Growth markets are essential for Allianz's global strategy of profitable growth. This was stressed by Werner Zedelius, member of board of Allianz SE responsible for growth markets, when reporting results of Asia Pacific and Middle East/North Africa (MENA). Allianz recorded premiums of 4.0 billion euros and operating profits of 203 million euros in the first half of 2009 in these two regions.
First half-year results 2009
"I am pleased that we are weathering the economic crisis quite well due to our strong financial position and risk management on the one hand, and due to our focus on clients and distributors on the other hand," commented Zedelius. "With these features, growth markets will further increase its role as a key source of profitable growth for Allianz as a group."
Werner Zedelius: "I am pleased that we are weathering the economic crisis quite well due to our strong financial position"
Continuation of sustainable profitability and growth in Asia Pacific
Allianz is on course in Asia Pacific for the first half of 2009. The Property and Casualty (P&C) business achieved premiums of 1.0 billion euros in 2009, up 4.2 percent from last year. Life insurance was affected by the economic crisis with premiums coming in at 1.8 billion euros.
P&C strong in growth, operating profits, combined ratio
In P&C, the biggest market Australia contributed 0.7 billion euros to total premiums in the first half of 2009. Combined ratio for Australia improved to 96.8 percent, from 97.0 percent a year ago. Asia Pacific (excluding Australia) contributed 289 million euros, translating to 18.4 percent increase. Operations in Malaysia, Indonesia and China saw double digit growth in their premiums. The main growth driver for Malaysia is the successful relationship with its younger distribution channels, in particular bancassurance and franchise dealers. For Indonesia, growth is mainly generated by the engineering business, which grew more than 80 percent. The combined ratio for Asia Pacific (excluding Australia) improved to 98.6 percent from 99.7 percent first half 2008. Operating profit of the P&C business increased to 12 million euros.
Life insurance saw markets like Taiwan, Malaysia and Thailand performing well. After a challenging 2008, Taiwan which contributed 40 percent to the region's GWP, grew by five percent to 719 million euros. Malaysia's premiums rose by more than 25 percent, mainly due to the expansion of agency force and higher productivity. Operating profit for the Asia Pacific region increased to 54 million euros in 2009, largely because of the rising product profitably across all operations.
"I am happy to see the P&C business continuing to grow profitably," Bruce Bowers, CEO of Allianz Asia Pacific commented. "In life insurance, I am satisfied with our performance given that the first quarter of the year has seen the worst of the economic crisis."
10 years presence in China, Korea, Taiwan
Allianz puts particular importance on expanding and strengthening its distribution channels. This is demonstrated in China, Indonesia, Malaysia, Taiwan and Thailand, where the aggregate life agency manpower reached almost 60,000 people by the end of the first half of 2009, an increase of 32 percent within a year.
"2009 is a significant year for us. We started our business in three countries in Asia – China, Korea and Taiwan 10 years ago. Since then, we have strengthened our position continuously and proven our long-term commitment in Asia," said Bowers. "One of our priorities in Asia is to deliver the best service possible. We need to make our processes, products and services even more customer focused, while keeping expenses tightly under control. To achieve this, we consistently optimize our operations in Asia."
Bruce Bowers: "I am happy to see the P&C business continuing to grow profitably"
Middle East and North Africa (MENA) – focus on underwriting and expense management
The performance of Allianz in the MENA region has been in line with the aim of having a major presence and focus in these markets. Allianz MENA registered a premium income of 1.2 billion euros in the first half of the year. This is 14 percent below the same period last year mainly as a result of the drop in the Indian life insurance market. Premiums reached 947 million euros in life and 230 million euros in P&C. MENA has successfully moved ahead with the expansion in Middle East countries like Sri Lanka and Lebanon, where growth exceeded 60 percent and 30 percent, respectively. Operating profit has increased by almost 25 percent to 37 million euros in the first half of 2009 as a result of efficiency improvements in the Indian operations. P&C in India improved the combined ratio to 98.3 percent.
Kamesh Goyal, Regional CEO, Allianz MENA region, commented: "Our performance in MENA has to be seen against the backdrop of a tough market environment. Our focus will remain on managing growth with profitability by prudent expense management and underwriting discipline. We feel that going forward, we will use our best practices across the region and global strength to stay ahead."
Kamesh Goyal: "Our performance in MENA has to be seen against the backdrop of a tough market environment"
Financial strength – major competitive edge of Allianz
Pointing to Allianz' financial strength and unrivalled solvency, Werner Zedelius concluded: "Even facing the storm, we still keep up well and remain a reliable partner. Indicators like solvency, operating profit, company ratings and market capitalization, show Allianz Group in a superior position among international insurers. Going forward, we will strengthen product offerings and distribution channels and enhance our operations in Asia Pacific, to serve our customers in the best way possible."
1 Figures comprise all Allianz insurance companies in Asia Pacific and MENA, including those not consolidated under IFRS (India). Growth figures are internal growth, i.e. adjusted for F/X effects and consolidation effects.
2 Asia Pacific consists of Allianz entities in Australia, China, Hong Kong, Indonesia, Japan, Laos, Malaysia, Singapore (incl. Brunei), South Korea, Taiwan, and Thailand.
3 Middle East and North Africa was established as the third growth region of Allianz in 2007, besides Asia Pacific and New Europe. It consists of entities in Bahrain, Egypt, India, Jordan, Lebanon, Pakistan, Saudi Arabia, and Sri Lanka.
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