Financial Instruments, was issued by the IASB in July 2014 and will replace IAS 39 with a new standard. IFRS 9 provides a new approach on how to classify financial instruments based on their cash flow characteristics and the business model under which they are managed. Furthermore, the standard introduces a new impairment model for debt instruments based on expected credit losses, while equity investments will no longer be subject to impairment under IFRS 9. The new hedge accounting rules in IFRS 9 provide more opportunities to apply hedge accounting and aim to better align risk management and accounting in order to improve the information about risk management.
Annual Report 2014 Allianz Group 173 5 – Consolidation scope oF consolidation The number of entities by type listed in the table below is included in the scope of consolidation in addition to the parent company Allianz SE.
Total number of fully consolidated entities 903 896 Number of joint ventures valued at equity 26 23 Number of associates valued at equity 58 108
Part of Property-Casualty insurance business of UnipolSai Assicurazioni S.p.A., Bologna – 1 July 2014 Property-Casualty 257 Acquisition
Part of Property-Casualty insurance business of UnipolSai Assicurazioni S.p.A., Bologna Effective 1 July 2014, the Allianz Group acquired specific distribution activities of the Property-Casualty insurance business of UnipolSai Assicurazioni S.p.A., Bologna (“Distribution Activities”). The acquired Distribution Activities include, inter alia, a network of 725 agencies
Other liabilities comprise mainly payables to agents and employees. The assumed other liabilities related to the Distribution Activities are provisional due to the pending receipt of the final valuations of those liabilities.
The aggregate consideration for the acquired Property-Casualty insurance business of UnipolSai Assicurazioni S.p.A. amounted to a maximum of € 440 mn. It includes: − a payment of € 200 mn processed on 30 June 2014; plus
Total consideration allocated to the Distribution Activities consisting of € 200 mn initial payment plus € 175 mn contingent consideration 375 Total net identifiable assets of the Distribution Activities 118
Acquisition-related costs in the amount of € 8 mn (including € 6 mn registration taxes and € 2 mn legal and consulting fees) are included in administrative expenses. Further acquisition-related costs in the amount of € 6 mn are expected to be incurred in the first quarter of 2015.
Annual Report 2014 Allianz Group 175 signiFicant acquisition aFter tHe reporting date
Property-Casualty insurance business of the Territory Insurance Office (tio), Darwin Effective 1 January 2015, the Allianz Group acquired the PropertyCasualty insurance business of the Territory Insurance Office (TIO Business), Darwin, and entered into a 10-year agreement to manage the compulsory motor accidents compensation scheme (mAC Contract ). The acquired TIO Business includes, inter alia, all relevant insurance assets and liabilities, operations, employees and the brand related to the TIO Business.
The acquired TIO Business represents insurance activities with premiums equal to approximately € 88 mn (for the year 2014). It provides the necessary scale for the Allianz Group to implement a growth strategy in Northern Australia and to respond to the relationship challenges in existing financial institution and broker partnerships because of a current lack of presence.
The preliminary total consideration paid in cash amounts to € 154 mn. This preliminary consideration was partly determined by reference to the net asset value of the TIO Business as of 30 June 2014 and is subject to change according to the movements in the net asset value of the TIO Business until 31 December 2014.
It is expected that goodwill will result from the business combination which will reflect largely the benefits associated with cost and reinsurance synergies and the ability to revert to an existing infrastructure in a new geographical market.
None of this goodwill that will be recognized is expected to be deductible for income tax purposes.
Acquisition-related costs in the amount of € 1 mn are included in administrative expenses.
general segment reportIng InformatIon Prices for transactions between reportable segments are set on an arm’s length basis in a manner similar to trans actions with third parties. Transactions between reportable segments are eliminated in the Consolidation. For the reportable segment Asset Management, interest revenues are reported net of interest expenses. Financial infor mation is recorded based on reportable segments. Cross-segmental country-specific information is not determined.
reportable segments measure of profIt or loss The Allianz Group uses operating profit to evaluate the performance of its reportable segments and the Allianz Group as a whole. Operating profit highlights the portion of income before income taxes attributable to the ongoing core operations of the Allianz Group. The Allianz Group considers the presentation of operating profit to be useful and meaningful to investors because it enhances the understanding of the Allianz Group’s underlying operating performance and the comparability of its operating performance over time.
− interest expenses from external debt, as these relate to the capital structure of the Allianz Group,
− income from fully consolidated private equity investments (net), as this represents income from industrial holdings, which is outside the Allianz Group’s normal scope of operating business,
− realized capital gains and losses (net) or impairments of investments (net), as the timing of sales that would result in such realized gains or losses is largely at the discretion of the Allianz Group and impairments are largely dependent on market cycles or issuer-specific events over which the Allianz Group has little or no control and which can vary, sometimes materially, through time,
− one-off effect from pension revaluation. Allianz SE has a joint liability for a large part of the pension provisions of its German subsidiaries. Service costs incurred in this context are reimbursed by the German subsidiaries of Allianz SE, resulting in corresponding service revenues at Allianz SE. Effective 1 January 2014, the German subsidiaries of Allianz SE changed the application of the option provided by article 67 (1) sentence 1 of the Introductory Act to the German Commercial Code (EGHGB) to distribute the conversion expenses due to the first-time application of the German Accounting Law Modernization Act ( BilMoG) in 2010 over a period of up to 15 years in the way that the conversion expenses were fully recognized in the first quarter of 2014. The resulting one-off expenses at the German subsidiaries and one-off income at Allianz SE are shown as non-operating items. In case of policyholder participation within the Life/Health insurance business, the one-off expenses and the corresponding one-off income at Allianz SE are presented within operating profit. On the Allianz Group level, the one-off expenses and income offset each other. The only impact on the Allianz Group level is the related policyholder participation, which had a positive impact of € 116 mn on operating profit and income before income taxes in 2014.
recent organIzatIonal changes Effective 1 January 2014, the Allianz Group prospectively allocated certain entities from the reportable segment Asset Management to the reportable segments German Speaking Countries, Western & Southern Europe and Growth Markets within the business segment Life/Health and to the reportable segment Banking.
In the fourth quarter of 2014, the French International Health business was reclassified from the reportable segment Western & Southern Europe (Life/Health) to the reportable segment Allianz Worldwide Partners effective as of 1 January 2014 to reflect the change in management responsibility and to bundle the international health business to provide a comprehensive product range to the customers.
Annual Report 2014 Allianz Group 179 busIness segment InformatIon – consolIdated balance sheets busIness segment InformatIon – consolIdated balance sheets € mn Property-Casualty Life/Health Asset Management Corporate and Other Consolidation Group assets
Loans and advances to banks and customers 14,963 16,131 91,411 89,922 72 449 17,547 18,166 (6,917) (7,868) 117,075 116,800 Financial assets for unit-linked contracts – – 94,564 81,064 – – – – – – 94,564 81,064
Annual Report 2014 Allianz Group 181 busIness segment InformatIon – total revenues and reconcIlIatIon of operatIng profIt (loss) to net Income (loss)
busIness segment InformatIon – total revenues and reconcIlIatIon of operatIng profIt (loss) to net Income (loss)
Operating income from financial assets and liabilities carried at fair value through income (net) 6 (75) (1,367) (1,832) 5 12 33 40 22 (14) (1,301) (1,868) Operating realized gains/losses (net) 186 70 3,204 3,294 – – – – (184) (30) 3,205 3,334 Interest expenses, excluding interest expenses from external debt (71) (52) (107) (81) (10) (28) (573) (623) 346 363 (415) (421) Operating impairments of investments (net) (20) (11) (677) (331) – – – – – 44 (697) (298)
Claims and insurance benefits incurred (net) (28,878) (27,713) (20,775) (20,096) – – – – 3 7 (49,650) (47,802) Change in reserves for insurance and investment contracts (net)2 (538) (384) (12,563) (13,555) – – – – (828) (50) (13,929) (13,990)
Reclassification of tax benefits – – – – – – – – 901 – 901 –
2 For the year ended 31 December 2014, includes expenses for premium refunds (net) in Property-Casualty of € (307) mn (2013: € (162) mn).
Acquisition and administrative expenses (net), excluding one-off effect from pension revaluation (2,564) (2,534) (2,782) (2,637) (1,035) (992) (644) (683) (3,631) (3,493) (831) (851) (924) (763) 11 11 (12,400) (11,942)
Non-operating income from financial assets and liabilities carried at fair value through income (net) (49) 12 (45) 12 2 5 (3) 2 (13) (6) (6) – – – – – (114) 25 Non-operating realized gains/losses (net) 121 114 172 216 13 18 15 5 127 153 12 10 3 3 – – 463 520 Non-operating impairments of investments (net) (35) (32) (98) (150) (2) (15) (7) – (19) (16) (7) (4) – – – – (168) (217) One-off effect from pension revaluation (530) – – – – – – – (7) – – – – – – – (537) –
151 Consolidated Balance Sheets 152 Consolidated Income Statements 153 Consolidated Statements of Comprehensive Income 154 Consolidated Statements of Changes in Equity 155 Consolidated Statements of Cash Flows 157 Notes to the Consolidated Financial Statements
German Speaking Countries Western & Southern Europe Iberia & Latin America USA1 Global Insurance Lines &
2 The 2014 analysis of the Allianz Group’s asbestos risks resulted in a reduction of reserves and a positive run-off result of € 86 mn reflected in the operating profit for 2014.
Operating impairments of investments (net) (376) (275) (293) (76) (1) (1) – 23 – – (7) (2) – – (677) (331)
Operating amortization of intangible assets (19) – – – – – – – – – – – – – (19) –
German Speaking Countries Western & Southern Europe Iberia & Latin America USA Global Insurance Lines &
Acquisition and administrative expenses (net), excluding one-off effect from pension revaluation (1,778) (1,564) (1,817) (1,795) (202) (201) (1,060) (1,054) (68) (88) (937) (902) 2 2 (5,860) (5,603)
Net fee and commission income1 6,380 7,127 Net interest income2 (3) 12 Income from financial assets and liabilities carried at fair value through income (net) 5 12 Other income 6 10 Operating revenues 6,388 7,162
Operating income from financial assets and liabilities carried at fair value through income (net) 27 31 10 8 (4) (1) – 3 33 40
Interest expenses, excluding interest expenses from external debt (317) (341) (255) (281) (2) (2) 1 – (573) (623)
Income from fully consolidated private equity investments (net) – – – – (42) (17) – – (42) (17) Interest expenses from external debt (846) (901) – – – – – – (846) (901)
Net income (loss) attributable to: Cost-income ratio1 for the reportable segment Banking in % 79.9 100.9 1 Represents investment expenses, administrative expenses (net), excluding acquisition-related expenses and one-off effect from pension revaluation, restructuring charges and other expenses divided by interest and similar income, operating income from financial assets and liabilities carried at fair value through income (net), fee and commission income, other income, interest expenses, excluding interest expenses from external debt, and fee and commission expenses.
Administrative expenses (net), excluding acquisition-related expenses and one-off effect from pension revaluation (736) (684) (438) (468) (137) (145) 1 2 (1,310) (1,295)
Income (loss) before income taxes (1,074) (1,680) 77 (69) (16) (88) – 27 (1,013) (1,810)
Debt securities 1,887 2,278 Equity securities 1,773 1,870 7 – Cash and cash equivalents cash and cash equIvalents € mn as of 31 December 2014 2013
Balances with banks payable on demand 6,657 6,574 Balances with central banks 397 449 Cash on hand 184 202 Treasury bills, discounted treasury notes, similar treasury securities, bills of exchange and checks 6,625 3,982
2 Include shares invested in Spanish banks with a fair value of € 408 MN (2013: € 402 MN).
held-to-maturIty Investments held-to-maturIty Investments € mn as of 31 December 2014 2013
unrealIzed losses on avaIlable-For-sale Investments and held-to-maturIty Investments The following table sets forth gross unrealized losses on availablefor -sale investments and held-to-maturity investments and the related fair value, broken down by investment category and length of time such investments have been in a continuous unrealized loss position as of 31 December 2014 and 2013.
unrealIzed losses on avaIlable-For-sale Investments and held-to-maturIty Investments € mn Up to 12 months Greater than 12 months Total as of 31 December Fair Value Unrealized
Government and government agency bonds 6,871 (141) 3,579 (197) 10,450 (338)
Corporate bonds Total unrealized losses amounted to € 837 mn as of 31 December 2014. The Allianz Group holds a large variety of bonds issued by corporations mostly domiciled in OECD countries. For the vast majority of the Allianz Group’s corporate bonds, issuers and/or issues are of “investment grade”. The decrease in unrealized losses of € 568 mn is spread over almost all sectors, due to a decreasing interest environment. Based on a detailed analysis of the underlying securities, the Allianz Group did not consider these investments to be impaired as of 31 December 2014.
Cost as of 1 January 13,837 12,443 Accumulated depreciation as of 1 January (3,053) (2,796) Carrying amount as of 1 January 10,783 9,646
10 – Loans and advances to banks and customers loans and advances to banks and customers € mn as of 31 December 2014 2013
Short-term investments and certificates of deposit 3,622 – 3,622 3,275 – 3,275
Collateral paid for securities borrowing transactions and derivatives 696 – 696 315 – 315 1 Primarily include covered bonds.
loans and advances to banks and customers by contractual maturIty loans and advances to banks and customers by contractual maturIty € mn as of 31 December 2014 Up to 3 months > 3 months up to 1 year > 1 year up to 3 years > 3 years up to 5 years Greater than 5 years Total
Loans and advances to banks 3,281 4,312 8,075 10,996 34,743 61,407 Loans and advances to customers 2,856 3,394 5,476 7,052 37,188 55,966
deFerred acquIsItIon costs € mn as of 31 December 2014 2013
Present value of future profits 870 1,046 Deferred sales inducements 708 807 1 The respective entities have been prospectively reclassified, effective 1 January 2014, from the business segment Asset Management to the business segment Life/Health. For further information, please see note 6.
Changes in the consolidated subsidiaries of the Allianz Group 39 (3) Foreign currency translation adjustments 82 (135)
Carrying amount as of 1 January 4,463 4,295 Foreign currency translation adjustments 430 (131) Changes recorded in the consolidated income statements 114 10 Other changes (9) 289 Carrying amount as of 31 December 4,998 4,463
Changes in the reserves for loss and loss adjustment expenses ceded to reinsurers in the business segment Property-Casualty are shown in the respective table in note 19.
Reinsurance involves credit risk and is subject to aggregate loss limits. Reinsurance does not legally discharge the respective Allianz company from primary liability under the reinsured policies. Although the reinsurer is liable to this company to the extent of the business ceded, the Allianz company remains primarily liable as the direct insurer on all the risks it underwrites, including the share that is reinsured. The Allianz Group monitors the financial condition of its reinsurers on a regular basis and reviews its reinsurance arrangements periodically in order to evaluate the reinsurer’s ability to fulfill its obligations to the Allianz Group companies under existing and planned reinsurance contracts. The Allianz Group’s evaluation criteria, which include the degree of creditworthiness, capital levels and marketplace reputation of its reinsurers, are such that the Allianz Group believes that its reinsurance credit risk is not significant, and historically has not experienced noteworthy difficulty in collecting claims from its reinsurers. Additionally, and as appropriate, the Allianz Group may also require letters of credit, deposits, or other financial guarantees to further minimize its exposure to credit risk. In certain cases, however, the Allianz Group does establish an allowance for doubtful amounts related to reinsurance as appropriate, although this amount was not significant as of 31 December 2014 and 2013. The Allianz Group primarily maintains business relations with highly rated reinsurers.
Cost as of 1 January 2,954 2,783 Accumulated amortization as of 1 January (1,908) (1,838) Carrying amount as of 1 January 1,046 945 Additions – 40 Changes in the consolidated subsidiaries of the Allianz Group – 214 Foreign currency translation adjustments 27 (57) Changes in shadow accounting (34) 20
Carrying amount as of 31 December 870 1,046 Accumulated amortization as of 31 December 2,151 1,908 Cost as of 31 December 3,021 2,954 deFerred sales Inducements deFerred sales Inducements € mn
Foreign currency translation adjustments 142 (47) Changes in shadow accounting (203) 347
Derivative financial instruments used for hedging that meet the criteria for hedge accounting and firm commitments 477 75 Property and equipment
Real estate held for own use real estate held For own use € mn
Cost as of 1 January 3,497 4,021 Accumulated depreciation as of 1 January (1,074) (1,135) Carrying amount as of 1 January 2,423 2,885
Changes in the consolidated subsidiaries of the Allianz Group – 17
Cost as of 1 January 5,632 5,057 Accumulated amortization as of 1 January (3,800) (3,467) Carrying amount as of 1 January 1,832 1,590
Changes in the consolidated subsidiaries of the Allianz Group 9 6
Cost as of 1 January 3,828 3,640 Accumulated depreciation as of 1 January (2,655) (2,673) Carrying amount as of 1 January 1,173 966
Carrying amount as of 31 December 1,291 1,173 Accumulated depreciation as of 31 December 2,580 2,655 Cost as of 31 December 3,871 3,828
Cost as of 1 January 2,005 1,804 Accumulated depreciation as of 1 January (701) (579) Carrying amount as of 1 January 1,304 1,225
Changes in the consolidated subsidiaries of the Allianz Group – 161
Impairments (1) – Carrying amount as of 31 December 1,465 1,304 Accumulated depreciation as of 31 December 815 701 Cost as of 31 December 2,280 2,005 1 Include fixed assets of wind parks, solar parks and Selecta.
4 Include primarily acquired business portfolios of € 64 MN (2013: € 76 MN) and heritable building rights of € 17 MN (2013: € 17 MN).
Assets of disposal groups classified as held for sale Münsterländische Bank Thie & Co. kg, Münster 83 – Subtotal 83 –
assets and lIabIlItIes oF dIsPosal grouPs classIFIed as held For sale During the fourth quarter of 2014, the Allianz Group decided to dispose of Münsterländische Bank Thie & Co. KG, Münster. Thus, the assets and liabilities of this consolidated entity allocated to the reportable segment Banking were reclassified as held for sale. As of 31 December 2014, no cumulative gains or losses were recognized in other comprehensive income relating to the disposal group classified as held for sale. The sale is expected to occur during the first quarter of 2015. Upon remeasurement of the disposal group at fair value less costs to sell, no impairment loss was recognized for the year ended 31 December 2014.
The investment in an associated Italian real estate company allocated to the reportable segment Western & Southern Europe (Property-Casualty) was sold as expected during the third quarter of 2014.
Disposals – – Foreign currency translation adjustments 331 (265) Impairments – (96) Carrying amount as of 31 December 12,166 11,544 Accumulated impairments as of 31 December 990 990 Cost as of 31 December 13,156 12,534
The allocated goodwill of the cash generating unit (CGU) Selecta AG was in 2013 impaired by € 96 mn in the business segment Corporate and Other. This impairment was triggered by a slower recovery of Selecta’s major European vending markets and lower multiples.
“Selecta”. The brand name “Selecta” has an indefinite life, as there is no foreseeable end to its economic life. The fair value of this brand name, registered as a trade name, was determined using a royalty savings approach.
Due to the rebranding activities of the Allianz Group in the Russian market, the brand name of the Russian People’s Insurance Society “Rosno” was amortized by € 4 mn in 2014. The brand name will be completely amortized in 2015.
− Insurance Iberia & Latin America including South America, Mexico, Portugal and Spain,
− Asia-Pacific and Middle East, − Central and Eastern Europe including Bulgaria, Croatia, Czech
The CGU in the Corporate and Other business segment consists of the CGU Selecta AG.
1 The following paragraphs include all cGUs that contain goodwill. 2 Some Asset Management entities have been allocated to the Life/Health business segment. Please refer to note 6 – Segment reporting for details.
ProPerty-casualty Insurance German Speaking Countries 287 – 284 – Insurance Western & Southern Europe 1,358 – 1,086 – Insurance Iberia & Latin America 21 – 21 – Asia-Pacific and Middle East 86 – 83 – Central and Eastern Europe 307 3 427 10 Global Insurance Lines & Anglo Markets 321 – 314 – Specialty Lines I 38 – 38 – Specialty Lines II 21 – 20 –
lIFe/health Insurance German Speaking Countries 602 – 593 – Health Germany 326 – 326 – Insurance Western & Southern Europe 656 – 633 – Asia-Pacific and Middle East 171 – 171 – Central and Eastern Europe1 23 – – – Insurance usa 454 – 436 –
For all CGUs in the Property-Casualty business segment and for the CGU Asset Management, the Allianz Group uses the discounted earnings method to derive the value in use. Generally, the basis for the determination of the discounted earnings value is the business plan (“detailed planning period”) as well as the estimate of the sustainable returns and eternal growth rates which can be assumed to be realistic on a long-term basis (“terminal value”) for the operating entities included in the CGU. The discounted earnings value is calculated by discounting the future earnings using an appropriate discount rate. The business plans applied in the value in use calculations are the results of the structured management dialogues between the Board of Management of the Allianz Group and the operating entities in connection with a reporting process integrated into these dialogues. Generally, the business plans comprise a planning horizon of three years and are based on the current market environment.
planning and controlling process. The discount rates and eternal growth rates for the CGUs in the Property-Casualty business segment are as follows: dIscount rates and eternal growth rates For the cgus In the ProPerty-casualty busIness segment
cgus in the Property-Casualty business segment Discount rate Eternal growth rate
Insurance German Speaking Countries 7.8 1.0 Insurance Western & Southern Europe 8.1 1.0 Insurance Iberia & Latin America 16.5 4.0 Asia-Pacific and Middle East 10.8 3.0 Central and Eastern Europe 9.3 1.5 Global Insurance Lines & Anglo Markets 9.0 1.5 Specialty Lines I 8.0 1.0 Specialty Lines II 8.0 1.0
For entities included in the CGUs of the business segment Life/Health, the projection of profits underlying the mCEV calculations is based on assumptions set with allowance for profit-sharing as well as a projection of unrealized capital gains and unallocated premium reserves. The profits estimated for the mCEV calculations consist of premium income, investment return on technical reserves, expenses, commissions, death and morbidity claims, surrender claims, maturity claims, increases in technical reserves, taxation and levies. For projecting future profits, assumptions have to be made on the asset performance of the operating entity. This requires consideration of the development of the market together with assumptions on the operating entity’s investment strategy as well as the current asset portfolio and allocation. The projection of investment returns includes the consideration of projection of returns for the current asset portfolio and a projection of returns for reinvestments. All assumptions have been developed by management under consideration of internal and external sources.
For the calculation of the mCEV the projected future profits are discounted using risk-neutral discount rates, as the risks are already explicitly allowed for in the market-consistent valuation. Timedependent and scenario-dependent discount factors are applied. As a reference rate, the swap yield curve with appropriate adjustments for, e.g., credit risk and illiquidity, was used for determining the mCEV. The following table provides an overview of the discount rates for the CGUs in the Life/Health business segment: reFerence rates For the cgus In the lIFe/health busIness segment cgus in the Life/Health business segment
Euro swap curve minus 10 bPs credit risk adjustment plus 13 bPs volatility adjustment chF swap curve minus 10 bPs credit risk adjustment plus 4 bPs volatility adjustment
Insurance usa Local swap curve minus 11 bPs credit risk adjustment plus 50 bPs volatility adjustment
For the CGU Selecta AG, the calculation of the recoverable amount is based on the higher of a multiple valuation and a value in use. The discount rate applied to determine the value in use is 9.6 %. The value in use results from the discounted expected sales proceeds, assuming a sale to occur in the mid-term future. The sale proceeds are estimated by using a multiple valuation. The multiple is derived from industry peer companies and management judgment and is applied to projected results derived from the internal business plan, which is mainly based on expectations regarding future economic developments in Selecta’s core markets.
In the Life/Health business segment sensitivity analyses were performed based on mCEV sensitivity testing on the reference rate. The analyses have shown that in case of a decrease in reference rates by 50 basis points the appraisal value of each CGU still exceeds its carrying value.
Financial liabilities carried at Fair value through income € mn as of 31 December 2014 2013
Term deposits and certificates of deposit 971 1,946 2,916 980 2,157 3,136
18 – Unearned premiums unearned premiums € mn as of 31 December 2014 2013
Property-Casualty 16,595 15,367 Life/Health 3,222 2,855 19 – Reserves for loss and loss adjustment expenses reserves For loss and loss adjustment expenses € mn as of 31 December 2014 2013
change in reserves For loss and loss adjustment expenses The following table reconciles the beginning and ending reserves of the Allianz Group, including the effect of reinsurance ceded, for the Property-Casualty business segment for the years ended 31 December 2014 and 2013.
Foreign currency trans lation adjustments and other changes1 2,477 (478) 1,999 (1,434) 266 (1,168) Changes in the consolidated subsidiaries of the Allianz Group – – – 132 (59) 72
Ending balance of discounted loss reserves (3,597) 326 (3,271) (3,207) 306 (2,901)
Loss payments for the individuaL accident years (per caLendar year, net)
changes in historicaL reserves for Loss and Loss adjustment expenses (Lae) The analysis of loss and LAE reserves by actuaries and management is conducted by line of business and separately for specific claim types such as asbestos and environmental claims. The origin year of losses is taken into consideration by analyzing each line of business by accident year. While this determines the estimates of reserves for loss and LAE by accident year, the effect in the consolidated income statement in the respective calendar year combines the accident year loss ratio for the current year with the favorable or adverse development from prior years (run-off).
€ mn Accident year as of 31 December 2005 & Prior 2006 2007 2008 2009 2010 2011 2012 2013 2014 Total
€ mn Accident year as of 31 December 2005 & Prior 2006 2007 2008 2009 2010 2011 2012 2013 2014 Total 1 Includes effects from foreign currency translation adjustments and other changes. 2 The total development 2014 to 2013 of € (251) mn represents the cumulative surplus from reestimating the ultimate loss for prior year claims. Considering foreign currency translation adjustments of net € 1,282 mn as well as changes in the consolidated subsidiaries and other changes of in total € 354 mn, this leads to an effective run-off result of net € 1,385 mn, which can be found in the table “Change in the reserves for loss and loss adjustment expenses” within this note.
Marine, aviation and transport insurance 1,500 1,461 105 7.2 1 In % of net reserves as of 31 December 2013.
The major highlights of the reserve developments in 2014 are discussed by line of business below. The discussion is based on net loss and LAE reserves of the relevant local operating entity before consolidation and converted into Euro for uniform presentation. Only significant developments for the Allianz Group’s major operating entities are included and therefore the amounts do not fully reconcile to the line of business totals in the above table.
contractual cash Flows As of 31 December 2014, reserves for loss and loss adjustment expenses, which are expected to be due in 2015 amounted to € 18,172 mn, those which are expected to be due between 2016 and 2019 amounted to € 18,462 mn and those which are expected to be due after 2019 to € 18,985 mn.
Motor vehicle liability insurance For motor vehicle liability insurance, net loss and LAE reserves developed favorably during 2014 by € 346 mn, or 2.3 % of reserves at 31 De cember 2013. Favorable development was seen for different effects across several operating entities. The following subsidiaries were the largest contributors: € 176 mn at Allianz Italy. The reduction was driven by favorable claim settlements due to the economic environment as well as ongoing effects of claim initiatives.
Reinsurance For reinsurance, net loss and LAE reserves developed favorably during 2014 by € 470 mn, or 6.0 % of reserves at 31 December 2013. Favorable development was seen for different effects across several operating entities. The following subsidiaries were the largest contributors: € 277 mn at Allianz Global Corporate & Specialty mainly related to the German corporate liability, property, marine and aviation segments, due to the release of IBnR based on better than expected experience.
Fire and other damage to property insurance For fire and other damage to property insurance, net loss and LAE reserves developed favorably during 2014 by € 329 mn, or 5.9 % of reserves at 31 December 2013. Favorable development was seen for different effects across several operating entities.
In establishing liabilities for A & E claims, the management considers facts currently known and the current state of the law and coverage litigation. However, given the expansion of coverage and liability by the courts and the legislatures in the past and the possibilities of similar interpretation in the future, there is significant uncertainty regarding the extent of insurer liability. As a result, the range of reasonable potential outcomes for A & E liabilities provided in these analyses is particularly large. Given this inherent uncertainty in estimating A & E liabilities, significant deviation from the currently carried A & E reserve position is possible.
While the U.S. A & E claims still represent a majority of the total A & E claims reported to the Allianz Group, the insurance industry is facing an increased prominence in exposures to A & E claims on a global basis. The Allianz Group continues to monitor these A & E exposures. During 2014, A & E liabilities decreased from € 2,711 mn to € 2,679 mn due to claim payments of € 212 mn partially offset by claims development and foreign exchange rate effects of € 181 mn.
gross and net reserves For loss and lae For a & e claims € mn as of 31 December 2014 2013 a & e net reserves 2,173 2,303 a & e gross reserves 2,679 2,711 As percentage of the Allianz Group’s Property-Casualty gross reserves 4.5 % 4.8 %
The following table shows total A & E loss activity for the years ended 31 December 2014 and 2013.
Reserves for loss and LAE as of 1 January 2,711 3,066 Loss and lae payments (212) (282) Change in reserves for loss and lae 181 (73) Reserves for loss and LAE as of 31 December 2,679 2,711 20 – Reserves for insurance and investment contracts reserves For insurance and investment contracts € mn as of 31 December 2014 2013
Foreign currency translation adjustments 9,600 (3,441) Changes in the consolidated subsidiaries of the Allianz Group – 168 Changes recorded in the consolidated income statement 3,514 4,827 Premiums collected 28,085 18,833 Separation of embedded derivatives 972 960 Interest credited 3,879 4,163 Dividends allocated to policyholders 1,356 1,360 Releases upon death, surrender and withdrawal (13,711) (13,527) Policyholder charges (1,628) (1,292) Portfolio acquisitions and disposals (52) (383) Other changes1 1,302 400
Ending balance of discounted loss reserves 3,597 3,207 As of 31 December 399,227 365,519 1 Mainly relate to insurance contracts when policyholders change their contract from a unit-linked to a universal life-type contract.
As of 31 December 2014, participating life business represented approximately 54 % (2013: 56 %) of the Allianz Group’s gross insurance in force. During the year ended 31 December 2014, participating policies represented approximately 65 % (2013: 65 %) of gross statutory premiums written and 64 % (2013: 64 %) of life premiums earned.
discounting oF reserves For loss and loss adjustment expenses In general, reserves for loss and loss adjustment expenses are not discounted, except when payment amounts are fixed and timing is reasonably determinable. As of 31 December 2014, the Allianz Group’s consolidated Property-Casualty reserves included discounted reserves of € 3,597 mn (2013: € 3,207 mn) with a total amount of the discount of € 2,232 mn (2013: € 1,957 mn). The interest rates used for discounting were in the range from 0.1 % to 5.7 % (2013: 0.6 % to 5.5 %) as of 31 December 2014.
Global Insurance Lines & Anglo Markets 73 1,877 – 6 1,883 – 1,883 reserves For premium reFunds reserves For premium reFunds € mn
As of 31 December 15,020 13,231 Latent reserves for premium refunds As of 1 January 24,541 28,052 Foreign currency translation adjustments 51 (48) Changes in the consolidated subsidiaries of the Allianz Group – 10 Changes due to fluctuations in market value 21,338 (4,337) Changes due to valuation differences charged to income 2,077 864 As of 31 December 48,006 24,541 concentration oF insurance risk in the liFe/health business segment The Allianz Group’s Life/Health business segment provides a wide variety of insurance and investment contracts to individuals and groups in over 30 countries around the world. Individual contracts include both traditional contracts and unit-linked contracts. Without taking policyholder participation into account, traditional contracts generally incorporate significant investment risk for the Allianz Group, while unit-linked contracts generally result in the contract holder assuming the investment risk. Traditional contracts include life, endowment, annuity, and health contracts. Traditional annuity contracts are issued in both deferred and immediate types. In addition, the Allianz Group’s life insurance operations in the United States issue a significant amount of equity-indexed deferred annuities. In certain markets, the Allianz Group also issues group life, group health and group pension contracts.
Furthermore, all of the Allianz Group’s annuity policies issued in the United States meet the criteria for classification as insurance contracts under IFRS 4, because they include options for contract holders to elect a life-contingent annuity. These contracts currently do not expose the Allianz Group to significant longevity risk, nor are they expected to do so in the future, as the projected and observed annuitization rates are very low. Additionally, many of the Allianz
In most of these markets, the effective interest rates earned on the investment portfolio exceed these guaranteed minimum interest rates. In addition, the operations in these markets may also have significant mortality and expense margins. However, the Allianz Group’s Life/Health operations in Switzerland, Belgium, South Korea and Taiwan have high guaranteed minimum interest rates on older contracts in their portfolios and, as a result, may be sensitive to declines in investment rates or a prolonged low interest rate environment. As of 31 December 2014, the Allianz Group has written off deferred acquisition costs and established premium deficiency reserves on the most endangered part of the portfolio in South Korea, with an overall impact of € (64) mn on the consolidated income statement. If current interest rate levels persist, further reserve strengthening for certain portfolios may become necessary.
Releases upon death, surrender and withdrawal (5,140) (4,453) (9,593) (4,689) (3,993) (8,682)
For contracts without fixed and determinable payments, the Allianz Group has made assumptions in estimating the undiscounted cash flows of contractual policy benefits including mortality, morbidity, interest crediting rates, policyholder participation in profits and future lapse rates. These assumptions represent current best estimates and may differ from the estimates used to establish the reserves for insurance and investment contracts in accordance with the Allianz Group’s established accounting policy. Due to the uncertainty of the assumptions used, the amount presented could be materially different from the actual incurred payments in future periods.
Annual Report 2014 Allianz Group 213 22 – Other liabilities other liabilities € mn as of 31 December 2014 2013
Provisions Pensions and similar obligations 9,765 7,594 Employee related 2,327 2,104 Share-based compensation plans 606 685 Restructuring plans 109 214 Loan commitments 12 42 Contingent losses from non-insurance business 134 131 Other provisions 1,684 1,617
23 – Certificated liabilities certiFicated liabilities € mn1 Contractual maturity date as of as of 31 December
Current interest rate – – – – – 0.46 % – –
1 Except for the interest rates. The interest rates represent the weighted average. 2 Includes senior bonds issued by Allianz Finance II B.V., guaranteed by Allianz SE and money market securities issued by Allianz Finance Corporation, a wholly owned subsidiary of Allianz SE, which are fully and unconditionally guaranteed by Allianz SE.
Annual Report 2014 Allianz Group 215 24 – Subordinated liabilities subordinated liabilities € mn1 Contractual maturity date as of as of 31 December
Current interest rate – – – – – 1.70 % – –
3 Change due to redemption of a € 1.5 Bn bond and the issuance of a CHF 0.5 Bn bond in the first quarter of 2014, and due to the issuance of a € 1.5 Bn bond in the third quarter of 2014.
4 € 1.0 Bn subordinated bond called for redemption effective 13 January 2015.
25 – Equity equity € mn as of 31 December 2014 2013
Non-controlling interests 2,955 2,765 1 As of 31 December 2014, include € (222) mn (2013: € (220) mn) related to treasury shares. 2 As of 31 December 2014, include € 288 mn (2013: € 203 mn) related to cash flow hedges.
issued capital Issued capital as of 31 December 2014 amounted to € 1,170 mn divided into 457,000,000 registered shares. The shares have no par value but a mathematical per share value of € 2.56 each as a proportion of the issued capital.
authorized capital As of 31 December 2014, Allianz SE had authorized capital for the issuance of 214,843,750 shares until 6 May 2019, with a notional amount of € 550 mn (Authorized Capital 2014/I). The shareholders’ subscription rights can be excluded for capital increases against contributions in kind. For a capital increase against contributions in cash, the shareholders’ subscription rights can be excluded: (i) for fractional amounts (ii) if the issue price is not significantly below the market price and the shares issued under exclusion of the subscription rights pursuant to § 186 (3) sentence 4 of the German Stock Corporation Law (Aktiengesetz) do not exceed 10 % of the share capital, and
(iii) to the extent necessary to grant a subscription right for new shares to the holders of bonds that carry conversion or option rights or provide for mandatory conversion. An overall limit for the exclusion of subscription rights of up to € 234 MN (corresponding to 20 % of the share capital at year-end 2013) applies for the Authorized Capital 2014/I and the Conditional Capital 2010/2014.
Changes in the number of issued shares outstanding number of issued shares outstanding
Number of shares Issued capital as of 31 December € mn %
The share of earnings attributable to non-controlling interests mainly consists of Euler Hermes Group companies of € 92 mn (2013: € 99 mn), PImCO of € 86 mn (2013: € 72 mn), CreditRas Vita of € 27 mn (2013: € 18 mn) and Allianz Ayudhya of € 28 mn (2013: € 31 mn). The other equity components of non-controlling interests mainly consists of Euler Hermes Group companies of € 688 mn (2013: € 672 mn), PImCO of € 235 mn (2013: € 179 mn), CreditRas Vita of € 269 mn (2013: € 274 mn) and Allianz Ayudhya of € 141 mn (2013: € 91 mn). Further information about companies with non-controlling interests are given in the list of participations of the Allianz Group.
capital requirements The Allianz Group’s capital requirements are primarily dependent on the type of business that it underwrites, the industry and geographic locations in which it operates and the allocation of the Allianz Group’s investments. During the Allianz Group’s annual planning dialogues with its operating entities, capital requirements are determined through business plans regarding the levels and timing of capital expenditures and investments. Regulators impose minimum capital requirements at the level of the Allianz Group’s operating entities and the Allianz Group as a whole.
As of 31 December 2014, the Allianz Group’s eligible capital for the solvency margin, required for the insurance segments and the Asset Management and Banking business, was € 49.8 Bn (2013: € 46.5 Bn) including off-balance sheet reserves1 of € 2.3 Bn (2013: € 2.3 Bn), surpassing the minimum legally stipulated level by € 22.2 Bn (2013: € 20.9 Bn). This margin resulted in a preliminary cover ratio of 181 % (2013: 182 %) as of 31 December 2014.2
Insurance subsidiaries of the Allianz Group including Allianz SE prepare individual financial statements based on local laws and regulations. These laws establish to some extent additional restrictions on the minimum level of capital and the amount of dividends that may be paid to shareholders. The respective local minimum capital requirements are based on various criteria including, but not limited to, volume of premiums written or claims paid, amount of 1 Off-balance sheet reserves are accepted by the authorities as eligible capital only upon request. Allianz SE has not submitted an application so far. Excluding off-balance sheet reserves, the reported solvency ratio as of 31 December 2014 would be 172 % (31 December 2013: 173 %).
With respect to dividend payments, Allianz also updated its dividend policy in 2014 by increasing the payout ratio, defining explicit budgets for external growth and linking central elements to the internal model capitalization according to Solvency II, which is expected to become regulatory binding. For further information on the dividend policy update please refer to the Outlook 2015 in the Group Management Report.
Interest from held-to-maturity investments 166 182 Dividends from available-for-sale investments 1,562 1,354 Interest from available-for-sale investments 13,609 13,202 Share of earnings from investments in associates and joint ventures 196 146 Rent from real estate held for investment 848 791 Interest from loans to banks and customers 4,868 5,067 Other interest income 193 176 26 – Premiums earned (net)
Foreign currency gains and losses are reported within income from financial assets carried at fair value through income (net) (2014: income of € 2,234 MN; 2013: expenses of € 1,506 MN). These foreign currency gains and losses arise subsequent to initial recognition on all assets and liabilities denominated in a foreign currency that are monetary items and not measured at fair value through income. The Allianz Group uses freestanding derivatives, included in the line item income (expenses) from financial assets and liabilities held for trading (net), to hedge against foreign currency fluctuations (2014: expenses of € 2,502 MN; 2013: income of € 653 MN).
Additionally included in the business segment Life/Health are derivative financial instruments from German entities which relate to duration management (2014: income of € 780 MN; 2013: expenses of € 317 MN) and protection against equity fluctuations (2014: expenses of € 125 MN; 2013: income of € 34 MN), and from U.S. entities which relate to fixed-indexed annuity products and guaranteed benefits under unit-linked contracts (2014: expenses of € 1,783 MN; 2013: expenses of € 790 MN).
Investments in associates and joint ventures2 (12) (12) Real estate held for investment (4) (11) Loans and advances to banks and customers (1) (4) Non-current assets classified as held for sale (1) (3)
1 During the year ended 31 December 2014, include realized gains from the disposal of subsidiaries and businesses of € 1 mN (2013: € 48 mN).
2 During the year ended 31 December 2014, include realized losses from the disposal of subsidiaries and businesses of € 1 mN (2013: € – mN).
asset management Management fees 6,834 7,317 Loading and exit fees 670 715 Performance fees 275 510 corPorate and other Service agreements 70 62 Investment advisory and banking activities 654 625 31 – Other income other income € mn
1 This consolidation effect results from the deferred policyholder participation recognized in the result from fully consolidated private equity investments within operating profit in the Life/Health business segment that was reclassified to expenses from fully consolidated private equity investments in nonoperating profit to ensure the consistent presentation of the Allianz Group‘s operating profit.
Ceded Claims and insurance benefits paid 2,095 375 (42) 2,428 Change in loss and loss adjustment expenses 49 27 (14) 62
Claims and insurance benefits paid (31,235) (20,216) 32 (51,419) Change in loss and loss adjustment expenses 1,589 (353) 4 1,240
Ceded Claims and insurance benefits paid 2,256 462 (27) 2,691 Change in loss and loss adjustment expenses (322) 10 (3) (315)
Net Claims and insurance benefits paid (28,979) (19,753) 5 (48,727) Change in loss and loss adjustment expenses 1,267 (343) 1 925 34 – Change in reserves for insurance and investment contracts (net)
Aggregate policy reserves (238) (6,189) – (6,427) Other insurance reserves 2 (252) – (250) Expenses for premium refunds (313) (6,390) (827) (7,529)
Other insurance reserves 7 (199) – (193) Expenses for premium refunds (162) (5,951) (46) (6,159)
Additions to allowances including direct impairments (133) (166) Amounts released 68 62 Recoveries on loans previously impaired 20 18 37 – Impairments of investments (net)
Debt securities – 18 Real estate held for investment 44 22 Loans and advances to banks and customers 6 15 38 – Investment expenses investment expenses € mn
Commissions and profit received on reinsurance business ceded 448 479 Deferrals of acquisition costs 6,138 5,868 Amortization of deferred acquisition costs (6,035) (5,705)
Realized losses from disposals of real estate held for own use (7) (2) Expenses from alternative investments (103) (85) Expenses from non-current assets classified as held for sale1 (18) –
1 For the year ended 31 December 2014, consist of impairments of real estate held for own use classified as held for sale in the amount of € (18) mn. The fair value is classified as level 3 in the fair value hierarchy and based on an income approach.
Of the deferred income taxes for the year ended 31 December 2014, income of € 198 mn (2013: expenses of € 47 mn) are attributable to the recognition of deferred taxes on temporary differences, and expenses of € 15 mn (2013: € 356 mn) are attributable to tax losses carried forward. Additionally, changes of applicable tax rates due to changes in tax law produced deferred tax income of € 26 mn (2013: € 2 mn).
For the years ended 31 December 2014 and 2013, the income taxes relating to components of other comprehensive income consist of the following: inCome taxes relating to Components of other Comprehensive inCome € mn
Foreign currency translation adjustments 124 (23) Available-for-sale investments (2,820) 1,451 Cash flow hedges (40) 21 Share of other comprehensive income of associates and joint ventures (1) 6
The recognized income taxes for the year ended 31 December 2014 are € 391 mn below (2013: € 418 mn above) the calculated income taxes based on income before income taxes multiplied by the respective applicable country-specific tax rates. The following table shows the reconciliation from the calculated income taxes based on income before income taxes multiplied by the respective applicable countryspecific tax rates to the effectively recognized taxes of the Allianz Group. The Allianz Group’s reconciliation is a summary of the individual company-related reconciliations which are based on the
Annual Report 2014 Allianz Group 225 respective country-specific tax rates after taking into consideration consolidation effects with an impact on the Group result. The applicable tax rate used in the reconciliation for domestic Allianz Group companies includes corporate tax, trade tax and the solidarity sur-
In 2014, Allianz Leben received a favorable decision of the German Federal Tax Court (BFH) effecting that losses recognized in 2002 on equity investments held via investment funds were considered tax deductible. This court decision led in 2014 to a tax benefit for the Group of € 229 mn and for the policyholders of € 892 mn. The tax benefit from this court decision consisted of current taxes and deferred taxes (mainly on tax losses carried forward) in respect of the financial year 2014 and previous years. In the tax reconciliation for 2014, the other effects of € (740) mn include € (846) mn current and deferred taxes for prior years resulting from the above-mentioned court decision. The tax benefits for prior years resulting from this court decision led to a reduction of the effective tax rate 2014 by 9 %, of which 7 % was allocated to the policyholders and 2 % remained with the shareholders. The effective tax rate 2014 remaining with shareholders is 32 %.
Deferred tax assets on losses carried forward are recognized to the extent to which it is more likely than not that sufficient future taxable profits will be available for realization. Entities which suffered a tax loss in either the current or the preceding period recognized deferred tax assets in excess of deferred tax liabilities amounting to € 375 mn (2013: € 149 mn).
Deferred tax assets Financial assets carried at fair value through income 53 23
Deferred acquisition costs 1,759 1,158 Other assets 1,283 1,363 Intangible assets 166 119 Tax losses carried forward 2,435 2,213 Insurance reserves 4,616 3,862 Pensions and similar obligations 4,353 3,317 Other liabilities 871 1,059 Total deferred tax assets 18,738 16,206 Non-recognition or valuation allowance for deferred tax assets on tax losses carried forward (850) (652) Effect of netting (16,841) (14,047) Net deferred tax assets 1,046 1,508 Deferred tax liabilities Financial assets carried at fair value through income 128 159
Tax losses carried forward are scheduled according to their expiry periods as follows: tax losses Carried forward € mn >10 years 282 Unlimited 9,422 Total 10,521
Derivative financial instruments € mn as of 31 December 2014 2013
The table above shows the fair value and notional amounts for all freestanding derivatives as well as derivatives for which hedge accounting is applied by the Allianz Group as of 31 December 2014 and 2013, respectively. The notional principal amounts indicated in the table are cumulative as they include the absolute value of the notional principal amounts of derivatives with positive and negative fair values. Although these notional principal amounts reflect the degree of the Allianz Group’s involvement in derivative transactions, they do not represent amounts exposed to risk. Further information on the use of derivatives to hedge risks can be found in the sections on market and credit risk in the Risk and Opportunity Report which forms part of the Group Management Report.
freestanDing Derivative financial instruments As of 31 December 2014, freestanding derivatives, included in the line item financial assets and liabilities held for trading, had a notional principal amount of € 297.2 bn (2013: € 233.0 bn), as well as a positive fair value of € 1.6 bn (2013: € 2.0 bn) and a negative fair value of € 8.5 bn (2013: € 6.0 bn). Out of the total allocated to the freestanding derivatives, € 189.2 bn (2013: € 115.6 bn) of the notional principal relate to annuity products. These products are equity-indexed or contain certain embedded options or guarantees which are considered embedded derivatives under IAS 39. For these embedded derivatives, the notional principal amounts included in the table refer to the account value of the related insurance contracts. The total negative fair value of these embedded derivatives amounts to € 6.7 bn (2013: € 4.2 bn). Further information on the fair value measurement of these derivatives, can be found in note 44 – Financial instruments and fair value measurement.
Fair value hedges The Allianz Group uses fair value hedges to hedge the exposure to changes in the fair value of financial assets due to movements in interest or exchange rates. As of 31 December 2014, the derivative financial instruments used for the related fair value hedges of the Allianz Group had a total negative fair value of € 157 mn (2013: € 126 mn). Within the Allianz Group’s Banking business, derivatives to hedge against interest rate changes are implemented for individual transactions (micro hedges) or for a portfolio of similar assets or liabilities (macro hedges).
Additionally, the Allianz Group uses fair value hedges to hedge its equity portfolio against equity market risk. As of 31 December 2014, the derivatives used as hedging instruments in the related fair value hedges had a total positive fair value of € 21 mn (2013: total fair value of € – mn).
Cash flow hedges During the year ended 31 December 2014, cash flow hedges were used to hedge the exposure to the variability from cash flows arising from interest rate or exchange rate fluctuations as well as inflation. As of 31 December 2014, the derivative instruments utilized had a total positive fair value of € 412 mn (2013: € 41 mn). Unrealized gains and losses (net) in shareholders’ equity increased by € 84 mn (2013: decreased by € 53 mn). Amounts accumulated in the other comprehensive income are reclassified to profit or loss in the periods when the hedged item affects profit or loss. This is the case when the forecast transactions that are hedged take place.
The degree of judgment used in measuring the fair value of financial instruments closely correlates with the level of non-market observable inputs. The Allianz Group maximizes the use of observable inputs and minimizes the use of non-market observable inputs when measuring fair value. Observability of input parameters is influenced by various factors such as type of the financial instrument, whether a market is established for the particular instrument, specific transaction characteristics, liquidity as well as general market conditions.
If the fair value cannot be measured reliably, amortized cost is used as a proxy for determining fair values. As of 31 December 2014, fair values could not be reliably measured for equity investments with carrying amounts totaling € 189 mn (31 December 2013: € 214 mn). These investments are primarily investments in privately held corporations and partnerships. During the year ended 31 December 2014, such investments with carrying amounts of € 78 mn (2013: € 35 mn) were sold. The gains and losses from these disposals were immaterial.
Valuation techniques – Market observable inputs – Fair value level 2: Level 2 applies if the market for a financial instrument is not active or when the fair value is determined by using valuation techniques based on observable input parameters. Such market inputs are observable substantially over the full term of the asset or liability and include references to formerly quoted prices for identical instruments from an active market, quoted prices for identical instruments from an inactive market, quoted prices for similar instruments from active markets and quoted prices for similar instruments from inactive markets. Market observable inputs also include interest rate yield curves, volatilities and foreign currency exchange rates.
The following tables present the fair value hierarchy for financial instruments carried at fair value in the consolidated balance sheets as of 31 December 2014 and 31 December 2013.
fair value hierarchy as of 31 December 2014 (items carrieD at fair value)
Government and agency mortgage-backed securities (residential and commercial) 43 3,695 – 3,738 Corporate mortgage-backed securities (residential and commercial) – 14,146 40 14,186 Other asset-backed securities 259 4,075 218 4,552 Government and government agency bonds 29,810 162,166 39 192,016
Government and agency mortgage-backed securities (residential and commercial) – 2,602 – 2,602 Corporate mortgage-backed securities (residential and commercial) – 11,800 33 11,833 Other asset-backed securities – 3,418 212 3,630 Government and government agency bonds 35,570 127,324 56 162,950
Financial assets held for trading – Debt and equity securities The fair value is mainly determined using the market approach. In some cases, the fair value is determined based on the income approach using interest rates and yield curves observable at commonly quoted intervals.
Financial assets held for trading – Derivative financial instruments For level 2, the fair value is mainly determined based on the income approach using present value techniques and the Black-ScholesMerton model. Primary inputs to the valuation include volatilities, interest rates, yield curves, and foreign exchange rates observable at commonly quoted intervals.
The valuation techniques for these debt securities are similar. For level 2 and level 3, the fair value is determined using the market and the income approach. Primary inputs to the market approach are quoted prices for identical or comparable assets in active markets where the comparability between security and benchmark defines the fair value level. The income approach in most cases means a present value technique where either the cash flow or the discount curve is adjusted to reflect credit risk and liquidity risk. Depending on the observability of these risk parameters in the market, the security is classified in level 2 or level 3.
Financial liabilities held for trading – Derivative financial instruments For level 2, the fair value is mainly determined using the income approach. Valuation techniques applied for the income approach mainly include discounted cash flow models as well as the BlackScholes -Merton model. Main observable input parameters include volatilities, yield curves observable at commonly quoted intervals and credit spreads observable in the market.
Financial liabilities for puttable equity instruments Financial liabilities for puttable equity instruments are generally required to be recorded at the redemption amount with changes recognized in income. For level 2, the fair value is mainly determined based on the market approach and the income approach.
Available-for-sale investments – Corporate bonds Corporate bonds within available-for-sale investments classified as level 3 are mainly priced based on the income approach (€ 4.7 bn). The primary non-market observable input used in the discounted cash flow method is an option adjusted spread taken from a benchmark security. A significant yield increase of the benchmark securities in isolation could result in a decreased fair value, while a significant yield decrease could result in an increased fair value. However, a 10 % stress of the main non-market observable inputs has only an immaterial impact on fair value.
Financial liabilities held for trading Financial liabilities held for trading mainly include embedded de rivative financial instruments relating to annuity products that are priced internally using discounted cash flow models (€ 7.0 bn). A significant decrease (increase) in surrender rates, mortality rates or the utilization of annuitization benefits could result in a higher (lower) fair value. For products with a high death benefit, surrender rates may show an opposite effect. However, a 10 % stress of the main nonmarket observable inputs has only an immaterial impact on fair value.
Net gains (losses) recognized in other comprehensive income Impairments Foreign currency transla tion adjustments
Financial assets for unit-linked contracts 179 5 1 (15) – (4) – – – 166 – Total financial assets at fair value 10,180 3,325 976 (1,811) 223 787 (151) 519 (12) 14,037 2 reconciliation of level 3 financial liabilities € mn
Additions through purchases and issues Net transfers into (out of) level 3 Disposals through sales and settlements
If financial assets are measured at fair value on a non-recurring basis at the time of impairment or if fair value less cost to sell is used as the measurement basis under IFRS 5, corresponding disclosures can be found in note 37 – Impairments of investments (net) or note 41
Level 3 – Non-market observable inputs Total financial assets Held-to-maturity investments 1,182 3,525 2 4,710 Investments in associates and joint ventures 330 18 4,472 4,820 Real estate held for investment – – 16,323 16,323 Loans and advances to banks and customers 494 96,339 43,403 140,238 Real estate held for own use – – 3,646 3,646 financial liabilities Liabilities to banks and customers 7,984 1,608 14,015 23,607 fair value hierarchy as of 31 Decmeber 2013 (items not carrieD at fair value)
Liabilities to banks and customers Level 1 consists mainly of highly liquid liabilities, e.g. payables on demand. The fair value for liabilities in level 2 and level 3 is mainly derived based on the income approach using future cash flows discounted with risk-specific interest rates. Main non-market observable inputs include credit spreads. In some cases, the carrying amount (amortized cost) is considered to be a reasonable estimate of the fair value.
assets pleDgeD anD collateral The carrying amounts of the assets pledged as collateral are displayed in the following table: assets pleDgeD as collateral € mn as of 31 December 2014 2013
Within the asset management business, the Allianz Group acts as asset manager for some securitization vehicles. The assets under management of these vehicles amounted to € 2,202 mn as at 31 December 2014. Some of the affected vehicles have been set up by the Allianz Group whereas others have been set up by third parties. In this respect, the role of the Allianz Group is limited to the asset management activity. The Allianz Group has not invested in these vehicles being managed.
Investments in investment funds Considering the broad variety of investment funds across different jurisdictions, the classification of investment funds as structured entities based on the definition in IFRS 12 and current industry practice is judgmental. As a general rule, the relevant activities of an investment fund are dedicated to the fund manager via asset management agreements. In contrast, influence from investors on the relevant activities of unconsolidated funds is usually either precluded by legal or regulatory provisions or is not deemed to be substantial.
Investment funds are generally subject to stringent regulatory requirements from financial authorities in all jurisdictions across the world. Comprehensive regulation of funds protects fund investors and also serves to limit investment risk. These mechanisms result in a legal set-up of funds, agreed and accepted by investors and investment managers, that may lead to a classification as structured entities under IFRS 12.
The carrying amounts in the tables listed above represent the maximum exposure to loss for the Allianz Group from these investments. In the reporting period, the Allianz Group has not provided any financial or other support to these entities, nor has it the intention to provide such support in the future.
Investments in investment funds investments in investment funDs by asset class € mn as of 31 December 2014
Private equity funds – 5,685 5,685 Property funds – 1,531 1,531
As of the reporting date, the Allianz Group has receivables to unconsolidated investment funds being due for asset management services amounting to € 724 mn. Furthermore, the Allianz Group has commitments to invest in private equity funds and similar financial instruments totaling € 4,388 mn as of 31 December 2014.
The U.S. Department of Justice (DOJ) is conducting an investigation into whether certain employees of Fireman’s Fund Insurance Company (FFIC), a subsidiary of Allianz SE, engaged in a violation of the False Claims Act in connection with FFIC’s involvement as a provider of federal crop insurance from 1997 to 2003. The investigation concerns the issue of whether FFIC employees submitted false claims to the government through various practices, including backdating and inappropriately designating new producer status. Two former FFIC claims employees and one contract adjuster have pled guilty to assisting farmers in asserting fraudulent crop claims. The DOJ and FFIC are in negotiations to reach a final resolution of this matter. FFIC has made a proper provision for this matter.
Guarantees The guarantees issued by the Allianz Group consist of financial guarantees, indemnification contracts and performance contracts.
Information on the remuneration of Board members and transactions with these persons can be found in the Remuneration Report, starting on page 45.
As of 31 December 2014, the performance guarantees amount to € 43 mn (2013: € 169 mn), € 25 mn of which are due within one year. The collateral held amounts to € 55 mn (2013: € 36 mn).
As of 31 December 2014, the future minimum lease payments under non-cancelable operating leases were as follows: future minimum lease payments € mn
For the year ended 31 December 2014, rental expenses totaled € 322 mn (2013: € 350 mn), net of sublease rental income received of € 15 mn.
Other commitments Within the Allianz Group several entities are obliged to make contributions to an industry-specific compensation scheme. The most important ones are the following: Pursuant to §§ 124 ff. of the German Insurance Supervision Act (“Versicherungsaufsichtsgesetz” – VAG), a mandatory insurance guarantee scheme (“Sicherungsfonds”) for life insurers is implemented in Germany. Each member of the scheme is obliged to make annual contributions to the scheme as well as special payments under certain circumstances. The exact amount of obligations for each member is calculated according to the provisions of a Federal Regulation (“Sicherungsfonds-Finanzierungs-Verordnung (Leben)”
– SichLVFinV). As of 31 December 2014, the future liabilities of Allianz Lebens versicherungs-Aktiengesellschaft and its subsidiaries to the insurance guarantee scheme pursuant to the SichLVFinV amount to annual contributions of € 10.3 mn (2013: € 9.7 mn) and an obligation for special payments of, in principle, € 157 mn (2013: € 138 mn) per year.
In accordance with §§ 124 ff. of the German Insurance Supervision Act (“Versicherungsaufsichtsgesetz” - VAG), Allianz Private Krankenversicherungs-AG is a member of the mandatory insurance guarantee scheme (Sicherungsfonds) for German health insurers. In case the guarantee scheme has to resume responsibility for insurance contracts, it will collect special payments from its members to fulfill its tasks. Until today, no contributions have been requested by the scheme. As of 31 December 2014, the potential liabilities of Allianz Private Krankenversicherungs-AG to the insurance guarantee scheme amount to an obligation for special payments of € 51 mn (2013: € 48 mn).
According to the German Deposit Guarantee and Investor Compensation Act (EAEG – “Einlagensicherungs- und Anlegerentschädigungsgesetz ”) all credit institutions, investment companies and financial services institutions licensed to do business in Germany must adhere to a statutory compensation scheme. Allianz Global Investors GmbH, PImCO Deutschland GmbH and risklab GmbH are currently members of EdW (“Entschädigungseinrichtung der Wertpapierhandelsunternehmen ”, Berlin). The annual contribution is determined in consideration of each member’s scope of business. In addition, EdW may levy special contributions from its members, if the funds available to EdW are insufficient to satisfy all eligible claims. Special contributions are determined by reference to the preceding yearly contribution. For 2014, the yearly contributions for above-mentioned entities have been determined by notification from the EdW in the amount of € 2 mn (2013: € – mn). With respect to the insolvency of Phoenix Kapitaldienst GmbH, the German Federal Financial Supervisory Authority (“Bundesanstalt für Finanzdienstleistungsaufsicht ” – BaFin) has determined that certain investor claims will be covered under the compensation scheme and special contributions have been levied. In this regard, special contributions were notified by EdW to above-mentioned entities in 2014 in the amount of € 5 mn (2013: € 2 mn). The above-mentioned entities have appealed the special contributions. For received, but not yet paid notifications, and for the estimated special contribution for 2014, adequate provisions have been accrued.
48 – Pensions and similar obligations overview Retirement benefits in the Allianz Group, which are granted to employees and in Germany also to agents, are either in the form of defined benefit or defined contribution plans. For defined benefit plans, the beneficiary is granted a defined benefit by the employer or via an external entity. In contrast to defined contribution arrangements, the future cost to the employer of a defined benefit plan is not known with certainty in advance.
In the Pension Task Force the heads of Group HR, Group Accounting and Reporting, Group Treasury and Corporate Finance, Group Planning and Controlling, Group Risk and AIm met four times to provide global governance and pre-align pension-related topics prior to relevant Group Committee meetings.
Pension plans in Germany, the U.K. and Switzerland are described in more detail regarding key risks and regulatory environment, as each of them contributes more than 5 % to the Allianz Group’s defined benefit obligation or its plan assets.
Germany Germany accounts for 75.2 % of the Allianz Group’s defined benefit obligation and 62.1 % of the Allianz Group’s plan assets.
Most active German employees participate in a contributionbased system using different vehicles to cover the base salary both below and above the German social security ceiling. The Allianz Versorgungskasse VVaG (AVK) financed through employee contributions and the Allianz Pensionsverein e.V. (APV) financed by the employer, provide pension benefits for the base salary up to the German social security ceiling. Both plans are wholly funded. AVK and APV are legally separate administered pension funds with trustee boards being responsible for the investment of the assets and the risk management. AVK is subject to German insurance regulation.
Additionally, for salary above the German social security ceiling, the Allianz Group contributes to the Beitragsorientierter Pensionsvertrag (bPV). On retirement the accumulated capital is converted to a lifetime annuity. The Allianz Group decides each year whether and to which extent a bPV budget is provided. Independently from this decision an additional risk premium is paid to cover death and disability. The bPV was implemented as of 1 January 2005. Formerly existing plans were transferred to the bPV, taking the retained rights into account as appropriate. In the bPV generally the accruals after 2005 are wholly funded, whereas the grandfathered plan is funded to a minor extent. The assets, which are allocated to a trust (Methusalem Trust e.V.), are managed by a board of trustees.
There is also a partly funded defined benefit pension plan for agents (VertreterVersorgungsWerk, VVW), which has been closed for new entrants since 31 December 2011. A part of the pension plan serves as a replacement for the compensatory claim of agents according to German Commercial Code (§ 89b). The pension amount guaranteed is based on the individual agents’ insurance portfolio, which is regularly reassessed although there is no legal obligation. VVW is close to a final salary benefit and pension increases are broadly linked to inflation.
For the AVK the annual minimum interest rate guaranteed is 1.75 % – 3.50 % depending on the date of joining the Allianz Group and for the bPV it is 2.75 %. Pension increases apart from AVK are guaranteed at least with 1 % p.a. Depending on legal requirements some pension increases are linked to inflation. In AVK the complete surplus share of the retirees is used to increase their pension.
Switzerland Switzerland accounts for 4.8 % of the Allianz Group’s defined benefit obligation and 8.9 % of the Allianz Group’s plan assets.
There are obligatory corporate pension plans in Switzerland, eligible for all employees. The plans are wholly funded through legally separate trustee-administered pension funds, with the trustee board being responsible for the investment of the assets and risk management. The plans are contribution-based and cover the risks of longevity, disability and death. Employees contribute only a small amount whereas the employer contributes for the complete risk coverage and a large part of the savings components. The interest rate is decided annually by the board of the pension funds. For the mandatory part the minimum interest rate is regulated by law and reviewed annually (1.75 % in 2014). At retirement beneficiaries can choose between a lump sum payment, an annuity or a combination of both where the part which is not granted as a lump sum is converted to a fixed annuity according to the rules of the pension fund, taking legal requirements into account.
If employees contract out of the Allianz Suisse pension plan, they have to take their vested pension capital (“Freizügigkeitsleistung ”) to the next employer, which implies a small liquidity risk.
DefineD benefit plans Amounts recognized in the Allianz Group’s consolidated balance sheet for defined benefit plans are as follows: reconciliation of DefineD benefit plans on the balance sheet € mn
The following table sets out the changes in the defined benefit obligation, in the fair value of plan assets and in the effect of the asset ceiling for the various Allianz Group defined benefit plans: reconciliation of DefineD benefit obligation, plan assets anD effect of asset ceiling € mn change in DefineD benefit obligation Defined benefit obligation as of 1 January 19,110 19,161 Current service costs 398 414 Interest expenses 663 619 Plan participants’ contributions 107 106 Actuarial (gains)/losses due to
Settlement gain/(loss) 15 – Settlement payments1 (152) (1) Defined benefit obligation as of 31 December2 22,767 19,110 change in fair value of plan assets Fair value of plan assets as of 1 January 11,668 11,206 Interest income on plan assets 411 366 Return on plan assets greater/(less) than interest income on plan assets 860 46 Employer contributions 317 364 Plan participants’ contributions 107 106 Foreign currency translation adjustments 177 (70) Benefits paid3 (381) (351) Changes in the consolidated subsidiaries of the Allianz Group (4) 3
Assets distributed on settlement (31) (1) Fair value of plan assets as of 31 December 13,123 11,668 change in effect of asset ceiling4 Effect of asset ceiling as of 1 January 58 55 Interest expenses on effect of asset ceiling 1 1 Change in effect of asset ceiling in excess of interest 2 3 Foreign currency translation adjustments 1 (1) Effect of asset ceiling as of 31 December 63 58 1 These include a settlement payment of € 121 mn in South Korea for a plan change into a defined contribution pension plan.
3 In addition, the Allianz Group paid € 306 mn (2013: € 283 mn) directly to plan participants. 4 The asset ceiling is determined by taking the reduction of future contributions into account.
As of 31 December 2014, post-retirement health benefits included in the defined benefit obligation and in the net amount recognized amounted to € 13 mn (2013: € 13 mn) and € 13 mn (2013: € 13 mn), respectively.
Assumptions The assumptions for the actuarial computation of the defined benefit obligation and the recognized expense depend on the circumstances in the particular country where the plan has been established.
Plan Assets/Asset Liability Management (alm) Based on the estimated future cash flows of € 719 mn for 2015, € 716 mn for 2016, € 737 mn for 2017, € 756 mn for 2018, € 804 mn for 2019 and € 4,262 mn for 2020 – 2024, the weighted duration of the defined benefit obligation is 19.4 years. The Allianz Group uses, based on the liability profiles of the defined benefit obligation and on the regulatory funding requirements, stochastic asset liability models to optimize the asset allocation from a risk-return perspective.
Stock appreciation rights The SAR granted to a plan participant obligate the Allianz Group to pay in cash the excess of the market price of an Allianz SE share over the reference price on the exercise date for each right granted. The excess is capped at 150 % of the reference price. The reference price represents the average of the closing prices of an Allianz SE share for the ten trading days following the Financial Press Conference of Allianz SE in the year of issue. SAR which were granted up to 2008 vest after two years and expire after seven years. From the 2009 grant onwards, the SAR vest after four years and also expire after seven years. Upon vesting, the SAR may be exercised by the plan participant if the following market conditions are attained: − during their contractual term, the market price of the Allianz SE share has outperformed the Dow Jones EURO STOXX Price Index at least once for a period of five consecutive trading days; and
The fair value of the SAR at grant date is measured using a CoxRoss -Rubinstein binomial tree option pricing model. Volatility was derived from observed historical market prices. In the absence of historical information regarding employee stock appreciation exercise patterns (for the year ended 31 December 2014, the plan issued in 2008 is “out of the money”), the expected life has been estimated to equal the term to maturity of the SAR.
allianz eQuity incentive plan Since the 2011 grant year, the Allianz Equity Incentive plan (AEI plan) has replaced the GEI plans. The AEI plan is granted in the form of restricted stock units (RSU) and is part of a new variable compensation component for the plan beneficiaries.
The RSU granted to a plan participant obligate the Allianz Group to pay in cash the average closing price of an Allianz SE share on the last day of the vesting period and the prior nine trading days or to convert one RSU into one Allianz SE share. The payout is capped at a 200 % share price growth above the grant price.
Therefore, the Allianz Group accrues the fair value of the Class B equity units as a compensation expense over the vesting period. Upon vesting, any changes in the fair value of the Class B equity units are recognized as a compensation expense. During the year ended 31 December 2014, the Allianz Group recognized a compensation expense related to the Class B equity units of € (10) mn (2013: € 15 mn). In addition, the Allianz Group recognized an expense related to the priority claim on the adjusted operating profits of PImCO LLC of € 3 mn (2013: € 16 mn). The Allianz Group called a total of 3,254 Class B equity units during the year ended 31 December 2014. The total amount paid related to the call of the Class B equity units was € 143 mn.
pimco llc Class M-unit Plan In 2008, Allianz Global Investors of America L.P. ( AllianzGI L.P.) launched a new management share-based payment incentive plan for certain senior level executives and affiliates of PImCO LLC. Participants in the plan are granted options to acquire a new class of equity instruments (M-units), which vest in one-third increments on approximately the third, fourth and fifth anniversary of the option grant date. Upon vesting, options will be automatically exercised in a cashless trans action, but only if they are in the money. Participants may elect to defer the receipt of M-units through the M-unit Deferral Plan until termination of their service at the lastest. With the M-unit Plan, participants can directly participate in PImCO’S performance. Class M-units are non-voting common equity with limited information rights. They bear quarterly distributions equal to a pro-rata share of PImCO’S net distributable income. Deferred M-units have a right to receive a quarterly cash compensation equal to and in lieu of quarterly dividend payments.
Weighted average fair value of options granted € 567.49 1,047.87 Assumptions: Expected term (years) 3.84 3.84
As of 31 December 2014, the M-unit options outstanding have an exercise price of between € 11,938.35 and € 19,843.81 and a weighted average remaining contractual life of 2.77 years.
The shares settled by delivery of PImCO LLC shares are accounted for as equity-settled plans by PImCO LLC. Therefore, PImCO LLC measures the total compensation expense to be recognized for the equitysettled shares based on their fair value as of the grant date. The total compensation expense is recognized over the vesting period.
During the year ended 31 December 2014, the Allianz Group recorded a compensation expense of € 31 mn (2013: € 74 mn) related to these share options.
Allianz France share option plan Allianz France, formerly AGF, awarded options on its former Holding (AGF S.A.) quoted shares to eligible AGF Group executives, managers of subsidiaries, and some employees whose performance justified grants.
Annual Report 2014 Allianz Group 251 to sell is exercised, multiplied by a ratio representing the consideration proposed in the Tender Offer for each AGF share (€ 126.43) divided by the Allianz share price on 16 January 2007 (€ 155.72). This ratio is subject to adjustments in case of transactions impacting Allianz or AGF share capital or net equity. The cash settlement is based on the initial offer proposed for each AGF share during the Tender Offer. As of 31 December 2007, all shares issued under these plans were fully vested and exercisable.
Due to the change in settlement arising from the Liquidity Agreement, the Allianz Group accounts for the AGF share option plans as cash-settled plans, as all AGF employees will receive cash for their AGF shares. Therefore, the Allianz Group recognizes any change in the fair value of the unexercised plans as a compensation expense.
The following table shows the changes in the provisions for restructuring plans.
The development of the restructuring provisions reflects the implementation status of the restructuring initiatives. Based on the specific IFRS guidance, restructuring provisions are recognized prior to when they qualify to be recognized under the guidance for other types of provisions. In order to reflect the timely implementation of the various restructuring initiatives, restructuring provisions, as far as they are already “locked in”, are transferred to the provision type that would have been used if a restructuring initiative was not in place. This applies for each single contract. For personnel costs, at the time an employee has contractually agreed to leave the Allianz Group by signing either an early retirement, a partial retirement (Altersteilzeit, which is a specific type of an early retirement program in Germany), or a termination arrangement, the respective part of the restructuring provision is transferred to employee-related provisions. In addition, provisions for vacant office spaces that result from restructuring initiatives are transferred to “other” provisions after the offices have been completely vacated.
olDenburgische lanDesbank’s restructuring plan A change in customer demand concerning distribution channels of retail banking and a rise of regulatory costs for banking business led to a restructuring program being launched in the third quarter of 2014 in order to implement a more efficient consultancy and service structure.
For this program, restructuring charges of € 4 mn were recorded in 2014. As of 31 December 2014, restructuring provisions amounted to € 4 mn.
During the year ended 31 December 2014, restructuring charges of € 1 mn were recorded. As of 31 December 2014, restructuring provisions for this program amounted to € 12 mn.
“Zukunftsprogramm Sachversicherung” in order to generate further growth impulses. The program is expected to be completed with the objective of cost savings, improved claims management and higher growth of revenue, thereby increasing the competitiveness and profitability of Allianz Germany’s future property and casualty business.
effect of the reversal of Discounting For the year ended 31 December 2014, there was no effect of the reversal of discounting arising from the passage of time (2013: € 4 mn).
DiluteD earnings per share Diluted earnings per share are calculated by dividing net income attributable to shareholders by the weighted average number of com­ mon shares outstanding for the period, both adjusted for the effects of potentially dilutive common shares. These effects arise from vari­ ous share­based compensation plans of the Allianz Group.
Rest of Europe 70,346 71,927 Asia Pacific & Africa 21,366 20,157
The average total number of employees for the year ended 31 Decem­ ber 2014 was 147,444.
All other fees KPMG invoiced the Allianz Group an aggregate of € 6.0 Mn (2013: € 8.1 Mn) for other products and services, which consisted primarily of services under the guidance of Allianz Group management and general consulting services.
KPMG is the main auditing firm for the Allianz Group and is assigned in more than 73 % of all audit­related tasks. Auditing firms other than KPMG billed the Allianz Group an aggregate of € 16.4 Mn (2013: € 15.0 Mn).
remuneration for the BoarD of management As of 31 December 2014, the Board of Management is comprised of 11 members. The following values reflect the full Board of Manage­ ment active in the respective year.
RSU with a total fair value of € 10.6 Mn (2013: € 11.0 Mn) were granted to the Board of Management for the year ended 31 December 2014.
The Allianz Group was not subject to any subsequent events that sig­ nificantly impacted the Group financial results after the balance sheet date and before the financial statements were authorized for issue.
Allianz Private Equity Partners Verwaltungs GmbH, Munich 100.0 Allianz Private Krankenversicherungs-Aktiengesellschaft, Munich 100.0 Allianz ProzessFinanz GmbH, Munich 100.0 Allianz PV 1 Fonds, Frankfurt am Main 100.0 3 Allianz PV WS Fonds, Frankfurt am Main 100.0 3 Allianz PV-RD Fonds, Frankfurt am Main 100.0 3 Allianz Re Asia, Frankfurt am Main 100.0 3 Allianz Real Estate Germany GmbH, Stuttgart 100.0 Allianz Real Estate GmbH, Munich 100.0 Allianz Rechtsschutz-Service GmbH, Munich 100.0 Allianz Renewable Energy Management GmbH, Sehestedt 100.0 Allianz Renewable Energy Subholding GmbH & Co. KG, Sehestedt 100.0 Allianz RFG Fonds, Frankfurt am Main 100.0 3 Allianz Risk Consulting GmbH, Munich 100.0 Allianz SDR Fonds, Frankfurt am Main 100.0 3 Allianz Service Center GmbH, Munich 100.0 Allianz SOA Fonds, Frankfurt am Main 100.0 3 Allianz Taunusanlage GbR, Stuttgart 99.5 Allianz Treuhand GmbH, Stuttgart 100.0 Allianz UGD 1 Fonds, Frankfurt am Main 100.0 3 Allianz VAE Fonds, Frankfurt am Main 100.0 3 Allianz Venture Partners Beteiligungs GmbH, Munich 100.0 Allianz Versicherungs-Aktiengesellschaft, Munich 100.0 Allianz VGI 1 Fonds, Frankfurt am Main 100.0 3 Allianz VGL Fonds, Frankfurt am Main 100.0 3 Allianz VKA Fonds, Frankfurt am Main 100.0 3 Allianz VKRD Fonds, Frankfurt am Main 100.0 3 Allianz VSR Fonds, Frankfurt am Main 100.0 3 Allianz VW AV Fonds, Frankfurt am Main 100.0 3 AllianzGI-Fonds APF Renten, Frankfurt am Main 43.7 2,4 AllSecur Deutschland AG, Munich 100.0 APKV Private Equity Fonds GmbH, Munich 100.0 Atropos Vermögensverwaltungsgesellschaft mbH, Munich 100.0 AUG. PRIEN Immobilien PE Verwaltung BrahmsQuartier GmbH, Stuttgart 94.9 Auros GmbH, Munich 100.0 Auros II GmbH, Munich 100.0 AZ-Arges Vermögensverwaltungsgesellschaft mbH, Munich 100.0 AZ-Argos 14 Vermögensverwaltungsgesellschaft mbH, Munich 100.0 AZ-Argos 41 Vermögensverwaltungsgesellschaft mbH, Munich 100.0 AZ-Argos 44 Vermögensverwaltungsgesellschaft mbH & Co. KG, Munich 100.0 AZ-Argos 50 Vermögensverwaltungsgesellschaft mbH & Co. KG, Munich 100.0 AZ-Argos 51 Vermögensverwaltungsgesellschaft mbH & Co. KG, Munich 100.0 AZ-Argos 57 Vermögensverwaltungsgesellschaft mbH & Co. KG, Munich 100.0 AZ-Argos 58 Vermögensverwaltungsgesellschaft mbH & Co. KG, Munich 100.0 AZ-Argos 61 Vermögensverwaltungsgesellschaft mbH & Co. KG, Munich 100.0 AZ-Argos 64 Vermögensverwaltungsgesellschaft mbH & Co. KG, Munich 100.0 AZ-Argos 67 Vermögensverwaltungsgesellschaft mbH, Munich 100.0 AZ-Argos 68 Vermögensverwaltungsgesellschaft mbH, Munich 100.0 AZ-Argos 69 Vermögensverwaltungsgesellschaft mbH, Munich 100.0 AZ-GARI Vermögensverwaltungsgesellschaft mbH & Co. KG, Munich 100.0 AZL AI Nr. 1 GmbH, Munich 100.0
Windpark Kittlitz GmbH & Co. KG, Sehestedt 100.0 Windpark Pröttlin GmbH & Co. KG, Sehestedt 100.0 Windpark Quitzow GmbH & Co. KG, Sehestedt 100.0 Windpark Redekin-Genthin GmbH & Co. KG, Sehestedt 100.0 Windpark Schönwalde GmbH & Co. KG, Sehestedt 100.0 Windpark Waltersdorf GmbH & Co. KG Renditefonds, Sehestedt 100.0 Windpark Werder Zinndorf GmbH & Co. KG, Sehestedt 100.0
Joint ventures BEG Weser-Ems Baugrund- und Erschließungsgesellschaft mbH & Co. OHG, Oldenburg 50.0 Dealis Fund Operations GmbH, Frankfurt am Main 50.1 7
Associates AV Packaging GmbH, Munich 51.0 8 esa EuroShip GmbH & Co. KG Underwriting for Shipping, Bad Friedrichshall 40.0 Kapitalbeteiligungsgesellschaft der Deutschen Versicherungswirtschaft Aktiengesellschaft, Berlin 39.4 Mühl Product & Service und Thüringer Baustoffhandel Beteiligungs- und Verwaltungs GmbH, Kranichfeld 25.0 Reisegarant GmbH, Hamburg 24.0 Umspannwerk Putlitz GmbH & Co. KG, Frankfurt am Main 25.4
ForeiGn entities Consolidated affiliates 490 Fulton JV LP, New York, NY 96.5 490 Fulton REIT LP, New York, NY 100.0 490 Lower Unit GP LLC, New York, NY 100.0 490 Lower Unit LP, New York, NY 100.0 A.V.I.P. Assurance Vie de Prévoyance SA, Courbevoie 100.0 AB Servicios Selecta Espana S.L., Madrid 100.0 ACMAR SA, Casablanca 55.0 Administradora de Inversión Colseguros S.A., Bogotá D.C. 100.0
Advanz Fundo de Investimento Renda Fixa Crédito Privado, São Paulo 100.0 3 Aero-Fonte S.r.l., Catania 100.0 AGA Alarmcentrale NL B.V., Amsterdam 100.0 AGA Assistance (India) Private Limited, Gurgaon 100.0 AGA Assistance Australia Pty Ltd., Toowong 100.0 AGA Assistance Beijing Services Co. Ltd., Beijing 100.0 AGA Assistance Japan Co. Ltd., Tokyo 80.1 AGA Inc., Richmond, VA 100.0 AGA Insurance Broker (Thailand) Co. Ltd., Bangkok 100.0 AGA Service Company Corp., Richmond, VA 100.0 AGA Service Italia S.c.a.r.l., Milan 100.0 AGA Services (India) Private Limited, Gurgaon 100.0 AGA Services (Thailand) Co. Ltd., Bangkok 97.6 AGA Servis Hizmetleri A.S., Istanbul 97.0 AGA Sigorta Aracilik Hizmetleri LS, Istanbul 100.0 AGCS Marine Insurance Company, Chicago, IL 100.0 AGCS Resseguros Brasil S.A., Rio de Janeiro 100.0 AGF Benelux S.A., Luxembourg 100.0 AGF FCR, Paris 100.0 4 AGF Holdings (UK) Limited, Guildford 100.0 AGF Insurance Limited, Guildford 100.0 AGF Inversiones S.A., Buenos Aires 100.0 AGR Services Pte Ltd., Singapore 100.0 AIM Equity EMU 1, Paris 100.0 3 AIM Equity US, Paris 100.0 3 AIM Singapore Pte Ltd., Singapore 100.0 AIM Underwriting Limited, Toronto, ON 100.0 Allegiance Marketing Group LLC, North Palm Beach, FL 100.0 Allianz (UK) Limited, Guildford 100.0 Allianz Actio France, Paris 78.0 4 Allianz Actions Aéquitas, Paris 70.1 4 Allianz Actions Emergentes, Paris 94.3 4 Allianz Actions Euro, Paris 84.3 4 Allianz Actions Euro Convictions, Paris 92.1 4 Allianz Actions Euro MidCap, Paris 61.3 4 Allianz Actions France, Paris 73.1 4 Allianz Actions Indice Japon (couvert), Paris 57.1 4 Allianz Actions Indice US (couvert), Paris 98.4 4 Allianz Actions Internationales, Paris 99.2 4 Allianz Actions Japon, Paris 55.2 4 Allianz Actions US, Paris 81.7 4 Allianz Africa S.A., Paris 100.0 Allianz Air France IFC, Paris 100.0 4 Allianz Alapkezelõ Zrt., Budapest 100.0 Allianz America Holding B.V., Amsterdam 100.0 Allianz Amerika Aandelen Fonds, Rotterdam 83.0 4 Allianz Annuity Company of Missouri, Clayton, MO 100.0 Allianz Argentina Compañía de Seguros Generales S.A., Buenos Aires 100.0 Allianz Argentina RE S.A., Buenos Aires 100.0 Allianz Asac Actions, Paris 100.0 3 Allianz Asset Management of America Holdings Inc., Dover, DE 100.0 Allianz Asset Management of America L.P., Dover, DE 100.0 Allianz Asset Management of America LLC, Dover, DE 100.0 Allianz Asset Management U.S. Holding II LLC, Dover, DE 100.0 Allianz Australia Advantage Ltd., Sydney 100.0 Allianz Australia Employee Share Plan Pty Ltd., Sydney 100.0 Allianz Australia Insurance Limited, Sydney 100.0 Allianz Australia Life Insurance Limited, Sydney 100.0 Allianz Australia Limited, Sydney 100.0 Allianz Australia Partnership Services Limited, Sydney 100.0 Allianz Australia Services Pty Limited, Sydney 100.0 Allianz Australia Workers Compensation (NSW) Limited, Sydney 100.0 Allianz Australia Workers Compensation (Victoria) Limited, Melbourne 100.0 Allianz Australian Claims Services Limited, Sydney 100.0 Allianz Aviation Managers LLC, Burbank, CA 100.0 Allianz Ayudhya Assurance Public Company Limited, Bangkok 62.6
Allianz Bank Bulgaria AD, Sofia 99.9 Allianz Bank Financial Advisors S.p.A., Milan 100.0 Allianz Banque S.A., Courbevoie 100.0 Allianz Benelux N.V., Brussels 100.0 Allianz Bénin Assurances SA, Cotonou 83.5 Allianz Bonds Diversified Euro, Paris 100.0 3 Allianz Bonds Euro High Yield, Paris 100.0 3 Allianz Bulgaria Holding AD, Sofia 66.2 Allianz Burkina Assurances SA, Ouagadougou 60.3 Allianz Burkina Assurances Vie SA, Ouagadougou 71.8 Allianz Business Services Limited, Lancaster 100.0 Allianz business services s.r.o., Bratislava 100.0 Allianz Cameroun Assurances SA, Douala 75.4 Allianz Cameroun Assurances Vie SA, Douala 75.8 Allianz Cap ISR 2016, Paris 99.9 4 Allianz Capital Partners of America Inc., New York, NY 100.0 Allianz Carbon Investments B.V., Amsterdam 100.0 Allianz Cash SAS, Paris 100.0 Allianz Centrafrique Assurances SA, Bangui 88.3 Allianz Chicago Private Reit LP, Wilmington, DE 100.0 Allianz China General Insurance Company Ltd., Guangzhou 100.0 Allianz China Life Insurance Co. Ltd., Shanghai 51.0 Allianz Citizen Care SRI, Paris 76.0 4 Allianz Clearing S.N.C., Paris 100.0 Allianz Colombia S.A., Bogotá D.C. 100.0 Allianz Combinatie Fonds, Rotterdam 93.9 4 Allianz Compagnia Italiana Finanziamenti S.p.A., Milan 100.0 Allianz Compañía de Seguros y Reaseguros S.A., Barcelona 99.9 Allianz Congo Assurances SA, Brazzaville 100.0 Allianz Cornhill Information Services Private Ltd., Trivandrum 100.0 Allianz Côte d'Ivoire Assurances SA, Abidjan 74.1 Allianz Côte d'Ivoire Assurances Vie SA, Abidjan 71.0 Allianz Creactions 1, Paris 100.0 3 Allianz Creactions 2, Paris 100.0 3 Allianz Defensief Mix Fonds, Rotterdam 100.0 4 Allianz Discovery Asia Strategy, Senningerberg 47.0 2,4 Allianz do Brasil Participações Ltda., São Paulo 100.0 Allianz Duurzaam Wereld Aandelen Fonds, Rotterdam 55.1 4 Allianz Dynamic Asia High Yield, Senningerberg 44.8 2,4 Allianz Dynamic Global Bond, George Town 98.2 4 Allianz EDUKACJA S.A., Białobrzegi 100.0 Allianz Efficio, Paris 99.9 4 Allianz Efficio Plus, Paris 100.0 4 Allianz Egypt for Financial Investments Company S.A.E., New Cairo 100.0 Allianz Elementar Lebensversicherungs-Aktiengesellschaft, Vienna 100.0 Allianz Elementar Versicherungs-Aktiengesellschaft, Vienna 100.0 Allianz Emerging Markets Flexible Bond, Sennin-
Allianz Finance Corporation, Novato, CA 100.0 Allianz Finance II B.V., Amsterdam 100.0 Allianz Finance II Luxembourg S.à r.l., Luxembourg 100.0 Allianz Finance III B.V., Amsterdam 100.0 Allianz Finance IV Luxembourg S.à r.l., Luxembourg 100.0 Allianz Finance Obligations Monde, Paris 95.4 4 Allianz Finance Pty Ltd., Sydney 100.0 Allianz Finance VII Luxembourg S.A., Luxembourg 100.0 Allianz Finance VIII Luxembourg S.A., Luxembourg 100.0 Allianz FinanzPlan 2055, Senningerberg 83.0 4 Allianz Fire and Marine Insurance Japan Ltd., Tokyo 100.0 Allianz Foncier, Paris 60.3 4 Allianz Formuléo ISR, Paris 99.8 4 Allianz France Favart I, Paris 100.0 3 Allianz France Investissement OPCI, Paris 100.0 Allianz France Real Estate Invest SPPICAV, Paris 100.0 Allianz France Richelieu 1 S.A.S., Paris 100.0 Allianz France S.A., Paris 100.0 Allianz Fund Investments Inc., Wilmington, DE 100.0 Allianz Fund Investments S.A., Luxembourg 100.0 Allianz Garantie Fonds 3%, Rotterdam 100.0 4 Allianz Garantie Fonds 4.75%, Rotterdam 99.5 4 Allianz Garantiefonds 3.35%, Rotterdam 100.0 4 Allianz Garantiefonds 5%, Rotterdam 100.0 4 Allianz Geldmarkt Fonds, Rotterdam 62.8 4 Allianz General Insurance Company (Malaysia) Berhad p.l.c., Kuala Lumpur 100.0 Allianz General Laos Ltd., Vientiane 51.0 Allianz generalni sluzby s.r.o., Prague 100.0 Allianz Global Assistance International SA, Paris 100.0 Allianz Global Assistance New Zealand Limited, Auckland 100.0 Allianz Global Corporate & Specialty do Brasil Participações Ltda., Rio de Janeiro 100.0 Allianz Global Corporate & Specialty of Africa (Proprietary ) Ltd., Johannesburg 100.0 Allianz Global Corporate & Specialty South Africa Ltd., Johannesburg 100.0 Allianz Global Equity Selection, Senningerberg 100.0 4 Allianz Global Investors Distributors LLC, Dover, DE 100.0 Allianz Global Investors Fund Management LLC, Dover, DE 100.0 Allianz Global Investors Hong Kong Ltd., Hong Kong 100.0 Allianz Global Investors Ireland Ltd., Dublin 100.0 Allianz Global Investors Japan Co. Ltd., Tokyo 100.0 Allianz Global Investors Korea Limited, Seoul 100.0 Allianz Global Investors Nominee Services Ltd., George Town 100.0 Allianz Global Investors Schweiz AG, Zurich 100.0 Allianz Global Investors Singapore Ltd., Singapore 100.0 Allianz Global Investors Taiwan Ltd., Taipei 100.0 Allianz Global Investors U.S. Holdings LLC, Dover, DE 100.0 Allianz Global Investors U.S. LLC, Dover, DE 100.0 Allianz Global Life Ltd., Dublin 100.0 Allianz Global Risks US Insurance Company Corp., Chicago, IL 100.0 Allianz Grenelle SAS, Paris 100.0 Allianz Groen Rente Fonds, Rotterdam 100.0 4 Allianz Hayat ve Emeklilik A.S., Istanbul 89.0 Allianz Hellas Insurance Company S.A., Athens 100.0 Allianz Hold Co Real Estate S.à r.l., Luxembourg 100.0 Allianz Holding eins GmbH, Vienna 100.0 Allianz Holding France SAS, Paris 100.0 Allianz Holdings plc, Guildford 100.0 Allianz Hospitaliers Euro, Paris 100.0 3 Allianz Hospitaliers Monde, Paris 100.0 3 Allianz Hospitaliers Valeurs Durables, Paris 100.0 3 Allianz Hungária Biztosító Zrt., Budapest 100.0 Allianz IARD S.A., Paris 100.0 Allianz IARD Vintage, Paris 100.0 3 Allianz Immo, Paris 50.5 4 Allianz Indiceo 2015, Paris 100.0 4 Allianz Individual Insurance Group LLC, Minneapolis, MN 100.0
Allianz Informatique G.I.E., Paris 100.0 Allianz Informatyka Sp. z o.o., Warsaw 100.0 Allianz Infrastructure Czech HoldCo I S.à r.l., Luxembourg 100.0 Allianz Infrastructure Czech HoldCo II S.à r.l., Luxembourg 100.0 Allianz Infrastructure Luxembourg Holdco I S.A., Luxembourg 100.0 Allianz Infrastructure Luxembourg Holdco II S.A., Luxembourg 100.0 Allianz Infrastructure Luxembourg I S.à r.l., Luxembourg 100.0 Allianz Infrastructure Spain Holdco I S.à r.l., Luxembourg 100.0 Allianz Insurance (Hong Kong) Ltd., Hong Kong 100.0 Allianz Insurance Company Ghana Limited, Accra 100.0 Allianz Insurance Company Lanka Limited, Saram 100.0 Allianz Insurance Company-Egypt S.A.E., Cairo 89.0 Allianz Insurance plc, Guildford 100.0 Allianz International Equity Growth, Senningerberg 79.0 4 Allianz International Ltd., Guildford 100.0 Allianz Inversiones S.A., Bogotá D.C. 100.0 Allianz Invest 10 Division S/U, Vienna 100.0 3 Allianz Invest 11 Division Leben/Kranken, Vienna 100.0 3 Allianz Invest 12 Division Leben/Kranken, Vienna 100.0 3 Allianz Invest 50, Vienna 100.0 4 Allianz Invest Alternativ, Vienna 100.0 4 Allianz Invest d.o.o., Zagreb 100.0 Allianz Invest Kapitalanlage GmbH, Vienna 100.0 Allianz Invest Ostrent, Vienna 95.6 4 Allianz Invest Spezial 3, Vienna 100.0 3 Allianz Investment Management LLC, Minneapolis, MN 100.0 Allianz Investmentbank Aktiengesellschaft, Vienna 100.0 Allianz Investments I Luxembourg S.à r.l., Luxembourg 100.0 Allianz Investments II Luxembourg S.à r.l., Luxembourg 100.0 Allianz Investments III Luxembourg S.à r.l., Luxembourg 100.0 Allianz Investments IV Luxembourg S.à r.l., Luxembourg 100.0 Allianz Irish Life Holdings p.l.c., Dublin 66.5 Allianz kontakt s.r.o., Prague 100.0 Allianz Leasing Bulgaria AD, Sofia 51.0 Allianz Life & Annuity Company, Minneapolis, MN 100.0 Allianz Life (Bermuda) Ltd., Hamilton 100.0 Allianz Life Assurance Company-Egypt S.A.E., Cairo 100.0 Allianz Life Financial Services LLC, Minneapolis, MN 100.0 Allianz Life Insurance Co. Ltd., Seoul 100.0 Allianz Life Insurance Company Ltd., Moscow 100.0 Allianz Life Insurance Company of Missouri, Clayton, MO 100.0 Allianz Life Insurance Company of New York, New York, NY 100.0 Allianz Life Insurance Company of North America, Minneapolis, MN 100.0 Allianz Life Insurance Japan Ltd., Tokyo 100.0 Allianz Life Insurance Lanka Ltd., Colombo 100.0 Allianz Life Insurance Malaysia Berhad p.l.c., Kuala Lumpur 100.0 Allianz Life Luxembourg S.A., Luxembourg 100.0 Allianz Madagascar Assurances SA, Antananarivo 100.0 Allianz Malaysia Berhad p.l.c., Kuala Lumpur 75.0 Allianz Mali Assurances SA, Bamako 77.0 Allianz Managed Operations & Services Thailand Co. Ltd., Bangkok 100.0 Allianz Managed Operations & Services Netherlands B.V., Rotterdam 100.0 Allianz Management Services Limited, Guildford 100.0 Allianz Marine & Transit Underwriting Agency Pty Ltd., Sydney 65.0 Allianz Marine (UK) Ltd., Ipswich 100.0 Allianz Mena Holding Bermuda Ltd., Beirut 99.9 Allianz México S.A. Compañía de Seguros, Mexico City 100.0 Allianz Multi Actions Monde, Paris 95.1 4 Allianz Multi Croissance, Paris 99.9 4
Allianz Risk Consultants Inc., Los Angeles, CA 100.0 Allianz Risk Transfer (Bermuda) Ltd., Hamilton 100.0 Allianz Risk Transfer (UK) Limited, London 100.0 Allianz Risk Transfer AG, Zurich 100.0 Allianz Risk Transfer Inc., New York, NY 100.0 Allianz Risk Transfer N.V., Amsterdam 100.0 Allianz S.A. de C.V., Mexico City 100.0 Allianz S.p.A., Trieste 100.0 Allianz Saint Marc CL, Paris 100.0 4 Allianz SAS S.A.S., Bogotá D.C. 100.0 Allianz Saúde S.A., São Paulo 100.0 Allianz Scalinvest, Puteaux 98.0 4 Allianz Secteur Euro Immobilier, Paris 95.3 4 Allianz Secteur Europe Immobilier, Paris 90.9 4 Allianz Sécurité, Paris 97.4 4 Allianz Seguros de Vida S.A., Bogotá D.C. 100.0 Allianz Seguros S.A., Bogotá D.C. 100.0 Allianz Seguros S.A., São Paulo 100.0 Allianz Selectie Fonds, Rotterdam 85.3 4 Allianz Selection European Equity Dividend, Hong Kong 82.4 4 Allianz Selection Income and Growth, Hong Kong 35.2 2,4 Allianz Selection Total Return Asian Equity, Hong Kong 97.1 4 Allianz Selection US High Yield, Hong Kong 92.3 4 Allianz Selection US Income, Hong Kong 99.8 4 Allianz Sénégal Assurances SA, Dakar 83.2 Allianz Sénégal Assurances Vie SA, Dakar 95.5 Allianz Services (UK) Limited, London 100.0 Allianz Sigorta A.S., Istanbul 94.0 Allianz SNA s.a.l., Beirut 100.0 Allianz Sociedad Anónima A.S. Agencia de Seguros, Barcelona 100.0 Allianz Sociedade Gestora de Fundos de Pensões S.A., Lisbon 85.6 Allianz Société Financière S.à r.l., Luxembourg 100.0 Allianz South America Holding B.V., Amsterdam 100.0 Allianz Specialised Investments Limited, London 100.0 Allianz Specjalistyczny Fundusz Inwestycyjny Otwarty Subfunduszu Allianz 1, Warsaw 100.0 3 Allianz Specjalistyczny Fundusz Inwestycyjny Otwarty Subfunduszu Allianz 2, Warsaw 100.0 3 Allianz Subalpina Holding S.p.A., Turin 98.1 Allianz Suisse Immobilien AG, Wallisellen 100.0 Allianz Suisse Lebensversicherungs-Gesellschaft AG, Wallisellen 100.0 Allianz Suisse Rückversicherungs AG, Zurich 100.0 Allianz Suisse Versicherungs-Gesellschaft AG, Wallisellen 100.0 Allianz Taiwan Life Insurance Co. Ltd., Taipei 99.7 Allianz Telematics S.p.A., Rome 100.0 Allianz Tiriac Asigurari SA, Bucharest 52.2 Allianz Tiriac Pensii Private Societate de administrare a fondurilor de pensii private S.A., Bucharest 100.0 Allianz Togo Assurances SA, Lome 97.9 Allianz UK Credit Fund, Paris 100.0 3 Allianz UK Infrastructure Debt GP Limited, London 100.0 Allianz Ukraine LLC, Kiev 100.0 Allianz Underwriters Insurance Company Corp., Burbank, CA 100.0 Allianz US Equity Dividend, Senningerberg 90.0 4 Allianz US Investment GP LLC, Wilmington, DE 100.0 Allianz US Investment LP, Wilmington, DE 100.0 Allianz US Private REIT GP LLC, Wilmington, DE 100.0 Allianz US Private REIT LP, Wilmington, DE 100.0 Allianz Valeurs Durables, Paris 54.7 4 Allianz Vie S.A., Paris 100.0 Allianz Worldwide Care S.A., Paris 100.0 Allianz Worldwide Care Services Ltd., Dublin 100.0 Allianz Worldwide Partners S.A.S., Paris 100.0 Allianz Yasam ve Emeklilik A.S., Istanbul 80.0 Allianz Zagreb d.d., Zagreb 83.2 Allianz ZB d.o.o. Company for the Management of Obligatory Pension Funds, Zagreb 51.0
Allianz ZB d.o.o. Company for the Management of Voluntary Pension Funds, Zagreb 51.0 AllianzGI Best Styles Emerging Markets Equity Fund, Boston, MA 93.7 4 AllianzGI China Equity Fund, Boston, MA 84.9 4 AllianzGI Emerging Markets Consumer Fund, Boston, MA 100.0 4 AllianzGI Emerging Markets Debt Fund, Boston, MA 99.9 4 AllianzGI Emerging Markets Small-Cap Fund, Boston, MA 100.0 4 AllianzGI Europe Equity Growth, São Paulo 66.1 4 AllianzGI Global Fundamental Strategy Fund, Boston, MA 97.3 4 AllianzGI Global Growth Allocation Fund, Boston, MA 53.5 4 AllianzGI Global Small-Cap Opportunity Portfolio, Boston, MA 100.0 4 AllianzGI Global Sustainability Fund, Boston, MA 100.0 4 AllianzGI Multi-Asset Real Return Fund, Boston, MA 81.1 4 AllianzGI NFJ Emerging Markets Value Fund, Boston, MA 35.7 2,4 AllianzGI Retirement 2055 Fund, Boston, MA 55.5 4 AllianzGI Small-Cap Blend Fund, Boston, MA 92.1 4 AllianzGI U.S. Unconstrained Equity Portfolio, Boston, MA 100.0 4 AllianzGo S.r.l., Trieste 100.0 Allianz-Slovenská DSS a.s., Bratislava 100.0 Allianz-Slovenská poist'ovna a.s., Bratislava 99.6 Amaya Compania de Seguros y Reaseguros S.A., Madrid 100.0 American Automobile Insurance Company Corp., Earth City, MO 100.0 American Financial Marketing Inc., Minneapolis, MN 100.0 AMOS Austria GmbH, Vienna 100.0 AMOS European Services SAS, Paris 100.0 AMOS IT Suisse AG, Wallisellen 100.0 AMOS Italy S.p.c.A., Milan 100.0 AMOS of America LLC, Novato, CA 100.0 Ann Arbor Annuity Exchange Inc., Ann Arbor, MI 100.0 Antoniana Veneta Popolare Vita S.p.A., Trieste 50.0 2 APEH Europe VI, Paris 99.6 3 APKV US Private REIT GP LLC, New York, NY 100.0 APKV US Private REIT LP, New York, NY 100.0 APP Broker S.r.l., Trieste 100.0 Approfrais SA, Evreux 100.0 Arab Gulf Health Services LLC, Dubai 100.0 Arcalis Assur 5, Paris 99.9 4 Arcalis SA, Courbevoie 100.0 Arcalis UN, Paris 100.0 4 Arges Investments I N.V., Amsterdam 100.0 Arges Investments II N.V., Amsterdam 100.0 AS Selecta s.r.o., Bratislava 100.0 Asit Services S.R.L., Bucharest 100.0 Assistance Courtage d'Assurance et de Réassurance S.A., Paris 100.0 Associated Indemnity Corporation, Novato, CA 100.0 Assurances Médicales SA, Paris 65.0 Automaty Servis Selecta s.r.o., Prague 100.0 Avip Actions 100, Paris 100.0 4 Avip Actions 60, Paris 100.0 4 Avip Top Croissance, Paris 99.2 4 Avip Top Defensif, Paris 98.8 4 Avip Top Harmonie, Paris 94.7 4 AWP Romania S.A., Bucharest 100.0 AZ Euro Investments II S.à r.l., Luxembourg 100.0 AZ Euro Investments S.à r.l., Luxembourg 100.0 AZ Jupiter 4 B.V., Amsterdam 100.0 AZ Jupiter 8 B.V., Amsterdam 100.0 AZ Jupiter 9 B.V., Amsterdam 100.0 AZ Real Estate GP LLC, New York, NY 100.0 AZ Servisni centar d.o.o., Zagreb 100.0 AZ Vers US Private REIT GP LLC, New York, NY 100.0 AZ Vers US Private REIT LP, New York, NY 100.0 AZGA Insurance Agency Canada Ltd., Kitchener, ON 100.0 AZGA Service Canada Inc., Kitchener, ON 100.0
Mondial Assistance United Kingdom Ltd., Croydon Surrey 100.0 Mondial Chile Asistencia Veinticuatro Horas y Viajes Limitada, Santiago 100.0 Mondial Contact Center Italia S.r.l., Milan 100.0 Mondial Protection Corretora de Seguros Ltda., São Bernardo do Campo 100.0 Mondial Service - Belgium S.A., Brussels 100.0 Mondial Service Argentina S.A., Buenos Aires 100.0 Mondial Service Colombia SAS, Bogotá D.C. 100.0 Mondial Servicios S.A. de C.V., Mexico City 100.0 Mondial Serviços Ltda., São Bernardo do Campo 100.0 Morgan Stanley Italian Office Fund, Milan 100.0 3 National Surety Corporation, Chicago, IL 100.0 Neoasistencia Manoteras S.L., Madrid 100.0 Nextcare Bahrain Ancillary Services Company B.S.C., Manama 100.0 NEXtCARE Egypt LLC, Cairo 100.0 NEXtCARE Holding WLL, Manama 75.0 NEXtCARE Lebanon SAL, Beirut 100.0 Nextcare Tunisia S.à r.l., Tunis 100.0 NFJ Investment Group LLC, Dover, DE 100.0 Northstar Mezzanine Partners VI U.S. Feeder II L.P., Dover, DE 100.0 3 OJSC "My Clinic", Moscow 100.0 OJSC Insurance Company Allianz, Moscow 100.0 OJSC Insurance Company ROSNO-MS, Moscow 100.0 Omega Thai Investment Holding B.V., Amsterdam 100.0 Ontario Limited, Toronto, ON 100.0 OOO "IC Euler Hermes Ru", Moscow 100.0 OOO Euler Hermes Credit Management, Moscow 100.0 OOO Mondial Assistance, Moscow 100.0 OPCI Allianz France Angel, Paris 100.0 Oppenheimer Group Inc., Dover, DE 100.0 Orione PV S.r.l., Milan 100.0 Orsa Maggiore PV S.r.l., Milan 100.0 Orsa Minore PV S.r.l., Milan 100.0 OY Selecta AB, Helsinki 100.0 Pacific Investment Management Company LLC, Dover, DE 95.6 Paramount Group Real Estate Special Situations Fund-A L.P., New York, NY 100.0 Parc Eolien de Bonneuil S.à r.l., Versailles 100.0 Parc Eolien de Bruyère Grande SAS, Versailles 100.0 Parc Eolien de Croquettes SAS, Versailles 100.0 Parc Eolien de Fontfroide SAS, Versailles 100.0 Parc Eolien de Forge SAS, Paris 100.0 Parc Eolien de la Sole du Bois SAS, Paris 100.0 Parc Eolien de Longchamps SAS, Versailles 100.0 Parc Eolien des Barbes d´Or SAS, Versailles 100.0 Parc Eolien des Joyeuses SAS, Versailles 100.0 Parc Eolien des Mistandines SAS, Paris 100.0 Parc Eolien des Quatre Buissons SAS, Paris 100.0 Parc Eolien du Bois Guillaume SAS, Paris 100.0 Parc Eolien Les Treize SAS, Paris 100.0 Personalized Brokerage Service LLC, Topeka, KS 100.0 Pet Plan Ltd., Guildford 100.0 PFP Holdings Inc., Dover, DE 100.0 PGA Global Services LLC, Dover, DE 100.0 PGREF V 1301 Sixth Investors I LLC, Wilmington, DE 100.0 PGREF V 1301 Sixth Investors I LP, Wilmington, DE 100.0 PGRESS-A Equity GP LLC, Wilmington, DE 100.0 PGRESS-A Equity REIT LP, Wilmington, DE 100.0 PIMCO (Schweiz) GmbH, Zurich 100.0 PIMCO Asia Local Bond Fund, Dublin 92.0 4 PIMCO Asia Ltd., Hong Kong 100.0 PIMCO Asia Pte Ltd., Singapore 100.0 PIMCO Australia Pty Ltd., Sydney 100.0 PIMCO California Municipal Bond Fund, Boston, MA 38.4 2,4 PIMCO Canada Corp., Toronto, ON 100.0 PIMCO Canada Credit Bond Trust, Toronto, ON 100.0 4 PIMCO Canada Credit Long Bond Trust, Toronto, ON 100.0 4 PIMCO Canadian Real Return Bond Fund, Toronto, ON 53.8 4
Redoma S.à r.l., Luxembourg 100.0 Retail Vending Ltd., Birmingham 100.0 Rhea SA, Luxembourg 100.0 Risikomanagement und Softwareentwicklung GmbH, Vienna 100.0 Roster Financial LLC, Mount Laurel, NJ 100.0 SA Carène Assurance, Paris 100.0 Saint-Barth Assurances S.à r.l., St. Barts 100.0 San Francisco Reinsurance Company Corp., Novato, CA 100.0 SAS 20 pompidou, Paris 100.0 SAS Allianz Etoile, Paris 100.0 SAS Allianz Forum Seine, Paris 100.0 SAS Allianz Logistique, Paris 100.0 SAS Allianz Platine, Paris 100.0 SAS Allianz Rivoli, Paris 100.0 SAS Allianz Serbie, Paris 100.0 SAS Angel Shopping Centre, Paris 100.0 SAS Madeleine Opéra, Paris 100.0 SAS Passage Des Princes, Paris 100.0 SAS Société d'Exploitation du Parc Eolien de Nélausa, Paris 100.0 Sättravallen Wind Holding AB, Strömstad 100.0 Saudi NEXtCARE LLC, Al Khobar 52.0 SC Tour Michelet, Paris 100.0 SCI 46 Desmoulins, Paris 100.0 SCI Allianz ARC de Seine, Paris 100.0 SCI Allianz Chateaudun, Paris 100.0 SCI Allianz Messine, Paris 100.0 SCI AVIP La Templerie, Courbevoie 100.0 SCI AVIP SCPI Selection, Courbevoie 100.0 SCI ESQ, Paris 75.0 SCI Prelloyd, Paris 100.0 SCI Stratus, Courbevoie 100.0 SCI Via Pierre 1, Paris 100.0 SCI Volnay, Paris 100.0 Selecta A/S, Rodovre 100.0 Selecta AB, Stockholm 100.0 Selecta AG, Muntelier 100.0 Selecta AS, Oslo 100.0 Selecta B.V., Waardenburg 100.0 Selecta Betriebsverpflegungs GmbH, Vienna 100.0 Selecta Eesti Osauhing OÜ, Tallinn 100.0 Selecta Group B.V., Amsterdam 100.0 Selecta Group S.à r.l., Luxembourg 99.3 Selecta Holding AB, Stockholm 100.0 Selecta Holding B.V., Amsterdam 100.0 Selecta Holding Ltd., London 100.0 Selecta Holding SAS, Paris 100.0 Selecta Hungary Automataüzemeltetö Kft., Budapest 100.0 Selecta Luxembourg SA, Leudelange 100.0 Selecta Management AG, Zug 100.0 Selecta Nordic Holding AB, Stockholm 100.0 Selecta Purchasing AG, Zug 100.0 Selecta Refreshments Ltd., Dublin 100.0 Selecta SA, Zaventem 100.0 Selecta SA, Paris 99.9 Selecta TMP AG, Zug 100.0 Selecta UK Ltd., Birmingham 100.0 SI 173-175 Boulevard Haussmann SAS, Paris 100.0 SIA Baltic Payment Systems, Riga 100.0 SIA Selecta, Riga 100.0 Siac Services S.r.l., Rome 100.0 Silex Gas Management AS, Oslo 100.0 Silex Gas Norway AS, Oslo 100.0 Sirius S.A., Luxembourg 94.8 SLC "Allianz Life Ukraine", Kiev 100.0 Società Agricola San Felice S.p.A., Milan 100.0 Société de Production D'électricité D'harcourt Moulaine SAS, Versailles 100.0 Société d'Energie Eolien Cambon SAS, Versailles 100.0 Societe d'Exploitation du Parc Eolien d'Aussac Vadalle SAS, Paris 100.0
Société Européenne de Protection et de Services d'Assistance à Domicile S.A., Paris 56.0 Société Foncière Européenne B.V., Amsterdam 100.0 Société Nationale Foncière S.A.L., Beirut 66.0 SOFE One Ltd., Bangkok 100.0 SOFE Two Ltd., Bangkok 100.0 Sofiholding S.A., Brussels 100.0 South City Office Broodthaers SA, Brussels 100.0 SpaceCo S.A., Paris 100.0 Standard General Agency Inc., Dallas, TX 100.0 StocksPLUS Management Inc., Dover, DE 100.0 Téléservices et Sécurité "TEL2S" SARL, Chatillon 99.9 TFI Allianz Polska S.A., Warsaw 100.0 The American Insurance Company Corp., Cincinnati, OH 100.0 The Annuity Store Financial & Insurance Services LLC, Sacramento, CA 100.0 The MI Group Limited, Guildford 99.4 Three Pillars Business Solutions Limited, Guildford 100.0 Ticket Guard Small Amount & Short Term Insurance Co. Ltd., Tokyo 100.0 Tihama Investments B.V., Amsterdam 100.0 Top Assistance Service GmbH, Vienna 100.0 Top Immo A GmbH & Co. KG, Vienna 100.0 Top Immo Besitzgesellschaft B GmbH & Co. KG, Vienna 100.0 Top Versicherungsservice GmbH, Vienna 100.0 Top Vorsorge-Management GmbH, Vienna 75.0 Towarzystwo Ubezpieczen Euler Hermes S.A., Warsaw 100.0 Trafalgar Insurance Public Limited Company, Guildford 100.0 TU Allianz Polska S.A., Warsaw 100.0 TU Allianz Zycie Polska S.A., Warsaw 100.0 UAB Selecta, Vilnius 100.0 UP 36 SA, Brussels 100.0 UTE Gesecopri Servecarve S.r.l., Madrid 100.0 Vendcare (Holdings) Limited, Birmingham 100.0 Vendcare Services Ltd., Birmingham 100.0 VermögensManagement 2027 Plus, Senningerberg 100.0 4 VertBois S.à r.l., Luxembourg 100.0 Vigny Depierre Conseils SAS, Archamps 100.0 Viveole SAS, Versailles 100.0 Volta, Paris 100.0 4 WFC Investments Sp. z o.o., Warsaw 87.5 Windpark Les Cent Jalois SAS, Versailles 100.0 Wm. H McGee & Co. (Bermuda) Ltd., Hamilton 100.0 Wm. H McGee & Co. Inc., New York, NY 100.0 Wm. H McGee & Co. of Puerto Rico Inc., San Juan 100.0 YAO Investment S.à r.l., Luxembourg 100.0 Yorktown Financial Companies Inc., Minneapolis, MN 100.0 ZAD Allianz Bulgaria, Sofia 87.4 ZAD Allianz Bulgaria Zhivot, Sofia 99.0 ZAD Energia, Sofia 51.0
Jonit ventures A & A Centri Commerciali S.r.l., Milan 50.0 Allee-Center Kft., Budapest 50.0 Allianz C.P. General Insurance Co. Ltd., Bangkok 50.0 Ancilyze Technologies LLC, Oakbrook Terrace, IL 50.0 Atenction Integral a la Dependencia S.L., Cordoba 50.0 AZ/JH Co-Investment Venture (DC) LP, Wilmington, DE 80.0 7 AZ/JH Co-Investment Venture (IL) LP, Wilmington, DE 80.0 7 Bajaj Allianz Financial Distributors Limited, Pune 50.0 Companhia de Seguro de Créditos S.A., Lisbon 50.0 Dorcasia Ltd., Sydney 50.0 Euromarkt Center d.o.o., Ljubljana 50.0 Europe Logistics Venture 1 FCP-FIS, Luxembourg 83.3 4,7 Fiumaranuova S.r.l., Genoa 50.1 7 Guotai Jun'an Allianz Fund Management Co. Ltd., Shanghai 49.0 7 International Shopping Centre Investment S.A., Luxembourg 50.0 Israel Credit Insurance Company Ltd., Tel Aviv 50.0 Market Street Trust, Sydney 50.0 4 NET4GAS Holdings s.r.o., Prague 50.0 NRF (Finland) AB, Västeras 50.0 One Beacon Joint Venture LP, Wilmington, DE 50.0 Previndustria - Fiduciaria Previdenza Imprenditori S.p.A., Milan 50.0 SC Holding SAS, Paris 50.0 SES Shopping Center AT1 GmbH, Salzburg 50.0 Solunion Compania Internacional de Seguros y Reaseguros SA, Madrid 50.0 TopTorony Ingatlanhasznosító Zrt., Budapest 50.0
Data Quest SAL, Beirut 36.0 Douglas Emmett Partnership X LP, Santa Monica, CA 28.6 Dr. Ignaz Fiala GmbH, Vienna 33.3 European Outlet Mall Fund FCP-FIS, Luxembourg 25.1 4 Foncière des 6e et 7e arrondissements de Paris (SIIC) SA, Paris 26.5 Four Oaks Place LP, Wilmington, DE 49.0 Graydon Holding N.V., Amsterdam 27.5 Helios Silesia Holding B.V., Amsterdam 45.0 Henderson UK Outlet Mall Partnership LP, Edinburgh 19.5 8 IPE Tank and Rail Investment 1 S.C.A., Luxembourg 48.8 JPMorgan IIF UK1 LP, Dublin 24.2 Medgulf Allianz Takaful B.S.C., Seef 25.0 New Path S.A., Buenos Aires 40.0 OeKB EH Beteiligungs- und Management AG, Vienna 49.0 OJSC "Avariinyi Comissar", Moscow 23.3 OVS Opel VersicherungsService GmbH, Vienna 40.0 P H R V Paris Hotels Roissy Vaugirard SA, Paris 30.6 PAR Holdings Limited, Hamilton 22.0 PGREF V 1301 Sixth Holding LP, Wilmington, DE 24.5 PGRESS Debt Holdings LP, Wilmington, DE 20.0 PGRESS Equity Holdings LP, Wilmington, DE 20.0 Residenze CYL S.p.A., Milan 33.3 SAS Alta Gramont, Paris 49.0 SCI Bercy Village, Paris 49.0 SK Versicherung AG, Vienna 25.8 SNC Alta CRP Gennevilliers, Paris 49.0 SNC Alta CRP La Valette, Paris 49.0 SNC Société d'aménagement de la Gare de l'Est, Paris 49.0 Société de Distribution Automatique SA, Tunis 49.0 Sodor Holdings I Limited, London 30.0 Solveig Gas Holdco AS, Oslo 30.0 Wildlife Works Carbon LLC, San Francisco, CA 10.0 8
Group's consolidated financial statements. 6 Group share through indirect holder Roland Holding GmbH, 7 Classified as joint venture according to IFRS 11. 8 Classified as associate according to IAS 28. 9 Insolvent.
Euler Hermes, the world’s leading provider of trade-related insurance solutions, helps customers worldwide trade wisely and develop their business safely. With more than 100 years of experience, the company offers business-to-business (B2B) clients financial services to support cash and trade receivables management. It is the global leader in trade credit insurance and a recognized specialist in the areas of bonding, guarantees and collections. Its proprietary intelligence network tracks and analyzes daily changes in corporate solvency among companies active in markets representing 92 % of global GDP.
Couleurs de Tollens, a French paint distributor, has had its credit insured by Euler Hermes for over 20 years. However, this partnership goes beyond compensation for unpaid invoices. A crucial part of the relationship is the ongoing financial health check, where information about both customers and business prospects is exchanged. The availability of accurate solvency data on a daily basis from Euler Hermes’ extensive network is particularly valuable, as Tollens’ portfolio of their clients’ accounts receivable involves complex and voluminous credit lines. Furthermore, credit insurance helps disseminate both customer credit awareness and a culture of risk management across the Tollens group.
Hadco Metal Trading is a U.S.-based company operating in the competitive metal supply industry. For this inter- national business, the ability to make quick and accurate credit decisions can mean the difference between deals won and deals lost. Credit insurance has transformed the way Hadco does business and makes decisions. By leveraging the risk protection of its Euler Hermes policy, the company could begin to offer open terms to buyers that it would not have considered before. With Euler Hermes, the firm receives comprehensive company, sector and geographic information and analyses that help it decide how and where to grow.
269 Joint Advisory Council of the Allianz Companies 270 International Advisory Board 271 Mandates of the Members of the Supervisory Board 272 Mandates of the Members of the Board of Management 273 Glossary 277 Index
Joint Advisory Council of the Allianz Companies Prof. Dr. Dieter HunDt, Senator e.H. Chairman of the Supervisory Board Allgaier Werke GmbH
Dr. tHomaS rabe CEO & Chairman of the Executive Board Bertelsmann SE & Co. KGaA
Dr. manfreD ScHneiDer Chairman of the Supervisory Board RWE AG Linde AG
Prof. Dr. DenniS J. SnoWer President of the Kiel Institute for the World Economy
Dr.-ing. e.H. HeinricH WeiSS Chairman of the Supervisory Board SMS Holding GmbH
Dr. tHomaS enDerS Chief Executive Officer Airbus Group franz feHrenbacH Managing Partner Robert Bosch Industrietreuhand KG Chairman of the Supervisory Board Robert Bosch GmbH
International Advisory Board minoru maKiHara until 31 December 2014 Senior Corporate Advisor of Mitsubishi Corporation cHriStoPHe De margerie
Dr. Jürgen HambrecHt Chairman of the Supervisory Board of BASF SE
DR. WULf H. BERnoTaT Vice Chairman Former Chairman of the Board of Management of E.ON AG Membership in other statutory supervisory boards and SE administrative boards in Germany Bertelsmann Management SE Bertelsmann SE & Co. KGaA Deutsche Annington Immobilien SE (Chairman) Deutsche Telekom AG METRO AG
RoLf ZiMMERMann Vice Chairman Chairman of the (European) SE Works Council of Allianz SE
iRa GLoE-SEMLER Regional Representative Financial Services of ver.di Hamburg fRanZ HEiSS Employee of Allianz Beratungs- und Vertriebs-AG
JiM HaGEMann SnaBE since 7 May 2014 Chairman of Centre for Global Industries, World Economic Forum Membership in other statutory supervisory boards and SE administrative boards in Germany SAP SE since 7 July 2014 Siemens AG Membership in comparable1 supervisory bodies Bang & Olufsen A/S (Vice Chairman) Danske Bank A/S SAP Labs LLC (Group mandate SAP) until 21 May 2014 Success Factors Inc. (Group mandate SAP) until 21 May 2014 Syclo LLC (Group mandate SAP) until 21 May 2014
Mandates of the Members of the Board of Management MiCHaEL DiEKMann until 6 May 2015 Chairman of the Board of Management Membership in other statutory supervisory boards and SE administrative boards in Germany BASF SE (Vice Chairman) Linde AG (Vice Chairman) Siemens AG Membership in Group bodies Allianz Asset Management AG (Chairman) until 23 February 2015 Allianz Deutschland AG Membership in comparable1 supervisory bodies Membership in Group bodies Allianz France S.A. (Vice Chairman) Allianz S.p.A.
oLivER BäTE Insurance Western & Southern Europe until 31 December 2014 Global Property-Casualty until 6 May 2015 Chairman of the Board of Management from 7 May 2015 Membership in comparable1 supervisory bodies Membership in Group bodies Allianz France S.A.
Allianz S.p.A. (Vice Chairman since 7 February 2015) Allianz Sigorta A.S.
ManUEL BaUER Insurance Growth Markets Membership in comparable1 supervisory bodies Bajaj Allianz General Insurance Co. Ltd. Bajaj Allianz Life Insurance Co. Ltd. Membership in Group bodies Allianz Hungária Biztosító Zrt. (Chairman) Allianz-Slovenská poist‘ovna a.s. (Chairman) until 11 December 2014 Allianz Tiriac Asigurari S.A. (Chairman) OJSC IC Allianz (Chairman) until 16 March 2014 TUiR Allianz Polska S.A. (Chairman) until 30 October 2014 TU Allianz Życie Polska S.A. (Chairman) until 30 October 2014
Allianz Insurance plc (Chairman) Allianz Irish Life Holdings plc Euler Hermes S.A. (Chairman)
DR. CHRiSTof MaSCHER Operations Membership in other statutory supervisory boards and SE administrative boards in Germany Volkswagen Autoversicherung AG Membership in Group bodies Allianz Managed Operations and Services SE (Chairman) Membership in comparable1 supervisory bodies Membership in Group bodies Allianz Worldwide Partners SAS (Chairman)
Jay RaLPH Asset Management U.S. Life Insurance since 1 January 2015 Membership in comparable1 supervisory bodies Membership in Group bodies Allianz Life Insurance Company of North America (Chairman) since 1 January 2015
DR. DiETER WEMMER Finance, Controlling, Risk Membership in other statutory supervisory boards and SE administrative boards in Germany Membership in Group bodies Allianz Asset Management AG Allianz Investment Management SE
DR. MaxiMiLian ZiMMERER Investments, Global Life/Health Membership in other statutory supervisory boards and SE administrative boards in Germany Membership in Group bodies Allianz Asset Management AG Allianz Investment Management SE (Chairman) Allianz Lebensversicherungs-AG (Vice Chairman)
1 We regard memberships in other supervisory bodies as “comparable” if the company is listed on a stock exchange or has more than 500 employees.
AllowAnce for loAn losses The overall volume of provisions includes allowances for credit losses – deducted from the asset side of the balance sheet – and provisions for risks associated with contin­ gencies, such as guarantees, loan commitments or other obligations, which are stated as liabilities. Where it is determined that a loan cannot be repaid, the uncollect­ able amount is written off against any existing specific loan loss allowance, or directly recognized as an expense in the income statement. Recoveries on loans previously written off are recognized in the income statement under net loan loss provisions.
cAsh flow stAtement Statement showing movements of cash and cash equi­ valents during a reporting period, classified by three types of activity: operating activities, investing activities and financing activities.
contingent liAbilities Financial obligations not shown as liabilities on the bal­ ance sheet because the probability of a liability actually being incurred is low. Example: guarantee obligations.
deferred Acquisition costs (dAc) Expenses of an insurance company which are incurred in connection with the acquisition of new insurance policies or the renewal of existing policies. They include commissions paid, underwriting expenses and policy issuance costs.
derivAtive finAnciAl instruments Financial contracts, the values of which move in relation­ ship to the price of an underlying asset. Derivative finan­ cial instruments can be classified in relation to their un­ derlying assets (e.g. interest rates, share prices, foreign currency exchange rates or prices of goods). Important examples of derivative financial instruments are options, futures, forwards and swaps.
eArnings per shAre (eps) Ratio calculated by dividing the net income for the year attributable to shareholders by the weighted average number of shares outstanding (basic eps). In order to calculate diluted earnings per share, the number of com­ mon shares outstanding and the net income for the year attributable to shareholders are adjusted by the effects of potentially dilutive common shares which could still be exercised. Potentially dilutive common shares arise in connection with share­based compensation plans (diluted eps).
finAnciAl vAr Financial Value at Risk (VaR) is the aggregation of market risk and credit risk taking diversification benefits into account.
functionAl currency The functional currency is the prevailing currency in the primary economic environment where the subsidiary conducts its ordinary activities.
hedging The use of special financial contracts, especially derivative financial instruments, to reduce losses which may arise as a result of unfavorable movements in rates or prices.
held­to­mAturity investments Held­to­maturity investments comprise debt securities held with the intent and ability that they will be held­to­ maturity. They are valued at amortized cost.
ifrs frAmework The framework for International Financial Reporting Standards (ifrs) which sets out the concepts that underlie the preparation and presentation of financial statements for external users.
Annual Report 2014 Allianz Group 275 income from finAnciAl Assets And liAbilities cArried At fAir vAlue through income (net) Income from financial assets and liabilities carried at fair value through income (net) includes all realized and unrealized gains and losses including interest and divi­ dend income from financial assets and financial liabilities carried at fair value through income, the income (net) from financial liabilities for puttable equity instruments and the foreign currency gains and losses (net).
issued cApitAl And AdditionAl pAid­in cApitAl This heading comprises the capital stock, the premium received on the issue of shares, and amounts allocated when option rights are exercised.
Loadings & fees: Includes premium and reserve based fees, unit­linked management fees and policyholder participation in expenses. Investment margin: Is defined as ifrs investment income net of expenses less interest credited to ifrs reserves and policyholder participation. Expenses: Includes commissions, acquisition expenses and administration expenses. Technical margin: Comprises risk result (risk premiums less benefits in excess of reserves less policyholder partici­ pation), lapse result (surrender charges and commission clawbacks) and reinsurance result.
surplus funds According to Solvency ii guidance surplus funds are deemed to be accumulated profits, which have not been made available for distribution to policyholders and beneficiaries.
uneArned revenue reserves (urr) urr contain premium components that refer to future periods, which are reserved and released over the lifetime of the corresponding contracts.
Allianz Worldwide Partners 87 Alternative Investments 64, 103 Analysts 28 Asia-Pacific 87, 93 Asset Management 64, 69, 70f., 78ff., 82, 99ff., 106f.,
Cash Flows 120, 155f. Central and Eastern Europe 87, 93 Changes 48ff., 68, 84f., 108 Climate Change 75, 78 Combined Ratio 86ff.
Demographic Change 142 Digitalization 12f., 143 Directors’ dealings 39 Distribution 63ff. Diversity 76f. Dividend 10, 28f.
Annual General Meeting _______________________________ 6 May 2015 Interim Report/Financial Results 1Q ______________________ 12 May 2015 Interim Report/Financial Results 2Q ______________________ 7 August 2015 Interim Report/Financial Results 3Q ______________________ 6 November 2015 Financial Results 2015 __________________________________ 19 February 2016 Annual Report 2015 ___________________________________ 11 March 2016 Annual General Meeting _______________________________ 4 May 2016
Allianz SE – Königinstrasse 28 – 80802 Munich – Germany – Phone +49.89.3800-0 – info@allianz.com – www.allianz.com Annual Report on the internet: www.allianz.com/annualreport – Design / Concept: hw.design GmbH Photography: Andreas Pohlmann (Board of Management, Chairman of the Supervisory Board) – Date of publication: 13 March 2015 This is a translation of the German Annual Report of Allianz Group. In case of any divergences, the German original is legally binding.