WE PROTECT THE FUTURE locally, from multiple locations and on a global scale. In this way, everyone who belongs to our financial commu nity benefits.
AGCS has teams in 28 key countries globally. Our network of Allianz-owned offices in more than 70 countries, plus network partners in other locations, means we can service clients in more than 160 countries worldwide.
Fortunately, Allianz has solutions at hand for these and many other weather-related issues. For several years, Allianz Risk Transfer (ART) has offered insurance against adverse temperatures, precipitation, wind speed and sun hours to protect companies in different industries against financial losses due to lower sales or production. These creative and tailor-made weather insurance solutions are transparent and offer favorable financing terms. In case of losses, claims are handled quickly.
Revenues increased by more than 10 % and thereby exceeded the € 122 bn mark for the first time. Operating profit improved again and is now at € 10.4 bn. This means we achieved a result in the upper end of our target range. We generated net income of € 6.6 bn, of which € 6.2 bn is attributable to shareholders.
In the 2014 fiscal year, the Supervisory Board held seven meetings. The regular meetings took place in February, March, May, August, October and December. In addition, there was one extraordinary meeting in November.
ira Gloe-semler Regional Representative Financial Services of ver.di Hamburg franZ Heiss Employee of Allianz Beratungs- und Vertriebs-AG
3 Total dividend based on total amount of shares. Actual dividend payment will be reduced by the dividend amount attributable to treasury shares.
Group CapitaL CoMMittee Michael Diekmann (Chairman), Dr. Dieter Wemmer, Dr. Maximilian Zimmerer
Besides Board committees, there are also Group committees whose job it is to prepare decisions for the Board of Management of Allianz SE, submit proposals for resolutions and ensure the smooth flow of infor - mation within the Group.
The composition of the Supervisory Board of Allianz SE reflects these objectives. It has an appropriate number of independent members with international backgrounds. With four female Supervisory Board members, the goal of having 25 % female members and the intended statutory quota of 30 % in the current draft legislation for equal participation of women and men in leadership positions are both being met. The objectives will be adjusted according to the final version of the legislation. The current composition of the Supervisory Board and its committees is described on page 21.
The standards of conduct established by the Allianz Group’s Code of Conduct for Business Ethics and Compliance are obligatory for all employees worldwide. The Code of Conduct is available on our website at www.allianz.com/corporate-governance.
Allianz SE Board of Management remuneration GOVERNANCE SYSTEM The remuneration of the Board of Management is decided upon by the entire Supervisory Board based on proposals prepared by the Per­ sonnel Committee. If required, outside advice is sought from inde­ pendent external consultants. The Personnel Committee and the Supervisory Board consult with the Chairman of the Board of Man­ agement as appropriate in assessing the performance and remu­ neration of members of the Board of Management. The Chairman of the Board of Management is not present when his own remuneration is discussed. Regarding the activities and decisions taken by the Per­ sonnel Committee and the Supervisory Board, please refer to the Supervisory Board Report section. The remuneration system for the Board of Management was presented and approved at the 2010 Annual General Meeting.
3 Final payout is subject to the sustainability assessment of the Supervisory Board and may vary between 0 % and 150 % of the cumulative target values independent of the notional accruals.
INDIVIDUAL REMUNERATION: 2014 AND 2013 € THOU Michael Diekmann (Appointed: 10/1998; CEO since 04/2003) Oliver Bäte (Appointed: 01/2008) Manuel Bauer (Appointed: 01/2011)
3 Gary Bhojwani’s RSU grant will be based on his annual bonus amount of € 718 THOU. The number of RSUs will be calculated in line with the process for other USD participants by application of the 2014 fourth quarter average USD/€ exchange rate of 1.24938.
In 2014, remuneration and other benefits totaling € 6 MN (2013: € 9 MN) were paid to former members of the Board of Management and dependents, while reserves for current pension obligations and accrued pension rights totaled € 102 MN (2013: € 100 MN).
− A new pension system called “My Allianz Pension” has been introduced for new entrants beginning as of 1 January 2015 with a guarantee for the contributions paid, but no interest guaran­ tee. In addition, the new system allows for more flexibility, for example a lump­sum payment. For members of the Board of Management with existing grandfathered pension plans who were born after 31 December 1957, elements of the new pension plan are adopted as far as possible, mainly with respect to future service. In addition, for such Board of Management members, the relevant age for pension and retirement was raised to 62. The new pension plan is not applicable to those who were born before 1 January 1958. However, they are now also eligible for a lump­sum payment.
− Set a remuneration structure that takes into account the indi­ vidual functions and responsibilities of Supervisory Board mem­ bers, such as chair, vice­chair or committee mandates.
73 Sustainability management and governance 73 Trusted company 76 Committed corporate citizen 76 Attractive employer 77 Sustainable insurer 78 Responsible investor
bAnkinG operAtions Our banking operations support our insurance business and complement the products we offer in Germany, Italy, France, the Netherlands and Bulgaria. As a division of Allianz Deutschland AG, Oldenburgische Landesbank AG (OLB) is Allianz’s main own banking product and service provider in Germany. OLB, Germany’s largest private regional bank, covers the northwest of Germany and focuses on retail and corporate clients.
improving our claims management and reducing the expense ratio has led to premium growth and improved profitability. Furthermore, we will continue to extend our cooperation with the automotive industry and increase our position in the direct market under the
Effective 1 January 2015, Allianz Australia acquired the insurance operations of the Territory Insurance Office (TIO) from the regional government of the Northern Territory. Besides adding approximately AUD 130 MN in written premiums, the acquisition brings the company increased geographic diversification and forms the basis for future growth in Northern Australia. The acquisition also brings Allianz Australia a significant new source of revenue for managing the Government’s Motor Injury scheme.
PIMCO continues to focus on delivering returns and managing risks on behalf of clients across a growing range of investment solutions. It is also following its longer-term development plan to broaden its product offerings into areas such as the alternatives platform, income solutions, equities and ETFs.
Asset Management We aim to be the number one active asset manager by revenues and profitability. In 2014, Allianz defended its place among the world’s top-4 largest asset managers, irrespective of significant net outflows in the aftermath of the leadership transition at PIMCO.
Sustainability management and governance Sustainability is a constantly evolving, strategic business issue, which continues to increase in importance for all stakeholder groups. We therefore continually review and adapt our strategy, governance and organizational structures and the way we manage risks and opportunities. The Group ESG Board is a committee with Board Member leadership, with responsibility for promoting environmental, social and governance (ESG) aspects in our insurance and investment activities. Our Group-level sustainability functions deal largely with new and emerging issues in close cooperation with specific functional departments and local entities. They are comprised of two centers of competence – Allianz4Good and the ESG Office.
BrEakdown of co2 EmiSSionS1 as of 31 December 2014 in %
Our responsibilities as an investor are two-fold: Firstly, we invest our own assets, which include premiums collected from our insurance customers, and we systematically integrate ESG issues into our own investment processes. Secondly, in our third-party asset management business, we invest on behalf of our asset management customers. We aim to tailor products, solutions and distribution that best meet our clients’ needs and further strengthen the brand of our asset management subsidiaries, Allianz Global Investors ( AllianzGI) and PIMCO, and offer a growing number of Sustainable and Responsible Investment (SRI) products.
Overall, markets recorded continuing net inflows into equity and fixed income as money provided by central banks in Western countries was flooding the markets in search of safety or returns – in particular into global equity as well as taxable and tax-exempt bonds. Most active asset managers were able to capture a portion of the organic growth, but there was also a significant shift to passive products visible in the markets, especially in the United States. The flow development, as well as rising assets under management, drove revenues and profits higher.
1 Conglomerate solvency ratio as of 31 December 2014 was adjusted for the potential calls of hybrid capital (subordinated bonds) of € 0.4 bn in 2015. Excluding this adjustment, the solvency ratio would be 182 % (including off-balance sheet reserves) as of 31 December 2014. 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 solvency ratio as of 31 December 2014 would be 172 % (31 De2 Internal total revenue growth excludes the effects of foreign currency translation as well as acquisitions and disposals. Please refer to page 121 for a reconciliation of nominal total revenue growth to internal total revenue growth for each of our segments and the Allianz Group as a whole.
The following operations contributed positively to the development of our accident year loss ratio: Germany: 1.6 percentage points. This was largely because of a reduced burden from natural catastrophe events compared to the previous year – which was severely impacted by storm Andreas and the Frederic floods. The improvement was further supported by a lower attritional claims ratio and favorable price momentum, particularly in our retail motor and commercial non-motor business.
Operating income from financial assets and liabilities carried at fair value through income (net) grew by € 81 MN from € (75) MN to € 6 MN. This was largely due to an improved foreign exchange result net of hedging compared to 2013.
Expenses for premium refunds (net) increased by € 146 MN to € 307 MN. The change is driven by a higher policyholder participation, mainly from the higher realized gains attributable to our APR business.
2 A respective offsetting effect was recorded in our Corporate and Other business segment. For further information on the one-off effect from pension revaluation, please refer to note 6 to the consolidated financial statements.
6 On 12 July 2013, Allianz Turkey acquired Yapı Kredi Bank’s shareholding in the Turkish property-casualty insurance company Yapı Kredi Sigorta.
Technical margin 1,190 1,289 Impact of change in Dac 425 77 Operating profit 3,327 2,709
Impact of change in Dac Impact of change in DAC (deferred acquisition costs) includes effects of change in DAC, unearned revenue reserves (URR) and value of business acquired (VObA) and is the net impact of deferral and amortization of acquisition costs and front-end loadings on operating profit.
Investment margin (net of policyholder participation) 2,972 2,386 2,881 2,312 39 64 52 10
7 On 12 July 2013, the Allianz Group acquired Yapı Kredi Bank’s 93.94 % shareholding in the Turkish propertycasualty insurance company Yapı Kredi Sigorta, including its life and pension insurance subsidiary Yapı Kredi Emeklilik.
Net fee and commission income decreased by € 747 MN – or 10.5 % – to € 6,380 MN. This mainly reflects lower fee income due to decreased average third-party AuM at PIMCO and lower margins on our AuM. Our performance fees fell by € 235 MN to € 275 MN in 2014. This can be explained by the exceptionally high carried interest income of € 219 MN in the first half of 2013.
Our net loss more than halved from € 1,334 mn to € 657 mn. This was largely driven by a € 558 mn one-off benefit in our non-operating result from pension revaluation with our German subsidiaries1. Furthermore, in 2013, we recorded a € 96 mn goodwill impairment on a fully consolidated private equity investment.
2 For further information on our strategy, please refer to Strategy and Steering starting on page 70.
Operating investment income (net) was stable this year after a 5.6 % decline in 2013.
1 Conglomerate solvency ratio as of 31 December 2014 was adjusted for the potential calls of hybrid capital (subordinated bonds) of € 0.4 bn in 2015. Excluding this adjustment, the solvency ratio would be 182 % (including off-balance sheet reserves) as of 31 December 2014. 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 solvency ratios as of 31 December 2014 and 2013 would be 172 % and 173 %, respectively.
Operating income from financial assets and liabilities carried at fair value through income (net) improved by € 567 mn to a loss of € 1,301 mn. The previous year’s result was considerably impacted by losses from the net of foreign currency translation effects and financial derivatives, mainly within our German Life/Health business. De rivatives are used to protect against equity and foreign currency 1 Net of interest expenses (excluding interest expenses from external debt).
Loss and loss adjustment expenses paid in current year relating to previous years (14.7) 1.4 (13.3) Loss and loss adjustment expenses incurred in previous years (1.8) 0.4 (1.4) Foreign currency translation adjustments and other changes 2.5 (0.5) 2.0 Changes in reserves for loss and loss adjustment expenses in current year 16.7 (1.8) 14.9
2 For further information on the development of these third-party assets, please refer to Asset Management starting on page 99. Effective 1 January 2014, the Allianz Group 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.
Acquisition expenses and commissions (as per md&a) (4,833) (4,233) Administrative and other expenses (as per md&a) (1,577) (1,519) Capitalization of daC (as per md&a) 1,937 1,596 Amortization, unlocking and true-up of daC (as per md&a) (1,513) (1,519) Acquisitions and administrative expenses (5,985) (5,675)
Eligible capital 49.8 46.5 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. The solvency ratio excluding off-balance sheet reserves would be 173 % as of 31 December 2013 and additionally adjusted by € 0.4 bn for the potential calls of hybrid capital (subordinated bonds) in 2015, 172 % as of 31 December 2014.
Annual Report 2014 Allianz Group 125 affirmed the Allianz Group’s “Aa3” rating and revised the outlook from “negative” to “stable”, recognizing our capital strength and diverse business profile. Standard & Poor’s reconfirmed the "AA" rating.
aa– Not rated Not rated 1 Includes ratings for securities issued by Allianz Finance II b.V. and Allianz Finance Corporation. 2 Rating reflects Senior unsecured debt. 3 Issuer Credit rating.
Furthermore, as historical data is used where possible to calibrate the model, historical data cannot be used for validation. Instead, we validate the model and parameters through sensitivity analyses, independent internal peer reviews and, where appropriate, external reviews by independent consulting firms, focusing on methods for selecting parameters and control processes. To ensure proper validation we established an Independent Validation Unit (IVU) within Group Risk responsible for validating our internal model within a 4 2013 risk profile figures recalculated based on model changes in 2014 as described in Internal model updates in 2014 from page 129.
With respect to investments, top-down indicators such as strategic asset allocations are defined and closely monitored to ensure balanced investment portfolios. Furthermore, we have a limit system in place which is defined at Group level separately for the Life/Health and the Property-Casualty business segments as well as at operating entity level. The limits comprise economic limits, in particular financial VaR and credit VaR as derived from the internal model framework, complemented by stand-alone interest rate and equity sensitivity limits as well as by limits on foreign exchange exposures.
Inflation risk As an insurance company we are exposed to changing inflation rates, predominantly due to our non-life insurance obligations. In addition, internal pension obligations contribute to our exposure to inflation. Since inflation increases both claims and costs, higher inflation rates will lead to greater liabilities. Inflation assumptions are already taken into account in our product development and pricing and the risk of changing inflation rates is incorporated in our internal model. As of 31 December 2014, inflation risk amounted to € 4.2 Bn, showing a change of € 0.7 Bn, mainly due to lower discount rates resulting in higher market values of inflation-sensitive liabilities and internal pension liabilities.
Credit risk – credit insurance Our credit insurance portfolio is modeled by Euler Hermes based on a proprietary model component, which is a local adaptation of the central internal credit risk module and is reviewed by Group Risk. The result is integrated in the Group’s internal credit risk to capture the concentration and diversification effects. As of 31 December 2014, 4.5 % (2013: 4.8 %) of our total Group pre-diversified internal credit risk was allocated to Euler Hermes credit insurance exposures.
allianz gRoup: inteRnal Risk pRofile – allocated Business Risk By Business segment (total poRtfolio BefoRe tax and non-contRolling inteRests)
otheR Risks There are certain risks that cannot be fully quantified across the Group using our internal risk capital model. For these risks we also pursue a systematic approach with respect to identification, analysis, assessment, monitoring and steering. In general, the risk assessment is based on qualitative criteria or scenario analyses. The most important of these other risks are strategic, liquidity and reputational risk.
Risk management fRamewoRk As a provider of financial services, we consider risk management to be one of our core competencies. It is therefore an integral part of our business process. Our risk management framework covers, on a riskbased approach, all operations including IT, processes, products and departments/subsidiaries within the Group. The key elements of our risk management framework are: − Promotion of a strong risk management culture, supported by a robust risk governance structure.
Risk goveRnance stRuctuRe As a key element of our risk management framework, Allianz’s approach to risk governance enables integrated management of local and global risks and ensures that our risk profile remains consistent with our risk strategy and our capacity to bear risks.
accountIng and consolIdatIon processes The accounting and consolidation processes we use to produce consolidated financial statements are based on a central consolidation and reporting IT solution and local general ledger solutions. The latter are largely harmonized throughout the Group, using standardized processes, master data, posting logics and interfaces for data delivery to the Holding. Access rights to accounting systems are managed according to strict authorization procedures.
Consolidated statements of Cash flows – Continued consolidated statements of cash flows € mn cash flow from investing activities Proceeds from the sale, maturity or repayment of: Financial assets designated at fair value through income 1,335 1,347 Available-for-sale investments 124,855 120,507 Held-to-maturity investments 579 836 Investments in associates and joint ventures 709 397 Non-current assets and assets and liabilities of disposal groups classified as held for sale 146 24 Real estate held for investment 329 663 Loans and advances to banks and customers (purchased loans) 8,345 9,863 Property and equipment 119 200
sUpplementarY information on the consolidated statements of cash flows Income taxes paid (3,081) (3,672) Dividends received 1,555 1,355 Interest received 18,851 18,657 Interest paid (1,326) (1,308)
other LiaBiLities Other liabilities primarily consist of payables, provisions for pensions and similar obligations, employee-related provisions, deposits retained for reinsurance ceded, and financial liabilities for puttable equity instruments.
The evaluation of whether a financial debt security is impaired requires analysis of the underlying credit risk/ quality of the relevant issuer and involves significant management judgment. In particular, current publicly available information relating to the issuer and the particular security is considered relating to factors including, but not limited to, evidence of significant financial difficulty of the issuer and breach of contractual obligations of the security, such as a default or delinquency on interest or principal payments. The Allianz Group also considers other factors which could provide objective evidence of a loss event, including the probability of bankruptcy and the lack of an active market due to financial difficulty. The presence of either a decline in fair value below amortized cost or the downgrade of an issuer’s credit rating does not by itself represent objective evidence of a loss event, but may represent objective evidence of a loss event when considered with other available information.
For certain investment funds in which the Allianz Group holds a stake of above 20 %, management has assessed that the Allianz Group has no significant influence because it is not represented in the governing bodies of these investment funds.
restruCturiNG proVisioNs As of 31 December 2014, the Allianz Group reported a provision for restructuring programs of € 109 mn.3
IFRS 10, Consolidated Financial Statements, superseded the requirements of IAS 27, Consolidated and Separate Financial Statements and SIC-12, Consolidation – Special Purpose Entities. IFRS 10 establishes a single control concept as the basis for determining which entities are to be included in the consolidated financial statements because they are controlled by the reporting entity. The existence of control is based on the following three elements: − power over the investee, − exposure, or rights, to variable returns from the involvement with the investee, and − the ability to use power over the investee to affect the amount of the investor’s returns.
The effective date announced by the IASB is 1 January 2018, while early application is permitted. However, IFRS 9 has not yet been endorsed by the European Union. The Allianz Group is currently evaluating the impact of adopting IFRS 9 on its consolidated financial statements.
The new standard is generally effective for periods beginning on or after 1 January 2017; earlier application is permitted. The Allianz Group is currently evaluating the impact of IFRS 15 on its consolidated financial statements. Allianz Group will decide on the application date of IFRS 15 once it has been endorsed by the E.U.
Total identifiable assets and liabilities expected to be recognized as of 1 January 2015 amount to approximately € 0.3 Bn and € 0.2 Bn, respectively. At the time the consolidated financial statements were authorized for issue, the purchase accounting for the business combination was not entirely completed due to the pending receipt of the final valuations for investments, intangible assets, insurance liabilities and reinsurance assets, deferred taxes, and other liabilities.
Corporate and Other The reportable segment Holding & Treasury includes the management and support of the Allianz Group’s businesses through its strategy, risk, corporate finance, treasury, financial reporting, controlling, communication, legal, human resources, technology and other functions. The reportable segment Banking consists of the banking activities in Germany, France, Italy, the Netherlands and Bulgaria. The banks offer a wide range of products for corporate and retail clients, with a primary focus on the latter. The reportable segment Alternative Investments provides global alternative investment management services in the private equity, real estate, renewable energy and infrastructure sectors, mainly on behalf of the Allianz Group’s insurance operations. The reportable segment Alternative Investments also includes a fully consolidated private equity investment. The income and expenses of this investment are included in the non-operating result.
Non-operating investment result Non-operating income from financial assets and liabilities carried at fair value through income (net) (114) 25 (131) 27 – – (33) (46) (25) 17 (303) 23 Non-operating realized gains/losses (net) 463 520 183 88 4 2 184 346 (22) (4) 812 952 Non-operating impairments of investments (net) (168) (217) (21) (17) – – (7) (80) – – (197) (313)
Income (loss) before income taxes 1,080 1,009 1,575 1,773 115 401 (146) 161 2,123 1,909 31 199 108 106 90 6 4,976 5,563
Foreign currency translation adjustments 892 (390) Changes in shadow accounting (1,832) 2,204
Reclassifications into non-current assets classified as held for sale (81) (16) Foreign currency translation adjustments 11 (43)
Cost as of 1 January 12,534 12,573 Accumulated impairments as of 1 January (990) (894) Carrying amount as of 1 January 11,544 11,679
Additions in 2014 are related to goodwill arising from the acquisition of specific distribution activities of the Property-Casualty insurance business of UnipolSai Assicurazioni S.p.A., Bologna, the acquisition of Assurances Médicales S.A., Paris, as well as the acquisition of several windparks.
For all CGUs in the Life/Health business segment the value in use is based on an Appraisal Value method which is derived from the Embedded Value and new business value calculation.
As a starting point for the impairment test for the CGUs in the Life/Health business segment, the Market Consistent Embedded Value (mCEV) and a multiple of the Market Consistent Value of New Business is used. The mCEV is an industry-specific valuation method to assess the current value of the in-force portfolio and is in compliance with the general principles of the discounted earnings methods. The mCEV approach applied is based on the CFO Forum Principles1 and the Allianz Group’s Embedded Value guidelines. It is a riskneutral valuation that includes explicit allowance for non-financial risk as well as allowance for options and guarantees using marketconsistent stochastic simulations that are in line with market prices for similar financial instruments.
change in the reserves For loss and loss adjustment expenses in the property-casualty business segment € mn
€ 84 mn presented as reinsurance at Euler Hermes Re originating from credit business at Euler Hermes entities.
Changes in the consolidated subsidiaries of the Allianz Group – – – – 1,477 1,477
The resulting total benefits for insurance and investment contracts in the amount of € 1,130 Bn include contracts where the timing and amount of payments are considered fixed and determinable, and contracts which have no specified maturity dates and may result in a payment to the contract beneficiary depending on mortality and morbidity experience and the incidence of surrenders, lapses or maturities. Furthermore, the amounts are undiscounted and do not include any expected future premiums; therefore they exceed the reserves for insurance and investment contracts presented in the consolidated balance sheet.
Liabilities to banks and customers (241) (259) Deposits retained for reinsurance ceded (48) (49) Certificated liabilities (285) (272) Subordinated liabilities (585) (642)
Financial liabilities for unit-linked contracts 91,885 2,511 166 94,564 Derivative financial instruments and firm commitments included in other liabilities – 281 – 281 Financial liabilities for puttable equity instruments 1,754 24 15 1,793
Financial liabilities for unit-linked contracts 78,230 2,655 179 81,064 Derivative financial instruments and firm commitments included in other liabilities – 158 – 158 Financial liabilities for puttable equity instruments 2,595 18 – 2,612
Available-for-sale investments – Equity securities Equity securities within available-for-sale investments classified as level 3 mainly comprise private equity fund investments as well as alternative investments of the Allianz Group and are in most cases delivered as net asset values by the fund managers (€ 5.2 bn). The net asset values are calculated using material, non-public information about the respective private equity companies. The Allianz Group has only limited insight into the specific inputs used by the fund managers and hence a narrative sensitivity analysis is not applicable. The fund’s asset manager generally prices the underlying single portfolio companies in line with the International Private Equity and Venture Capital Valuation (IPEV) guidelines using discounted cash flow (income approach) or multiple methods (market approach). For certain investments, the invested capital is considered to be a reasonable proxy for the fair value. In these cases, sensitivity analyses are also not applicable.
Available-for-sale investments Corporate mortgage-backed securities (residential and commercial) 33 – (4) (4) 3 8 – 4 – 40 –
Financial liabilities for unit-linked contracts 179 5 1 (15) – (4) – – – 166 – Financial liabilities for puttable equity instruments – 3 – – 12 – – – – 15 – Total financial liabilities at fair value 4,606 1,385 1 (531) 1,071 (3) – 782 – 7,310 2,202
The Allianz Group engages in some business activities that involve entities that fit to the above-mentioned definition of structured entities. Primarily, the Allianz Group is involved with such entities due to its investment activities in the insurance business and due to its asset management activities. Furthermore, structured entities are used by the Allianz Group to source out certain risks to investors as part of its reinsurance business. Generally, the classification of entities as structured entities may require significant judgment.
Income derived from the management of investment funds includes asset management fees and performance based fees as far as own managed funds are concerned.
Due in 1 year or less 338 Due after 1 year and up to 5 years 1,116 Due after 5 years 1,156 Subtotal 2,610 Subleases (53) Total 2,558
Discount rate 2.2 3.5 Rate of compensation increase 2.1 2.2 Rate of pension increase 1.8 2.0 Rate of medical cost trend 2.6 3.7
The recognized expense is recorded based on the assumptions of the corresponding previous year.
Plan assets do not include any real estate used by the Allianz Group and include only € 5.2 mn of own transferable financial instruments.
The Class B equity units issued under the Class B Plan vest over 3 to 5 years and are subject to repurchase by AllianzGI L.P. upon the death, disability or termination of the participant prior to vesting. Starting 1 January 2005, AllianzGI L.P. has the right to repurchase, and the participants have the right to cause AllianzGI L.P. to repurchase, a portion of the vested Class B equity units each year. The call or put right is exercisable for the first time 6 months after the initial vesting of each grant. On the repurchase date, the repurchase price will be based on the determined value of the Class B equity units being repurchased. As the Class B equity units are puttable by the plan participants, the Class B Plan is accounted for as a cash-settled plan.
During the year ended 31 December 2007, Allianz acquired all of the remaining AGF shares from non-controlling interests in the context of the Tender Offer and Squeeze-out. Under the terms of an agreement (the “Liquidity Agreement”) between Allianz SE, AGF and the beneficiaries of the AGF share option plans 2003 – 2006 (AGF employees ), Allianz has the right to purchase all AGF shares issued through the exercise of these AGF share option plans after the put period (where the beneficiaries have the right to sell to Allianz). The price payable by Allianz per AGF share is a cash consideration equal to the Allianz 20-day average share price prior to the date the right to buy or
During the year ended 31 December 2014, the Allianz Group recognized total compensation expenses related to the modified share option plans of € (1) mn (2013: € 2 mn). As of 31 December 2014, the Allianz Group recorded a provision for these plans of € 3 mn (2013: € 8 mn).
Annual Report 2014 Allianz Group 253 51 – Earnings per share
Basic earnings per share Basic earnings per share are calculated by dividing net income attrib­ utable to shareholders by the weighted average number of common shares outstanding for the period.
Net income attributable to shareholders 6,221 5,996 Effect of potentially dilutive common shares (24) (76) Net income used to calculate diluted earnings per share 6,197 5,920
Weighted average number of common shares outstanding 453,841,370 453,297,832 Potentially dilutive common shares resulting from assumed conversion of: Share-based compensation plans 425,532 189,395 Weighted average number of common shares outstanding after assumed conversion 454,266,902 453,487,227
The sum of the total remuneration of the Allianz SE Board of Management for 2014, excluding the notional accruals of the MTB 2013 – 15 and excluding the pension service cost, amounts to € 30 Mn (2013: € 31 Mn).
PIMCO Cayman Global Credit Alpha Fund, George Town 99.9 4 PIMCO Covered Bond Source UCITS ETF, Dublin 75.0 4 PIMCO Euro Low Duration Investment Grade Corporate Fund, Dublin 100.0 3 PIMCO Europe Ltd., London 100.0 PIMCO German Government Bond Index Source UCITS ETF, Dublin 49.1 2,4 PIMCO Global Advisors (Ireland) Ltd., Dublin 100.0 PIMCO Global Advisors (Luxembourg) S.A., Luxembourg 100.0 PIMCO Global Advisors (Resources) LLC, Dover, DE 100.0 PIMCO Global Advisors LLC, Dover, DE 100.0 PIMCO Global Bond Strategy Fund, George Town 94.2 4 PIMCO Global Holdings LLC, Dover, DE 100.0 PIMCO GP I LLC, Wilmington, DE 100.0 PIMCO GP III LLC, Wilmington, DE 100.0 PIMCO GP IX LLC, Wilmington, DE 100.0 PIMCO GP V LLC, Wilmington, DE 100.0 PIMCO GP VII LLC, Wilmington, DE 100.0 PIMCO GP X LLC, Wilmington, DE 100.0 PIMCO GP XI LLC, Wilmington, DE 100.0 PIMCO GP XII LLC, Wilmington, DE 100.0 PIMCO GP XIII LLC, Wilmington, DE 100.0 PIMCO GP XIV LLC, Wilmington, DE 100.0 PIMCO International Dividend Fund, Wilmington, DE 100.0 4 PIMCO Investments LLC, Dover, DE 100.0 PIMCO Japan Ltd., Road Town 100.0 PIMCO Latin America Administradora de Carteiras Ltda., Rio de Janeiro 100.0 PIMCO Low Duration Euro Corporate Bond Source UCITS ETF, Dublin 51.2 4 PIMCO Low Duration Global Investment Grade Credit Fund, Dublin 57.3 4 PIMCO Low Duration US Corporate Bond Source UCITS ETF, Dublin 54.2 4 PIMCO Multi Strategy Alternative Fund, Boston, MA 99.7 4 PIMCO Real Path Blend 2020 Fund, Wilmington, DE 100.0 4 PIMCO Real Path Blend 2025 Fund, Wilmington, DE 100.0 4 PIMCO Real Path Blend 2030 Fund, Wilmington, DE 100.0 4 PIMCO Real Path Blend 2035 Fund, Wilmington, DE 100.0 4 PIMCO Real Path Blend 2040 Fund, Wilmington, DE 100.0 4 PIMCO Real Path Blend 2045 Fund, Wilmington, DE 100.0 4 PIMCO Real Path Blend 2050 Fund, Wilmington, DE 100.0 4 PIMCO Real Path Blend 2055 Fund, Wilmington, DE 100.0 4 PIMCO Real Path Blend Income Fund, Wilmington, DE 100.0 4 PIMCO Real Retirement 2055 Fund, Boston, MA 100.0 4 PIMCO REIT Management LLC, Wilmington, DE 100.0 PIMCO Select UK Retirement Strategy Fund, Dublin 94.9 4 PIMCO U.S. Dividend Fund, Wilmington, DE 99.9 4 POD Allianz Bulgaria AD, Sofia 65.9 Primacy Holdings Pty Ltd., Melbourne 100.0 Primacy Underwriting Management Ltd., Wellington 100.0 Primacy Underwriting Management Pty Ltd., Melbourne 100.0 Prosperaz Fundo de Investimento Renda Fixa Crédito Privado, São Paulo 100.0 3 Protexia France S.A., Paris 100.0 PT Asuransi Allianz Life Indonesia p.l.c., Jakarta 99.8 PT Asuransi Allianz Utama Indonesia Ltd., Jakarta 97.8 PTE Allianz Polska S.A., Warsaw 100.0 Q 207 GP S.à r.l., Luxembourg 100.0 Q207 S.C.S., Luxembourg 94.0 Quality 1 AG, Bubikon 100.0 Queenspoint S.L., Madrid 100.0 Questar Agency Inc., Minneapolis, MN 100.0 Questar Asset Management Inc., Ann Arbor, MI 100.0 Questar Capital Corporation, Minneapolis, MN 100.0 Quintet Properties Ltd., Dublin 100.0 RAS Antares, Milan 100.0 3 RB Fiduciaria S.p.A., Milan 100.0 RCM Asia Pacific Ltd., Hong Kong 100.0 Real Faubourg Haussmann SAS, Paris 100.0 Real FR Haussmann SAS, Paris 100.0
Associates Adriatic Motorways d.d., Zagreb 33.3 Allianz EFU Health Insurance Ltd., Karachi 49.0 Allianz Euro Emprunts d'Etat, Paris 32.4 4 Allianz Euro Oblig Court Terme ISR, Paris 32.4 4 Allianz Fóndika S.A. de C.V., Mexico City 26.8 Allianz Invest Cash, Vienna 29.0 4 Allianz Invest Eurorent Liquid, Vienna 29.4 4 Allianz Invest Osteuropa, Vienna 29.9 4 Allianz Invest Vorsorgefonds, Vienna 29.0 4 Allianz Saudi Fransi Cooperative Insurance Company, Riyadh 32.5 Allianz Securicash SRI, Paris 23.4 4 Archstone Multifamily Partners AC JV LP, Engelwood, CO 40.0 Archstone Multifamily Partners AC LP, Wilmington, DE 28.6 Areim Fastigheter 2 AB, Stockholm 23.3 Assurcard N.V., Haasrode 20.0 Autoelektro tehnicki pregledi d.o.o., Vojni´c 49.0 Bajaj Allianz General Insurance Company Ltd., Pune 26.0 Bajaj Allianz Life Insurance Company Ltd., Pune 26.0 Berkshire Hathaway Services India Private Limited, New Delhi 20.0 Berkshire India Private Limited, New Delhi 20.0 Broker on-line de productores de seguros S.A., Buenos Aires 30.0 Brunei National Insurance Company Berhad Ltd., Bandar Seri Begawan 25.0 Capimmovalor SCPI, Paris 33.6 Chicago Parking Meters LLC, Wilmington, DE 49.9 CJSC "MedCentreStrakh", Moscow 36.4 CPIC Allianz Health Insurance Co. Ltd., Shanghai 22.9
Other participations between 5 and 20 % of voting rights Al Nisr Al Arabi, Amman 18.0 Banco BPI S.A., Porto 8.8 Sri Ayudhya Capital Public Company Limited, Bangkok 16.8 Zagrebacka banka d.d., Zagreb 11.7 1 Percentage includes equity participations held by dependent entities in full, even if the Allianz Group's share in the dependent entity is below 100 %.
Mandates of the Members of the Supervisory Board DR. HELMUT PERLET Chairman Former Member of the Board of Management of Allianz SE Membership in other statutory supervisory boards and SE administrative boards in Germany Commerzbank AG GEA Group AG
CHRiSTinE BoSSE Former Group Chief Executive Officer of the Executive Management of Tryg Membership in comparable1 supervisory bodies Aker ASA Flügger A/S (Chairwoman) until 18 September 2014 TDC A/S
SERGio BaLBinoT since 1 January 2015 Insurance Western & Southern Europe Membership in comparable1 supervisory bodies Membership in Group bodies Allianz France S.A.
since 28 July 2014 Membership in Group bodies Allianz Life Insurance Company of North America (Chairman) Allianz of America, Inc. (Chairman) AZOA Services Corp. (Chairman) Fireman’s Fund Insurance Company (Chairman)
combined rAtio Represents the total of acquisition and administrative expenses (net), excluding one­off effect from pension revaluation, and claims and insurance benefits incurred (net) divided by premiums earned (net).
repurchAse And reverse repurchAse Agreements A repurchase (repo) transaction involves the sale of securities by the Group to a counterparty, subject to the simultaneous agreement to repurchase these securities at a certain later date, at an agreed price. The securities concerned are retained in the Group’s balance sheet for the entire lifetime of the transaction, and are valued in accordance with the accounting principles for financial assets carried at fair value through income or investment securities, respectively. The proceeds of the sale are reported in liabilities to banks or to customers, as appro­ priate. A reverse repo transaction involves the purchase of securities with the simultaneous obligation to sell these securities at a future date, at an agreed price. Such transactions are reported in loans and advances to banks, or loans and advances to customers, respectively. Interest income from reverse repos and interest expenses from repos are accrued evenly over the lifetime of the trans­ actions and reported under interest and similar income or interest expenses.
Liquidity 108, 116ff. Loss adjustment expenses 113, 164, 167, 204ff. Low interest rate environment 67f., 71, 79f., 95, 105ff.,