Diekmann: We initiated many changes last year - converting into a European company, merging with RAS and reorganizing our German business. At the same time, we succeeded in accelerating our profitable growth and reaching all of our targeted goals.

Diekmann: The financial results speak for themselves. We are implementing our big agenda without neglecting our actual business. We can promise that too for 2006. The "+One"-initiatives – Sustainability and Customer Focus – are already helping us to speed up profitable growth.

And our new German and European structure will soon enable us to work more efficiently and productively. Indeed, this also depends on our working together professionally as regards the reorganization.

Diekmann: It's precisely our position of strength which calls for us to make our structures fit for the future. The creation of Allianz Deutschland AG isn't a rationalization project; it's rather a growth initiative. Our German insurance business lost some of its winning margin over the last few years. We need to counteract that through more customer orientation and more efficient structures. We have already tested the general model in Austria - an example of knowledge transfer within the Group.

Perlet: We've succeeded in laying a very solid foundation in all lines of business, from which we can further increase our profitable growth. We have gained in all segments.
For the first time, we recorded revenues of more than 100 billion euros. The portfolio quality improved across all sectors. We have provided a basis for further profitable growth.

Perlet: In 2005, insurers had to pay claims of 75 billion euros worldwide as a result of natural catastrophes, making 2005 the most costly year in terms of natural catastrophes. We have however succeeded once again in improving our combined ratio – the ratio of incurred losses and expenses to net premium income. We reached 92.3 percent, which is in fact better than the target value of less than 95 percent for 2005.

Put briefly, diversification and risk management pay off. We've been doing our homework since September 11, 2001. We have won more business for all of our segments, but are taking on fewer risks.

Diekmann: The fact that our Allianz sales agents in Germany were able to win 360,000 new customers last year for our banking business shows that the concept of being an integrated financial service provider works. This year, we will try again to reach the target of at least 300,000 new customers.

Our agents have also attracted a record-breaking more than one billion euros in net inflows for investment funds. And, the sale of insurance and retirement provision products via the bank is also going well: Dresdner Bank once again increased its share of new business in P&C and Life insurance in 2005.

Diekmann: We closely integrate our insurance, asset management and banking businesses in several markets. We've made particular progress in Italy and France with RasBank and Banque AGF. Our experience with the German model helps up with development and expansion in other countries.

Perlet: The most important thing for me is that operating results increase in all of the Bank’s strategic business areas. The Bank has achieved a lot and it's important now to build on that. We estimate that Dresdner Bank’s operating profits will rise by two thirds to 1.3 billion euros this year.

Diekmann: What's new is the fact that we methodically measure customer satisfaction. The important indicator is the so-called "Net Promoter Score", which measures how many customers recommend us to others. You can tell we take it seriously by the fact that board remuneration will also be calculated according to how successfully these measures are introduced.

We're evaluating the results of our first pilot test fields to figure out how we can differentiate our customer service more sharply from that of our competitors.

Diekmann: The principle of the Sustainability program is simple - we want to make the best of the Group available to as many customers as possible. That may be individual products or services. That isn't quite as easy as it sounds with a group of our size but it still manages to work very well.

One example: Our US company Allianz Life successfully sells equity-indexed annuities, whose value is based on stock market indices. We offer a similar type of insurance in Asia and introduced it in Germany this year. Now we're considering a launch in various other European countries.

This gives us a decisive lead in many markets when we introduce new products. Few competitors can leverage on international experience.

Irrespective of improved business, both initiatives make the company more international and flexible. The teamwork across nations, businesses and hierarchies improves our corporate culture: people can work together on making improvements as things become more transparent.

Perlet: In all sectors, but especially in the retirement provisions market which is a massive growth market, both in Europe and in many other countries. Our Life insurance and Asset Management businesses will benefit from the fact that more and more people have to provide for their old age themselves. Strong performance and innovative products contribute to our getting a decent slice of the cake which is getting bigger. Our Assets under Management for third parties increased by 27 percent to 743 billion euros in 2005, and net inflows reached a record level of 64 billion euros.

Diekmann: India, China and Russia are currently the most dynamic markets in the world. We recognized their value early on and already have a strong market position there today. In India, for example, our joint venture companies Bajaj Allianz Life and Bajaj Allianz General are the largest private insurers in their respective business areas. We want to exceed the turnover threshold of ten billion euros in the growth markets of Asia and central & eastern Europe by 2008 at the latest.


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