Asia and New Europe: Strong growth drivers for Allianz

In Asia Pacific*, premiums reached 4.1 billion euros, exceeding the landmark of four billion euros for the first time in a six month period "It was another half-year of strong growth, and another half-year of clearly exceeding our targets," Zedelius summarized.

Two general characteristics are shaping Allianz’s business in Asia Pacific these days. On the one hand growth in the strategic investment markets India and China remains astonishing. In China, for example, premiums in life insurance already exceeded the full year result of 2006. On the other hand, Allianz has attained very strong positions in other important markets in the region such as Australia, Taiwan, South Korea and South East Asia. "Our business in the region is well balanced. We continue to grow on a firm and solid base in traditional Asian growth markets, while strongly expanding in the two boom economies China and India," Zedelius commented.

The biggest life operation in the region is still Korea, where premiums amounted to 931 million euros. Profitability more than doubled, with operating profit reaching 78 million euros. In Taiwan, the minority buy-out of our life insurer was successfully completed and the company has been re-branded to Allianz Taiwan Life. Gross premiums written reached almost 900 million euros, 20 percent above the level a year ago. This was due to the success of unit-linked products.

Allianz China Life was able to exceed the full year premium of 2006 and achieved 130 million euros premium in the first half of 2007, an increase of 173 percent. In July, Jiangsu was added to the list of Chinese provinces where Allianz is selling life insurance. In India, growth of Bajaj Allianz reached 60 percent once again, and gross written premiums amounted to 640 million euros.

Performance in property and casualty insurance is mainly driven by Australia, contributing roughly two-thirds to the region’s total premiums of 1.1 billion euros. India grew particularly strong (195 million euros in the first half, up 38 percent), due to a successful commercial motor vehicle tariff. Also, investments in direct channel marketing and bancassurance started to have a positive effect on sales. In Malaysia, Allianz has completed the acquisition of Commerce Assurance Berhad, placing Allianz General Insurance as a strong number two in the market. Allianz has a strong long-term commitment to the region, as can also be seen in Laos, where the joint venture with the local government was renewed for another 30 years.

In the first half-year New Europe** reached more than two billion euros in premiums. On a year-on-year basis, premiums increased by 24 percent to 2.2 billion euros.

All countries in New Europe contributed to this positive development. Main driver for this increase in premiums was Russia, effected by the acquisition of "Progress-Garant" in May. Also, the Russian Insurer "ROSNO" was consolidated following the acquisition of ROSNO by Allianz in February.

The life and health business recorded a significant increase in statutory premiums by 33 percent to 607 million euros. Operating profit rose by 21 percent to 34 million euros.

Especially Poland and Slovakia contributed to this positive result. Both countries recorded highest levels of growth. In Poland premiums increased by 36 percent to 314 million euros due to the successful sales of Allianz products by the Polish PEKAO bank in particular, as well as increased sales of a single premium unit-linked product. In the same period Slovakia saw an increase by 43 percent to 126 million euros. This increase resulted from the sale of a new investment product, as well as the good sales performance of the agent network.

Gross premiums written in property and casualty business increased in the first six months of 2007 by 21 percent to 1.6 billion euros. In the same period, operating profit amounted to 146 million euros.

Besides Russia, Poland and Romania contributed to this positive development due to increased sales in the motor business. In addition, the sales force in Poland was increased as well. Poland posted a growth rate of 27 percent which boosted premiums to 181 million euros year-to-date. In the same period, Romania registered an increase in premiums by 25 percent to 173 million euros.

"We have once again outreached our targets for New Europe and continued our strategy of profitable growth. This remarkable growth reflects the ambitious and hard work of Allianz employees in this important region," commented Zedelius on the development for New Europe.

Allianz SE board member Werner Zedelius is optimistic that Allianz will reach its targets for 2007: "We’re fully on track. I’m convinced that the growth markets will contribute double-digit growth and a significant net income to the overall performance of the Allianz Group."

*Allianz is active in the following markets: Australia, Brunei, China, Hong Kong, India, Indonesia, Japan, Laos, Malaysia, New Zealand, Pakistan, South Korea, Taiwan, Thailand, Singapore. Figures for Asia Pacific include non-consolidated OEs in China (P&C), Thailand, and India.

**Allianz is active in: Bulgaria, Croatia, Czech Republic, Hungary, Poland, Russia, Romania, Slovakia, Ukraine. Effective February 21, 2007, "ROSNO" was consolidated. Effective May 21, 2007, Allianz consolidated "Progress-Garant" for the first time.


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