Consolidated financial statements for nine months ended Sep 30, 2005 and 2004
Table of Contents


 

SECURITIES AND EXCHANGE COMMISSION

Washington, D.C. 20549

 


 

Form 6-K

 

Report of Foreign Private Issuer

Pursuant to Rules 13a-16 or 15d-16 of

the Securities Exchange Act of 1934

 

December 12, 2005

 

Commission file Number: 1-15154

 

ALLIANZ AKTIENGESELLSCHAFT

 

Königinstrasse 28

80802 Munich

Germany

(Address of principal executive offices)

 


 

Indicate by check mark whether the registrant files or will file annual reports under cover Form 20-F or Form 40-F.

 

Form 20-F  x                    Form 40-F  ¨

 

Indicate by check mark whether the registrant by furnishing the information contained in this Form is also thereby furnishing the information to the Commission pursuant to Rule 12g3-2(b) under the Securities Exchange Act of 1934.

 

Yes  ¨                    No  x

 



Table of Contents

This Report on Form 6-K consists of interim financial statements of Allianz Aktiengesellschaft (“Allianz AG”) for the period ended September 30, 2005 with comparative figures for September 30, 2004, including a reconciliation to U.S. GAAP, for purposes of incorporation by reference into certain registration statements filed by Allianz AG with the U.S. Securities and Exchange Commission.

 

SIGNATURES

 

Pursuant to the requirements of the Securities Exchange Act of 1934, the registrant has duly caused this report to be signed on its behalf by the undersigned, thereunto duly authorized.

 

Date: December 12, 2005

 

ALLIANZ AKTIENGESELLSCHAFT
By:   /s/ Dr. Joerg Weber         
   

Name: Dr. Joerg Weber

Title: Head of Group Management Reporting

 

By:   /s/ Jonathan Wismer         
   

Name: Jonathan A. Wismer

Title: Group Management Reporting


Table of Contents

EXHIBIT INDEX

 

Exhibit

  

Description of Exhibit


99.1    Allianz Group unaudited consolidated financial statements as of and for the nine months ended September 30, 2005 and 2004, including a reconciliation to U.S. GAAP.


Table of Contents

Exhibit 99.1

ALLIANZ GROUP

 

UNAUDITED CONSOLIDATED FINANCIAL STATEMENTS

 

as of and for the nine months ended September 30, 2005 and 2004

 

INDEX

 

Consolidated Balance Sheets    F-2
Consolidated Income Statements    F-3
Consolidated Statements of Changes in Shareholders’ Equity    F-4
Consolidated Statements of Cash Flows    F-5
Notes to the Consolidated Financial Statements     
1    Basis of presentation    F-6
2    Recently adopted accounting pronouncements    F-6
3    Segment reporting    F-11
Supplementary Information to the Consolidated Balance Sheets     
4    Intangible assets    F-23
5    Investments    F-23
6    Loans and advances to banks    F-24
7    Loans and advances to customers    F-24
8    Financial assets carried at fair value through income    F-24
9    Amounts ceded to reinsurers from reserves for insurance and investment contracts    F-24
10    Shareholders’ equity    F-25
11    Participation certificates and subordinated liabilities    F-25
12    Reserves for insurance and investment contracts    F-26
13    Liabilities to banks    F-27
14    Liabilities to customers    F-27
15    Certificated liabilities    F-27
16    Financial liabilities carried at fair value through income    F-28
17    Other accrued liabilities    F-28
18    Other liabilities    F-28
Supplementary Information to the Consolidated Income Statements     
19    Premiums earned (net)    F-29
20    Interest and similar income    F-30
21    Income from investments in associated enterprises and joint ventures (net)    F-32
22    Other income from investments    F-32
23    Income from financial assets and liabilities carried at fair value through income (net)    F-32
24    Fee and commission income, and income from service activities    F-33
25    Other income    F-34
26    Insurance and investment contract benefits (net)    F-35
27    Interest and similar expenses    F-39
28    Other expenses from investments    F-39
29    Loan loss provisions    F-39
30    Acquisition costs and administrative expenses (net)    F-40
31    Other expenses    F-42
32    Taxes    F-42
Other Information     
33    Other information    F-43
34    Subsequent events    F-44
35    Summary of significant differences between the accounting principles used in the preparation of the consolidated financial statements and accounting principles generally accepted in the United States of America    F-45

 

F-1


Table of Contents

Allianz Group

Consolidated Balance Sheets

As of September 30, 2005 and as of December 31, 2004

 

         

September 30,

2005


  

December 31,

2004


     Note    € mn    € mn
          (unaudited)     

ASSETS

              

Intangible assets

   4    15,465    15,147

Investments in associated enterprises and joint ventures

        3,470    5,757

Investments

   5    276,177    248,327

Loans and advances to banks

   6    150,048    181,543

Loans and advances to customers

   7    193,179    195,680

Financial assets carried at fair value through income

   8    235,097    240,574

Cash and cash equivalents

        24,093    15,628

Amounts ceded to reinsurers from reserves for insurance and investment contracts

   9    23,533    22,310

Deferred tax assets

        15,242    14,139

Other assets

        52,894    51,213
         
  

Total assets

        989,198    990,318
         
  
         

September 30,

2005


  

December 31,

2004


     Note    € mn    € mn
          (unaudited)     

SHAREHOLDERS’ EQUITY AND LIABILITIES

              

Shareholders’ equity

   10    48,588    37,691

Participation certificates and subordinated liabilities

   11    14,547    13,230

Reserves for insurance and investment contracts

   12    356,489    326,380

Liabilities to banks

   13    147,998    191,347

Liabilities to customers

   14    159,907    157,137

Certificated liabilities

   15    58,645    57,752

Financial liabilities carried at fair value through income

   16    141,085    145,137

Other accrued liabilities

   17    13,797    13,984

Other liabilities

   18    29,154    31,271

Deferred tax liabilities

        15,544    14,350

Deferred income

        3,444    2,039
         
  

Total shareholders’ equity and liabilities

        989,198    990,318
         
  

 

F-2


Table of Contents

Allianz Group

Consolidated Income Statements (unaudited)

for the three months and nine months ended September 30, 2005 and 2004

 

         

Three months

ended

September 30,


   

Nine months

ended

September 30,


 
        2005

    2004

    2005

    2004

 
     Note    € mn     € mn     € mn     € mn  

Premiums earned (net)

   19    13,994     13,830     42,292     41,829  

Interest and similar income

   20    5,282     5,181     16,597     15,773  

Income from investments in associated enterprises and joint ventures (net)

   21    80     68     962     707  

Other income from investments

   22    1,008     783     3,487     4,137  

Income from financial assets and liabilities carried at fair value through income (net)

   23    617     346     1,099     1,305  

Fee and commission income, and income from service activities

   24    2,074     1,616     5,989     4,962  

Other income

   25    408     678     1,679     1,791  
         

 

 

 

Total income

        23,463     22,502     72,105     70,504  
         

 

 

 

Insurance and investment contract benefits (net)

   26    (13,375 )   (12,318 )   (40,194 )   (38,860 )

Interest and similar expenses

   27    (1,387 )   (1,460 )   (4,700 )   (4,234 )

Other expenses from investments

   28    (310 )   (651 )   (925 )   (2,102 )

Loan loss provisions

   29    132     (51 )   88     (273 )

Acquisition costs and administrative expenses (net)

   30    (6,141 )   (5,806 )   (17,598 )   (17,286 )

Amortization of goodwill

        —       (297 )   —       (885 )

Other expenses

   31    (724 )   (730 )   (2,707 )   (2,770 )
         

 

 

 

Total expenses

        (21,805 )   (21,313 )   (66,036 )   (66,410 )
         

 

 

 

Earnings from ordinary activities before taxes

        1,658     1,189     6,069     4,094  

Taxes

   32    (530 )   (497 )   (1,541 )   (1,240 )

Minority interests in earnings

        (334 )   (224 )   (1,020 )   (884 )
         

 

 

 

Net income

        794     468     3,508     1,970  
         

 

 

 

         

   

   

   

 

Basic earnings per share

   33    2.03     1.28     9.11     5.37  

Diluted earnings per share

   33    2.02     1.27     9.06     5.35  

 

F-3


Table of Contents

Allianz Group

Consolidated Statements of Changes in Shareholders’ Equity (unaudited)

for the nine months ended September 30, 2005 and 2004

 

    Paid–in
capital


  Revenue
reserves


    Foreign
currency
translation
adjustments


   

Unrealized
gains and
losses

(net)


    Shareholders’
equity before
minority
interests


   

Minority
interests in
shareholders’

equity


    Shareholders’
equity


 
    € mn   € mn     € mn     € mn     € mn     € mn     € mn  

Balance as of December 31, 2003, as previously reported

  19,347   6,914     (1,916 )   4,247     28,592     8,367     36,959  

Effect of implementation of new accounting standards (Note 2)

  —     (2,821 )   23     2,199     (599 )   (1,101 )   (1,700 )
   
 

 

 

 

 

 

Balance as of December 31, 2003, as adjusted

  19,347   4,093     (1,893 )   6,446     27,993     7,266     35,259  

Foreign currency translation adjustments

  —     —       99     17     116     15     131  

Changes in the group of consolidated companies

  —     (22 )   14     5     (3 )   —       (3 )

Treasury shares

  —     43     —       —       43     —       43  

Unrealized gains and losses (net)

  —     —       —       (704 )   (704 )   39     (665 )

Net income

  —     1,970     —       —       1,970     884     2,854  

Dividends paid

  —     (551 )   —       —       (551 )   (432 )   (983 )

Miscellaneous

  —     104     —       —       104     (433 )   (329 )
   
 

 

 

 

 

 

Balance as of September 30, 2004

  19,347   5,637     (1,780 )   5,764     28,968     7,339     36,307  
   
 

 

 

 

 

 

Balance as of December 31, 2004, as previously reported

  19,433   8,478     (2,680 )   5,597     30,828     9,531     40,359  

Effect of implementation of new accounting standards (Note 2)

  —     (2,585 )   46     1,706     (833 )   (1,835 )   (2,668 )
   
 

 

 

 

 

 

Balance as of December 31, 2004, as adjusted

  19,433   5,893     (2,634 )   7,303     29,995     7,696     37,691  

Foreign currency translation adjustments

  —     —       1,428     44     1,472     34     1,506  

Changes in the group of consolidated companies

  —     (195 )   2     (13 )   (206 )   106     (100 )

Capital paid in

  2,064   —       —       —       2,064     —       2,064  

Treasury shares

  —     1,640     —       —       1,640     —       1,640  

Unrealized gains and losses (net)

  —     —       —       2,191     2,191     466     2,657  

Net income

  —     3,508     —       —       3,508     1,020     4,528  

Dividends paid

  —     (674 )   —       —       (674 )   (594 )   (1,268 )

Miscellaneous

  —     (172 )   —       —       (172 )   42     (130 )
   
 

 

 

 

 

 

Balance as of September 30, 2005

  21,497   10,000     (1,204 )   9,525     39,818     8,770     48,588  
   
 

 

 

 

 

 

 

F-4


Table of Contents

Allianz Group

Consolidated Statements of Cash Flows (unaudited)

for the nine months ended September 30, 2005 and 2004

 

Nine months ended September 30,


   2005

    2004

 
     € mn     € mn  

Operating activities

            

Net income

   3,508     1,970  

Change in unearned premiums

   1,712     1,469  

Change in aggregate policy reserves (without aggregate policy reserves for life insurance products in accordance with SFAS 97)

   12,283     10,912  

Change in reserve for loss and loss adjustment expenses

   2,759     2,091  

Change in other insurance reserves (without change in the reserve for latent premium refunds from unrealized investment gains and losses)

   2,745     1,714  

Change in deferred acquisition costs

   (1,716 )   (544 )

Change in funds held by others under reinsurance business assumed

   (10 )   457  

Change in funds held under reinsurance business ceded

   (1,240 )   477  

Change in accounts receivable/payable on reinsurance business

   (84 )   (49 )

Change in trading securities (including trading liabilities)

   8,513     (22,059 )

Change in loans and advances to banks and customers

   34,657     (38,888 )

Change in liabilities to banks and customers

   (40,857 )   47,255  

Change in certificated liabilities

   797     2,397  

Change in other receivables and liabilities

   (1,388 )   5,392  

Change in deferred tax assets/liabilities (without change in deferred tax assets/liabilities from unrealized investment gains and losses)

   (52 )   164  

Non-cash investment income/expenses

   (4,470 )   (3,024 )

Amortization of goodwill

   —       885  

Other

   1,518     (1,958 )
    

 

Net cash flow provided by operating activities

   18,675     8,661  
    

 

Investing activities

            

Change in securities available-for-sale

   (19,716 )   (9,648 )

Change in investments held-to-maturity

   200     (607 )

Change in real estate

   (53 )   (1,457 )

Change in other investments

   3,124     861  

Change in cash and cash equivalents from the acquisition of consolidated affiliated companies

   —       (1,293 )

Other

   (284 )   (1,528 )
    

 

Net cash flow used in investing activities

   (16,729 )   (13,672 )
    

 

Financing activities

            

Change in participation certificates and subordinated liabilities

   1,311     1,232  

Change in investments held on account and at risk of life insurance policyholders

   (8,916 )   (6,177 )

Change in aggregate policy reserves for life insurance products according to SFAS 97

   10,404     4,365  

Cash inflow from capital increases

   2,064     —    

Dividend payouts

   (1,268 )   (983 )

Other from shareholders’ capital and minority interests (without change in revenue reserve from unrealized investment gains and losses)

   2,862     1,830  
    

 

Net cash flow provided by financing activities

   6,457     267  
    

 

Effect of exchange rate changes on cash and cash equivalents

   62     14  
    

 

Change in cash and cash equivalents

   8,465     (4,730 )

Cash and cash equivalents at beginning of period

   15,628     25,528  
    

 

Cash and cash equivalents at end of period

   24,093     20,798  
    

 

 

The data for the Allianz Group’s consolidated statements of cash flows was prepared in accordance with International Financial Reporting Standards (IFRS).

 

Outflows for taxes on income amounted to € 969 mn (2004: € 885 mn).

 

F-5


Table of Contents

Allianz Group

 

Notes to the Consolidated Financial Statements (unaudited)

 

as of September 30, 2005 and December 31, 2004 and for the three months and nine months ended September 30, 2005 and 2004

 

1    Basis of presentation

 

The consolidated financial statements have been prepared in conformity with International Financial Reporting Standards (IFRS) as adopted under European Union (EU) regulations in accordance with clause 315a of the German Commercial Code (HGB). EU regulations require full compliance with IFRS with the exception of the IAS 39 carve-out rules. Nevertheless, the endorsement by the EU, i.e. the elimination of the carve-out-rule, is expected before year-end 2005 and thus the fair value option for liabilities is already applied. Since 2002, the designation IFRS applies to the overall framework of all standards approved by the International Accounting Standards Board. Already approved standards continue to be cited as International Accounting Standards (IAS). All standards currently applicable have been adopted in the preparation of these consolidated financial statements.

 

For years through 2004, IFRS did not provide specific guidance concerning the reporting of insurance and reinsurance contracts. Therefore, as envisioned in the IFRS Framework, the provisions embodied under accounting principles generally accepted in the United States of America (U.S. GAAP) have been applied. See Note 2 regarding changes to IFRS effective January 1, 2005. The financial statements are presented in Euros (€).

 

In certain cases, prior reporting period figures were reclassified in the consolidated balance sheet and in the consolidated income statement to make them comparable with the presentation of the current reporting period. These reclassifications had no impact on income.

 

2    Recently adopted accounting pronouncements

 

Effective January 1, 2005, the Allianz Group adopted IAS 32 revised, Financial Instruments: Disclosure and Presentation (“IAS 32 revised”) and IAS 39 revised, Financial Instruments: Recognition and Measurement (“IAS 39 revised”).

 

IAS 39 revised prohibits reversals of impairment losses on equity securities. According to the Allianz Group’s previous accounting policy, if the amount of an impairment previously recorded on an equity security decreases, the impairment was reversed. IAS 39 revised required retrospective application of this change; therefore, the Allianz Group’s previously issued consolidated financial statements were required to be restated to include the effects of this change. As a result of the adoption of this provision of IAS 39 revised, the Allianz Group recorded the following effects in its consolidated income statements:

 

(Debit) Credit


  

Three months

ended
September 30,

2004


   

Nine months

ended
September 30,
2004


 
     € mn     € mn  

Other income from investments

   (15 )   (262 )

Insurance and investment contract benefits (net)

   (27 )   93  

Other expenses from investments

   34     100  

Taxes

   5     18  

Minority interests in earnings

   (1 )   (5 )
    

 

Net impact on previously reported net income

   (4 )   (56 )
    

 

 

In accordance with IAS 32 revised, a financial instrument qualifies as a financial liability of the issuer if it gives the holder the right to put the instrument back to the issuer for cash or another financial asset (a “puttable instrument”). The classification as a financial liability is independent of considerations such as when the right is exercisable, how the amount payable or receivable upon exercise of the right is determined, and whether the puttable instrument has a fixed maturity. As a result of the adoption of IAS 32 revised, the Allianz Group was required to reclassify the minority interests in shareholders’ equity of certain consolidated investment funds to liabilities. These liabilities are

 

F-6


Table of Contents

Allianz Group

 

Notes to the Consolidated Financial Statements—(Continued)

 

as of September 30, 2005 and December 31, 2004 and for the three months and nine months ended September 30, 2005 and 2004

 

required to be recorded at redemption amount with changes recorded in the consolidated income statement.

 

Further, IAS 39 revised created a new category, designated at fair value through income, for financial assets. Financial assets designated at fair value through income are recognized at fair value with changes recognized in net income. As a result of being required to record the liabilities related to the previously mentioned consolidated investment funds at the redemption amount due to the adoption of IAS 32 revised, the Allianz Group reclassified the related investments from securities available-for-sale to financial assets designated at fair value through income. IAS 39 revised required retrospective application of these changes.

 

As a result of the adoption of these provisions of IAS 32 revised and IAS 39 revised, the Allianz Group recorded the following effects in its consolidated income statements:

 

(Debit) Credit


 

Three months

ended
September 30,

2004


   

Nine months

ended
September 30,
2004


 
    € mn     € mn  

Interest and similar income

  (9 )   (38 )

Other income from investments

  (54 )   (130 )

Income from financial assets and liabilities carried at fair value through income (net)

  38     125  

Insurance and investment contract benefits (net)

  10     (33 )

Other expenses from investments

  27     82  

Taxes

  (4 )   (2 )

Minority interests in earnings

  (7 )   2  
   

 

Net impact on previously reported net income

  1     6  
   

 

 

In addition, as a result of the adoption of IAS 39 revised, the Allianz Group reclassified certain securities available-for-sale to loans and advances to banks and loans and advances to customers. As a result of the adoption of this provision of IAS 39 revised, the Allianz Group recorded the following effects in its consolidated income statements:

 

(Debit) Credit


  

Three months

ended
September 30,

2004


   

Nine months

ended
September 30,
2004


 
     € mn     € mn  

Other income from investments

   11     8  

Other income

   (11 )   (8 )

Other expenses from investments

   33     45  

Other expenses

   (33 )   (45 )
    

 

Net impact on previously reported net income

   —       —    
    

 

 

Effective January 1, 2005, the Allianz Group adopted IFRS 2, Share Based Payments (“IFRS 2”). In accordance with IFRS 2, share based compensation plans are required to be classified as equity settled or cash settled plans. Equity settled plans are measured at fair value on the grant date with changes recognized in the income statement and shareholders’ equity over the vesting period. Cash settled plans are measured at fair value at each reporting date and recognized as liabilities. Changes in the fair value of cash settled plans are recognized as expense in the income statement.

 

A company is considered to have a cash settled plan if the shares issued are redeemable, either mandatorily or at the counter-party’s option. In this respect, IFRS 2 has incorporated the “puttable instrument” concept of IAS 32 revised, which requires that such instruments be classified as liabilities rather than equity instruments. As a result of the adoption of IFRS 2, the PIMCO LLC Class B Unit Purchase Plan (“Class B Plan”) is considered a cash settled plan as the equity instruments issued are puttable at the counter-party’s option. According to

 

F-7


Table of Contents

Allianz Group

 

Notes to the Consolidated Financial Statements—(Continued)

 

as of September 30, 2005 and December 31, 2004 and for the three months and nine months ended September 30, 2005 and 2004

 

the Allianz Group’s previous accounting policy, the Class B Plan was considered an equity settled plan.

 

Further, IFRS 2 requires that equity settled plans include a best estimate of the number of equity instruments that are expected to vest in determining the amount of expense to be recognized. The Allianz Group’s previous accounting policy required that forfeitures of equity instruments be recognized when incurred.

 

As a result of the adoption of IFRS 2, the Allianz Group recorded the following effects in its consolidated income statements:

 

(Debit) Credit


  

Three months

ended
September 30,

2004


   

Nine months

ended
September 30,
2004


 
     € mn     € mn  

Acquisition and administrative expenses (net)

   (60 )   (206 )

Taxes

   12     50  

Minority interests in earnings

   29     84  
    

 

Net impact on previously reported net income

   (19 )   (72 )
    

 

 

Effective January 1, 2005, the Allianz Group adopted IFRS 3, Business Combinations (“IFRS 3”). In accordance with IFRS 3, a company must cease the amortization of goodwill and intangible assets with an indefinite life and rather test for impairment on an annual basis in addition to whenever there is an indication that the carrying value is not recoverable. As a result of the adoption on IFRS 3 on January 1, 2005, the Allianz Group ceased amortization of goodwill and brand names.

 

Effective January 1, 2005, the Allianz Group adopted IFRS 4, Insurance Contracts (“IFRS 4”). IFRS 4 represents the completion of phase I and is a transitional standard until the IASB has more fully addressed the recognition and measurement of insurance contracts. IFRS 4 requires that all contracts issued by insurance companies be classified as either insurance contracts or investment contracts. Contracts with significant insurance risk are considered insurance contracts. IFRS 4 permits a company to continue with it’s previously adopted accounting policies with regard to recognition and measurement of insurance contracts. Only in case of presentation of more reliable figures a change in accounting policy shall be carried out. As a result, the Allianz Group principally continues to apply the provisions of US GAAP for the recognition and measurement of insurance contracts. Contracts issued by insurance companies without significant insurance risk are considered investment contracts. Investment contracts are accounted for in accordance with IAS 39 revised. As a result of the adoption of IFRS 4, certain contracts were reclassified as investment contracts. This change did not have a material effect on the Allianz Group’s shareholders’ equity as of December 31, 2003.

 

Further, the Allianz Group reclassified the assets related to unit-linked insurance and investment contracts to financial assets designated at fair value through income and the related liabilities to financial liabilities designated at fair value through income as allowed under the EU insurance directives.

 

As a result of this reclassification, the Allianz Group recorded the following effects in its consolidated income statements:

 

(Debit) Credit


 

Three months

ended
September 30,

2004


   

Nine months

ended
September 30,
2004


 
    € mn     € mn  

Income from financial assets and liabilities carried at fair value through income (net)

  12     (105 )

Insurance and investment contract benefits (net)

  (12 )   105  
   

 

Net impact on previously reported net income

  —       —    
   

 

 

F-8


Table of Contents

Allianz Group

 

Notes to the Consolidated Financial Statements—(Continued)

 

as of September 30, 2005 and December 31, 2004 and for the three months and nine months ended September 30, 2005 and 2004

 

Impairments of equity securities

 

IAS 39 revised requires a change to the Allianz Group’s impairment criteria for available-for-sale equity securities. An equity security is considered to be impaired if there is objective evidence that the cost of the equity security may not be recovered. IAS 39 revised requires that a significant or prolonged decline in the fair value of an equity security below cost is considered to be objective evidence of impairment. The Allianz Group established, beside the existing qualitative impairment criteria, new quantitative impairment criteria for equity securities to define significant or prolonged decline. To satisfy the significant criteria, the Allianz Group has established a policy that an equity security is considered impaired if the fair value is below the weighted-average cost by more than 20%. To satisfy the prolonged criteria, the Allianz Group established a policy that an equity security is considered impaired if the fair value is below the weighted-average cost for greater than nine months. Each of these policies is applied independently at the subsidiary level.

 

In addition, IAS 39 revised does not allow an adjusted cost basis to be established upon impairment of an equity security. Rather, each reporting period, if the fair value is less than the original cost basis of the equity security, the security is analyzed for impairment based upon the Allianz Group’s impairment criteria. At each reporting date, for equity securities that are determined to be impaired based upon the Allianz Group’s impairment criteria, an impairment is recognized for the difference between the fair value and the original cost basis, less any previously recognized impairments. According to the Allianz Group’s previously applied accounting policy, upon the recognition of an impairment of an equity security, an adjusted cost basis was established. Therefore, at each reporting period, if the fair value was less than the adjusted cost basis of the equity security, the security was analyzed for impairment based upon the Allianz Group’s impairment criteria.

 

As a result, the Allianz Group recorded the following effects in the consolidated income statements:

 

(Debit) Credit


  

Three months

ended
September 30,

2004


   

Nine months

ended
September 30,
2004


 
     € mn     € mn  

Other income from investments

   111     742  

Insurance and investment contract benefits (net)

   17     (138 )

Other expenses from investments

   (157 )   (199 )

Taxes

   (15 )   (70 )

Minority interests in earnings

   (3 )   (68 )
    

 

Net impact on previously reported net income

   (47 )   267  
    

 

 

F-9


Table of Contents

Allianz Group

 

Notes to the Consolidated Financial Statements—(Continued)

 

as of September 30, 2005 and December 31, 2004 and for the three months and nine months ended September 30, 2005 and 2004

 

Fair value option for financial liabilities

 

IAS 39 revised created a new category, designated at fair value through income, for financial assets and liabilities. Both, financial assets and liabilities designated at fair value through income are recognised at fair value with changes recognised in net income. The Allianz Group already implemented this new rule for financial assets as of January 1, 2005. The implementation of this regulation with regard to financial liabilities was not allowed because the EU did not endorse it based on the revised IAS 39. In June 2005 the IASB adjusted the fair value regulation and considered the concerns raised by the EU. It is expected that the EU will endorse the new rules in the fourth quarter 2005. Thus, the Allianz Group already applied the fair value option for financial liabilities retrospectively in the third quarter due to the forthcoming EU endorsement.

 

This change did not have a material effect on net income for the three and nine months ended September 30, 2004.

 

Discretionary participating features

 

IFRS 4 contains specific guidance for contracts with discretionary participation features (DPF). These include other contracts that have additional payments where the timing or amount is at the discretion of the company. Based on this definition the Allianz Group recognised retrospectively a deferred premium refund for specific contracts for the Swiss business.

 

This change did not have a material effect on net income for the three and nine months ended September 30, 2004.

 

F-10


Table of Contents

Allianz Group

 

Notes to the Consolidated Financial Statements—(Continued)

 

as of September 30, 2005 and December 31, 2004 and for the three months and nine months ended September 30, 2005 and 2004

 

3    Segment reporting

 

Business Segment Information—Consolidated Balance Sheets

As of September 30, 2005 and as of December 31, 2004

 

     Property-Casualty

   Life/Health

   September 30,
2005


   December 31,
2004


   September 30,
2005


   December 31,
2004


   € mn    € mn    € mn    € mn

ASSETS

                   

Intangible assets

   2,230    2,185    4,012    4,075

Investments in associated enterprises and joint ventures

   48,231    48,359    4,038    5,532

Investments

   86,612    81,245    173,886    154,920

Loans and advances to banks

   13,632    7,424    56,984    56,699

Loans and advances to customers

   2,006    6,224    27,658    28,808

Financial assets carried at fair value through income

   3,285    1,137    61,708    46,668

Cash and cash equivalents

   2,336    1,665    1,574    968

Amounts ceded to reinsurers from reserves for insurance and investment contracts

   14,561    12,337    10,827    16,382

Deferred tax assets

   7,597    6,816    3,849    3,451

Other assets

   21,579    20,045    23,501    20,362
    
  
  
  

Total segment assets

   202,069    187,437    368,037    337,865
    
  
  
  
     Property-Casualty

   Life/Health

   September 30,
2005


   December 31,
2004


   September 30,
2005


   December 31,
2004


   € mn    € mn    € mn    € mn

SHAREHOLDERS’ EQUITY AND LIABILITIES

                   

Participation certificates and subordinated liabilities

   7,307    5,497    140    141

Reserves for insurance and investment contracts

   86,931    83,095    271,574    249,854

Liabilities to banks

   2,605    1,358    1,082    1,241

Liabilities to customers

   5,080    5,336    74    165

Certificated liabilities

   9,668    11,405    4    68

Financial liabilities carried at fair value through income

   1,252    530    56,679    44,776

Other accrued liabilities

   6,032    5,960    856    1,016

Other liabilities

   13,652    12,352    16,371    21,280

Deferred tax liabilities

   8,310    7,894    5,172    4,539

Deferred income

   124    161    124    139
    
  
  
  

Total segment liabilities

   140,961    133,588    352,076    323,219
    
  
  
  

*) Shareholders’ equity and minority interests in shareholders’ equity.

 

F-11


Table of Contents

Allianz Group

 

Notes to the Consolidated Financial Statements—(Continued)

 

as of September 30, 2005 and December 31, 2004 and for the three months and nine months ended September 30, 2005 and 2004

 

    Banking

  Asset Management

  Consolidation Adjustments

    Group

  September 30,
2005


  December 31,
2004


  September 30,
2005


  December 31,
2004


  September 30,
2005


    December 31,
2004


    September 30,
2005


  December 31,
2004


  € mn   € mn   € mn   € mn   € mn     € mn     € mn   € mn
    2,541   2,526   6,682   6,362   —       (1 )   15,465   15,147
    2,764   3,037   3   3   (51,566 )   (51,174 )   3,470   5,757
    16,672   17,736   800   529   (1,793 )   (6,103 )   276,177   248,327
    81,281   119,025   274   144   (2,123 )   (1,749 )   150,048   181,543
    171,348   168,346   85   29   (7,918 )   (7,727 )   193,179   195,680
    169,914   192,746   307   131   (117 )   (108 )   235,097   240,574
    20,054   13,097   588   431   (459 )   (533 )   24,093   15,628
    —     —     —     —     (1,855 )   (6,409 )   23,533   22,310
    3,588   3,679   202   187   6     6     15,242   14,139
    10,131   15,341   3,407   2,942   (5,724 )   (7,477 )   52,894   51,213
   
 
 
 
 

 

 
 
    478,293   535,533   12,348   10,758   (71,549 )   (81,275 )   989,198   990,318
   
 
 
 
 

 

 
 
    Banking

  Asset Management

  Consolidation Adjustments

    Group

 

September 30,

2005


 

December 31,

2004


 

September 30,

2005


 

December 31,

2004


 

September 30,

2005


   

December 31,

2004


   

September 30,

2005


 

December 31,

2004


  € mn   € mn   € mn   € mn   € mn     € mn     € mn   € mn
    7,308   7,815   —     —     (208 )   (223 )   14,547   13,230
    4   4   —     —     (2,020 )   (6,573 )   356,489   326,380
    144,644   189,187   41   7   (374 )   (446 )   147,998   191,347
    161,718   158,127   500   294   (7,465 )   (6,785 )   159,907   157,137
    49,610   47,041   4   4   (641 )   (766 )   58,645   57,752
    83,277   99,934   —     —     (123 )   (103 )   141,085   145,137
    5,115   5,783   1,794   1,225   —       —       13,797   13,984
    4,482   8,859   1,290   709   (6,641 )   (11,929 )   29,154   31,271
    1,989   1,860   73   57   —       —       15,544   14,350
    3,170   1,737   26   2   —       —       3,444   2,039
   
 
 
 
 

 

 
 
    461,317   520,347   3,728   2,298   (17,472 )   (26,825 )   940,610   952,627
   
 
 
 
 

 

 
 
    Shareholders’ equity*)     48,588   37,691
                               
 
    Total shareholders’ equity and liabilities     989,198   990,318
                               
 

 

F-12


Table of Contents

Allianz Group

 

Notes to the Consolidated Financial Statements—(Continued)

 

as of September 30, 2005 and December 31, 2004 and for the three months and nine months ended September 30, 2005 and 2004

 

Business Segment Information—Consolidated Income Statements

for the three months ended September 30, 2005 and 2004

 

     Property-Casualty

    Life/Health

 

Three months ended September 30,


   2005

    2004

    2005

    2004

 
     € mn     € mn     € mn     € mn  

Premiums earned (net)

   9,788     9,840     4,206     3,990  

Interest and similar income

   906     932     2,846     2,693  

Income from associated enterprises and joint ventures (net)

   152     72     54     82  

Other income from investments

   329     207     639     443  

Income from financial assets and liabilities carried at fair value through income (net)

   (65 )   3     291     103  

Fee and commission income, and income from service activities

   451     243     53     52  

Other income

   176     281     211     387  
    

 

 

 

Total income

   11,737     11,578     8,300     7,750  
    

 

 

 

Insurance and investment contract benefits (net)

   (7,247 )   (6,853 )   (6,128 )   (5,465 )

Interest and similar expenses

   (243 )   (369 )   (102 )   (212 )

Other expenses from investments

   (74 )   (319 )   (187 )   (275 )

Loan loss provisions

   (3 )   2     6     (1 )

Acquisition costs and administrative expenses (net)

   (2,799 )   (2,654 )   (1,077 )   (1,199 )

Amortization of goodwill

   —       (96 )   —       (40 )

Other expenses

   (505 )   (337 )   (149 )   (176 )
    

 

 

 

Total expenses

   (10,871 )   (10,626 )   (7,637 )   (7,368 )
    

 

 

 

Earnings from ordinary activities before taxes

   866     952     663     382  

Taxes

   (277 )   (452 )   (147 )   (186 )

Minority interests in earnings

   (181 )   (132 )   (140 )   (71 )
    

 

 

 

Net income

   408     368     376     125  
    

 

 

 

 

F-13


Table of Contents

Allianz Group

 

Notes to the Consolidated Financial Statements—(Continued)

 

as of September 30, 2005 and December 31, 2004 and for the three months and nine months ended September 30, 2005 and 2004

 

 

 

     Banking

    Asset Management

    Consolidation Adjustments

    Group

 
     2005

    2004

        2005    

        2004    

        2005    

        2004    

    2005

    2004

 
     € mn     € mn     € mn     € mn     € mn     € mn     € mn     € mn  
     —       —       —       —       —       —       13,994     13,830  
     1,643     1,751     23     16     (136 )   (211 )   5,282     5,181  
     54     29     —       —       (180 )   (115 )   80     68  
     44     130     1     —       (5 )   3     1,008     783  
     375     244     16     (1 )   —       (3 )   617     346  
     772     701     968     778     (170 )   (158 )   2,074     1,616  
     35     42     5     6     (19 )   (38 )   408     678  
    

 

 

 

 

 

 

 

     2,923     2,897     1,013     799     (510 )   (522 )   23,463     22,502  
    

 

 

 

 

 

 

 

     —       —       —       —       —       —       (13,375 )   (12,318 )
     (1,165 )   (1,092 )   (11 )   (3 )   134     216     (1,387 )   (1,460 )
     (49 )   (56 )   —       (1 )   —       —       (310 )   (651 )
     129     (54 )   —       —       —       2     132     (51 )
     (1,558 )   (1,440 )   (891 )   (657 )   184     144     (6,141 )   (5,806 )
     —       (65 )   —       (96 )   —       —       —       (297 )
     (57 )   (177 )   (25 )   (95 )   12     55     (724 )   (730 )
    

 

 

 

 

 

 

 

     (2,700 )   (2,884 )   (927 )   (852 )   330     417     (21,805 )   (21,313 )
    

 

 

 

 

 

 

 

     223     13     86     (53 )   (180 )   (105 )   1,658     1,189  
     (74 )   134     (34 )   9     2     (2 )   (530 )   (497 )
     (26 )   (22 )   (12 )   (13 )   25     14     (334 )   (224 )
    

 

 

 

 

 

 

 

     123     125     40     (57 )   (153 )   (93 )   794     468  
    

 

 

 

 

 

 

 

 

F-14


Table of Contents

Allianz Group

 

Notes to the Consolidated Financial Statements—(Continued)

 

as of September 30, 2005 and December 31, 2004 and for the three months and nine months ended September 30, 2005 and 2004

 

Business Segment Information—Consolidated Income Statements

for the nine months ended September 30, 2005 and 2004

 

     Property-Casualty

    Life/Health

 

Nine months ended September 30,


   2005

    2004

    2005

    2004

 
     € mn     € mn     € mn     € mn  

Premiums earned (net)

   28,522     28,827     13,770     13,002  

Interest and similar income

   3,067     3,076     8,786     8,383  

Income from associated enterprises and joint ventures (net)

   1,305     1,560     724     283  

Other income from investments

   1,143     1,647     2,082     1,931  

Income from financial assets and liabilities carried at fair value through income (net)

   (166 )   (22 )   291     168  

Fee and commission income, and income from service activities

   1,266     672     136     154  

Other income

   817     650     669     971  
    

 

 

 

Total income

   35,954     36,410     26,458     24,892  
    

 

 

 

Insurance and investment contract benefits (net)

   (19,884 )   (20,575 )   (20,285 )   (18,285 )

Interest and similar expenses

   (1,125 )   (1,121 )   (340 )   (542 )

Other expenses from investments

   (270 )   (912 )   (498 )   (672 )

Loan loss provisions

   (3 )   (1 )   3     (2 )

Acquisition costs and administrative expenses (net)

   (8,305 )   (7,928 )   (3,055 )   (3,331 )

Amortization of goodwill

   —       (287 )   —       (119 )

Other expenses

   (1,985 )   (1,412 )   (499 )   (630 )
    

 

 

 

Total expenses

   (31,572 )   (32,236 )   (24,674 )   (23,581 )
    

 

 

 

Earnings from ordinary activities before taxes

   4,382     4,174     1,784     1,311  

Taxes

   (909 )   (1,069 )   (282 )   (442 )

Minority interests in earnings

   (724 )   (725 )   (394 )   (283 )
    

 

 

 

Net income

   2,749     2,380     1,108     586  
    

 

 

 

 

F-15


Table of Contents

Allianz Group

 

Notes to the Consolidated Financial Statements—(Continued)

 

as of September 30, 2005 and December 31, 2004 and for the three months and nine months ended September 30, 2005 and 2004

 

     Banking

    Asset Management

    Consolidation Adjustments

    Group

 
     2005

    2004

        2005    

        2004    

        2005    

        2004    

    2005

    2004

 
     € mn     € mn     € mn     € mn     € mn     € mn     € mn     € mn  
     —       —       —       —       —       —       42,292     41,829  
     5,100     4,878     67     47     (423 )   (611 )   16,597     15,773  
     238     116     —       —       (1,305 )   (1,252 )   962     707  
     596     515     6     7     (340 )   37     3,487     4,137  
     953     1,160     21     2     —       (3 )   1,099     1,305  
     2,412     2,310     2,661     2,283     (486 )   (457 )   5,989     4,962  
     249     195     22     23     (78 )   (48 )   1,679     1,791  
    

 

 

 

 

 

 

 

     9,548     9,174     2,777     2,362     (2,632 )   (2,334 )   72,105     70,504  
    

 

 

 

 

 

 

 

     —       —       —       —       (25 )   —       (40,194 )   (38,860 )
     (3,615 )   (3,162 )   (37 )   (10 )   417     601     (4,700 )   (4,234 )
     (137 )   (364 )   —       (2 )   (20 )   (152 )   (925 )   (2,102 )
     88     (271 )   —       —       —       1     88     (273 )
     (4,336 )   (4,446 )   (2,427 )   (2,010 )   525     429     (17,598 )   (17,286 )
     —       (194 )   —       (285 )   —       —       —       (885 )
     (207 )   (513 )   (84 )   (319 )   68     104     (2,707 )   (2,770 )
    

 

 

 

 

 

 

 

     (8,207 )   (8,950 )   (2,548 )   (2,626 )   965     983     (66,036 )   (66,410 )
    

 

 

 

 

 

 

 

     1,341     224     229     (264 )   (1,667 )   (1,351 )   6,069     4,094  
     (308 )   225     (51 )   42     9     4     (1,541 )   (1,240 )
     (77 )   (104 )   (34 )   (40 )   209     268     (1,020 )   (884 )
    

 

 

 

 

 

 

 

     956     345     144     (262 )   (1,449 )   (1,079 )   3,508     1,970  
    

 

 

 

 

 

 

 

 

F-16


Table of Contents

Allianz Group

 

Notes to the Consolidated Financial Statements—(Continued)

 

as of September 30, 2005 and December 31, 2004 and for the three months and nine months ended September 30, 2005 and 2004

 

The following table sets forth the total revenues, operating profit and IFRS net income for each of our business segments for the three months and nine months ended September 30, 2005 and 2004, as well as IFRS consolidated net income of the Allianz Group.

 

     Property-Casualty

    Life/Health

 

Three months ended September 30,


   2005

    2004

    2005

    2004

 
     € mn     € mn     € mn     € mn  

Total revenues*)

   10,472     10,432     11,116     10,841  

Operating profit

   696     1,138     478     378  
    

 

 

 

Earnings from ordinary activities before taxes

   866     952     663     382  

Taxes

   (277 )   (452 )   (147 )   (186 )

Minority interests in earnings

   (181 )   (132 )   (140 )   (71 )
    

 

 

 

Net income (loss)

   408     368     376     125  
    

 

 

 

Nine months ended September 30,

                        

Total revenues*)

   34,439     34,646     34,942     31,946  

Operating profit

   3,090     2,898     1,283     1,048  
    

 

 

 

Earnings from ordinary activities before taxes

   4,382     4,174     1,784     1,311  

Taxes

   (909 )   (1,069 )   (282 )   (442 )

Minority interests in earnings

   (724 )   (725 )   (394 )   (283 )
    

 

 

 

Net income (loss)

   2,749     2,380     1,108     586  
    

 

 

 


*) Total revenues comprise property-casualty segment’s gross premiums written, life/health segment’s statutory premiums, banking segment’s operating revenues, and asset management segment’s operating revenues.

 

F-17


Table of Contents

Allianz Group

 

Notes to the Consolidated Financial Statements—(Continued)

 

as of September 30, 2005 and December 31, 2004 and for the three months and nine months ended September 30, 2005 and 2004

 

     Banking

    Asset
Management


    Consolidation
Adjustments


   

Total

Group


 
     2005

    2004

    2005

    2004

    2005

    2004

    2005

    2004

 
     € mn     € mn     € mn     € mn     € mn     € mn     € mn     € mn  
     1,542     1,527     708     564     (63 )   (228 )   23,775     23,136  
     250     136     299     217     —       —       1,723     1,869  
    

 

 

 

 

 

 

 

     223     13     86     (53 )   (180 )   (105 )   1,658     1,189  
     (74 )   134     (34 )   9     2     (2 )   (530 )   (497 )
     (26 )   (22 )   (12 )   (13 )   25     14     (334 )   (224 )
    

 

 

 

 

 

 

 

     123     125     40     (57 )   (153 )   (93 )   794     468  
    

 

 

 

 

 

 

 

                                                  
     4,611     4,948     1,933     1,664     (192 )   (612 )   75,733     72,592  
     759     567     785     578     —       —       5,917     5,091  
    

 

 

 

 

 

 

 

     1,341     224     229     (264 )   (1,667 )   (1,351 )   6,069     4,094  
     (308 )   225     (51 )   42     9     4     (1,541 )   (1,240 )
     (77 )   (104 )   (34 )   (40 )   209     268     (1,020 )   (884 )
    

 

 

 

 

 

 

 

     956     345     144     (262 )   (1,449 )   (1,079 )   3,508     1,970  
    

 

 

 

 

 

 

 

 

F-18


Table of Contents

Allianz Group

 

Notes to the Consolidated Financial Statements—(Continued)

 

as of September 30, 2005 and December 31, 2004 and for the three months and nine months ended September 30, 2005 and 2004

 

Property-Casualty Insurance Segment

 

    

Three months

ended

September 30,


   

Nine months

ended

September 30,


 
         2005    

        2004    

        2005    

        2004    

 
     € mn     € mn     € mn     € mn  

Gross premiums written

   10,472     10,432     34,439     34,646  

Premiums earned (net)1)

   9,788     9,840     28,522     28,827  

Current income from investments (net)2)

   776     721     2,622     2,387  

Insurance benefits (net)3)

   (7,225 )   (6,803 )   (19,845 )   (20,249 )

Net acquisition costs and administrative expenses4)

   (2,648 )   (2,540 )   (7,954 )   (7,619 )

Other operating income/(expenses)(net)

   5     (80 )   (255 )   (448 )
    

 

 

 

Operating profit

   696     1,138     3,090     2,898  
    

 

 

 

Net capital gains and impairments on investments5)

   296     (112 )   1,040     982  

Net trading income/(expenses)6)

   (108 )   (1 )   (269 )   (36 )

Intra-group dividends and profit transfer

   143     96     1,207     1,145  

Interest expense on external debt

   (160 )   (199 )   (630 )   (654 )

Amortization of goodwill7)

   —       (96 )   —       (287 )

Restructuring charges

   (1 )   —       (56 )   —    

Other non-operating income/(expenses) (net)

   —       126     —       126  
    

 

 

 

Earnings from ordinary activities before taxes

   866     952     4,382     4,174  
    

 

 

 

Taxes

   (277 )   (452 )   (909 )   (1,069 )

Minority interests in earnings

   (181 )   (132 )   (724 )   (725 )
    

 

 

 

Net income

   408     368     2,749     2,380  
    

 

 

 

Loss ratio8) in %

   72.9     66.4     68.2     68.2  

Expense ratio9) in %

   24.1     24.5     24.8     25.0  
    

 

 

 

Combined ratio in %

   97.0     90.9     93.0     93.2  
    

 

 

 


1) Net of earned premiums ceded to reinsurers of € 1,614 million and € 4,071 million for the three and nine months ended September 30, 2005, respectively (3Q 2004: € 1,518 million and 9M 2004: € 4,079 million).
2) Net of investment management expenses of € 88 million and € 257 million for the three and nine months ended September 30, 2005, respectively (3Q 2004: € 79 million and 9M 2004: € 244 million), and interest expenses of € 21 million and € 136 million for the three and nine months ended September 30, 2005, respectively (3Q 2004: € 99 million and 9M 2004: € 341 million).
3) Comprises net claims incurred of € 7,130 million and € 19,456 million for the three and nine months ended September 30, 2005, respectively (3Q 2004: € 6,529 million and 9M 2004: € 19,655 million), net expenses from changes in other net underwriting provisions of € 44 million and € 130 million for the three and nine months ended September 30, 2005, respectively (3Q 2004: € 212 million and 9M 2004: € 398 million), and net expenses for premium refunds of € 51 million and € 259 million for the three and nine months ended September 30, 2005, respectively (3Q 2004: € 62 million and 9M 2004: € 196 million). Net expenses for premium refunds were adjusted for income of € 6 million and € 24 million for the three and nine months ended September 30, 2005, respectively (3Q 2004: € – million and 9M 2004: € 220 million), related to policyholders’ participation of net capital gains and impairments on investments, as well as net trading income/(expenses), that were excluded from the determination of operating profit.
4) Comprises net acquisition costs of € 1,426 million and € 4,277 million for the three and nine months ended September 30, 2005, respectively (3Q 2004: € 1,435 million and 9M 2004: € 4,314 million), administrative expenses of € 937 million and € 2,799 million for the three and nine months ended September 30, 2005, respectively (3Q 2004: € 977 million and 9M 2004: € 2,885 million), and expenses for service agreements of € 285 million and € 878 million for the three and nine months ended September 30, 2005, respectively (3Q 2004: € 128 million and 9M 2004: € 420 million). Net acquisition costs and administrative expenses do not include expenses for the management of investments and, accordingly, do not reconcile to the acquisition costs and administrative expenses as presented in the consolidated financial statements.
5) Comprises net realized gains on investments of € 280 million and € 1,068 million for the three and nine months ended September 30, 2005, respectively (3Q 2004: € 88 million and 9M 2004: € 1,517 million), and net impairments on investments of € 16 million and € 28 million for the three and nine months ended September 30, 2005, respectively (3Q 2004: € 200 million and 9M 2004: € 535 million). These amounts are net of policyholders’ participation.
6) Net trading income/(expenses) are net of policyholders’ participation.
7) Effective January 1, 2005, under IFRS, and on a prospective basis, goodwill is no longer amortized.
8) Represents ratio of net claims incurred to net premiums earned.
9) Represents ratio of net acquisition costs and administrative expenses as presented in the consolidated financial statements to net premiums earned.

 

F-19


Table of Contents

Allianz Group

 

Notes to the Consolidated Financial Statements—(Continued)

 

as of September 30, 2005 and December 31, 2004 and for the three months and nine months ended September 30, 2005 and 2004

 

Life/Health Insurance Segment

 

    

Three months

ended

September 30,


   

Nine months

ended

September 30,


 
         2005    

        2004    

        2005    

        2004    

 
     € mn     € mn     € mn     € mn  

Statutory premiums1)

   11,116     10,841     34,942     31,946  

Gross premiums written

   4,508     4,465     14,643     14,579  

Premiums earned (net)2)

   4,206     3,990     13,770     13,002  

Current income from investments (net)3)

   2,764     2,597     8,547     8,156  

Insurance benefits (net)4)

   (5,697 )   (5,254 )   (18,005 )   (17,136 )

Net acquisition costs and administrative expenses5)

   (955 )   (1,083 )   (2,705 )   (2,989 )

Net trading income/(expenses)

   163     69     (185 )   62  

Other operating income/(expenses) (net)

   (3 )   59     (139 )   (47 )
    

 

 

 

Operating profit

   478     378     1,283     1,048  
    

 

 

 

Net capital gains and impairments on investments6)

   183     42     431     315  

Intra-group dividends and profit transfer

   20     2     88     67  

Amortization of goodwill7)

   —       (40 )   —       (119 )

Restructuring charges

   (18 )   —       (18 )   —    
    

 

 

 

Earnings from ordinary activities before taxes

   663     382     1,784     1,311  
    

 

 

 

Taxes

   (147 )   (186 )   (282 )   (442 )

Minority interests in earnings

   (140 )   (71 )   (394 )   (283 )
    

 

 

 

Net income

   376     125     1,108     586  
    

 

 

 

Statutory expense ratio8) in %

   8.5     10.1     7.7     9.6  
    

 

 

 


1) Under the Allianz Group’s accounting policies for life insurance contracts, for which we have adopted U.S. GAAP accounting standards, gross written premiums include only the cost- and risk-related components of premiums generated from unit-linked and other investment-oriented products, but do not include the full amount of statutory premiums written on these products. Statutory premiums are gross premiums written from sales of life insurance policies as well as gross receipts from sales of unit-linked and other investment-oriented products, in accordance with the statutory accounting practices applicable in the insurer’s home jurisdiction.
2) Net of earned premiums ceded to reinsurers of € 259 million and € 780 million for the three and nine months ended September 30, 2005, respectively (3Q 2004: € 463 million and 9M 2004: € 1,519 million).
3) Net of investment management expenses of € 117 million and € 332 million for the three and nine months ended September 30, 2005, respectively (3Q 2004: € 102 million and 9M 2004: € 309 million), and interest expenses of € 2 million and € (-) million for the three and nine months ended September 30, 2005, respectively (3Q 2004: € 24 million and 9M 2004: € (35) million).
4) Net insurance benefits were adjusted for income of € 428 million and € 2,279 million for the three and nine months ended September 30, 2005, respectively (3Q 2004: € 212 million and 9M 2004: € 1,152 million), related to policyholders’ participation of net capital gains and impairments on investments that were excluded from the determination of operating profit.
5) Comprises net acquisition costs of € 598 million and € 1,617 million for the three and nine months ended September 30, 2005, respectively (3Q 2004: € 712 million and 9M 2004: € 1,959 million), administrative expenses of € 323 million and € 993 million for the three and nine months ended September 30, 2005, respectively (3Q 2004: € 342 million and 9M 2004: € 941 million), and expenses for service agreements of € 34 million and € 95 million for the three and nine months ended September 30, 2005, respectively (3Q 2004: € 29 million and 9M 2004: € 89 million). Net acquisition costs and administrative expenses do not include expenses for the management of investments and, accordingly, do not reconcile to the acquisition costs and administrative expenses as presented in the consolidated financial statements.
6) Comprises net realized gains on investments of € 191 million and € 510 million for the three and nine months ended September 30, 2005, respectively (3Q 2004: € 139 million and 9M 2004: € 423 million), and net impairments on investments of € 8 million and € 79 million for the three and nine months ended September 30, 2005, respectively (3Q 2004: € 97 million and 9M 2004: € 108 million). These amounts are net of policyholders’ participation.
7) Effective January 1, 2005, under IFRS, and on a prospective basis, goodwill is no longer amortized.
8) Represents ratio of net acquisition costs and administrative expenses as presented in the consolidated financial statements to net premiums earned (statutory).

 

F-20


Table of Contents

Allianz Group

 

Notes to the Consolidated Financial Statements—(Continued)

 

as of September 30, 2005 and December 31, 2004 and for the three months and nine months ended September 30, 2005 and 2004

 

Banking Segment

 

     Three months ended September 30,

    Nine months ended September 30,

 
     2005

    2004

    2005

    2004

 
     Banking
Segment


    Dresdner
Bank


    Banking
Segment


    Dresdner
Bank


    Banking
Segment


    Dresdner
Bank


    Banking
Segment


    Dresdner
Bank


 
     € mn     € mn     € mn     € mn     € mn     € mn     € mn     € mn  

Net interest income

   532     517     685     655     1,641     1,588     1,815     1,753  

Net fee and commission income

   635     599     598     569     2,017     1,909     1,974     1,858  

Net trading income

   375     358     244     250     953     916     1,159     1,165  
    

 

 

 

 

 

 

 

Operating revenues

   1,542     1,474     1,527     1,474     4,611     4,413     4,948     4,776  

Administrative expenses

   (1,421 )   (1,373 )   (1,337 )   (1,293 )   (3,940 )   (3,786 )   (4,110 )   (3,969 )

Net loan loss provisions

   129     130     (54 )   (54 )   88     84     (271 )   (271 )
    

 

 

 

 

 

 

 

Operating profit

   250     231     136     127     759     711     567     536  

Net capital gains and impairments on investments

   (5 )1)   (4 )   78 1)   77     541 1)   542     170 1)   161  

Restructuring charges

   (5 )   (5 )   (11 )   (11 )   (10 )   (10 )   (127 )   (127 )

Other non-operating income/(expenses)(net)

   (17 )   (25 )   (125 )   (119 )   51     43     (192 )   (182 )

Amortization of goodwill2)

   —       —       (65 )   (65 )   —       —       (194 )   (194 )
    

 

 

 

 

 

 

 

Earnings from ordinary activities before taxes

   223     197     13     9     1,341     1,286     224     194  

Taxes

   (74 )   (65 )   134     129     (308 )   (294 )   225     235  

Minority interests in earnings

   (26 )   (19 )   (22 )   (18 )   (77 )   (60 )   (104 )   (56 )
    

 

 

 

 

 

 

 

Net income

   123     113     125     120     956     932     345     373  
    

 

 

 

 

 

 

 

Cost-income ratio3) in %

   92.2     93.1     87.6     87.7     85.4     85.8     83.1     83.1  
    

 

 

 

 

 

 

 


1) Comprises primarily net realized gains on investments of € 29 million and € 649 million for the three and nine months ended September 30, 2005, respectively (3Q 2004: € 145 million and 9M 2004: € 511 million), and net impairments on investments of € 34 million and € 112 million for the three and nine months ended September 30, 2005, respectively (3Q 2004: € 71 million and 9M 2004: € 371 million). For the three and nine months ended September 30, 2005, net impairments on investments includes € 9 million and € 28 million, respectively, (3Q 2004: € 12 million and 9M 2004: € 23 million) of scheduled depreciation of real estate used by third parties.
2) Effective January 1, 2005, under IFRS, and on a prospective basis, goodwill is no longer amortized.
3) Represents ratio of administrative expenses to operating revenues.

 

F-21


Table of Contents

Allianz Group

 

Notes to the Consolidated Financial Statements—(Continued)

 

as of September 30, 2005 and December 31, 2004 and for the three months and nine months ended September 30, 2005 and 2004

 

Asset Management Segment

 

    Three months ended September 30,

    Nine months ended September 30,

 
    2005

    2004

    2005

    2004

 
    Asset
Management
Segment


    Allianz
Global
Investors


    Asset
Management
Segment


    Allianz
Global
Investors


    Asset
Management
Segment


    Allianz
Global
Investors


    Asset
Management
Segment


    Allianz
Global
Investors


 
    € mn     € mn     € mn     € mn     € mn     € mn     € mn     € mn  

Operating revenues

  708     698     564     558     1,933     1,906     1,664     1,658  

Operating expenses

  (409 )   (403 )   (347 )   (346 )   (1,148 )   (1,129 )   (1,086 )   (1,085 )
   

 

 

 

 

 

 

 

Operating profit

  299     295     217     212     785     777     578     573  

Acquisition-related expenses

  (213 )   (213 )   (174 )   (174 )   (556 )   (556 )   (557 )   (557 )

thereof:

                                               

Deferred purchases of interests in PIMCO1)

  (213 )   (213 )   (111 )   (111 )   (519 )   (519 )   (364 )   (364 )

Retention payments for management and employees of PIMCO and Nicholas Applegate

  —       —       (31 )   (31 )   (12 )   (12 )   (98 )   (98 )

Amortization charges relating to capitalized bonuses for PIMCO management

  —       —       (32 )   (32 )   (25 )   (25 )   (95 )   (95 )

Amortization of goodwill2)

  —       —       (96 )   (96 )   —       —       (285 )   (285 )
   

 

 

 

 

 

 

 

Earnings from ordinary activities before taxes

  86     82     (53 )   (58 )   229     221     (264 )   (269 )

Taxes

  (34 )   (32 )   9     9     (51 )   (49 )   42     42  

Minority interests in earnings

  (12 )   (12 )   (13 )   (13 )   (34 )   (32 )   (40 )   (40 )
   

 

 

 

 

 

 

 

Net income (loss)

  40     38     (57 )   (62 )   144     140     (262 )   (267 )
   

 

 

 

 

 

 

 

Cost-income ratio3) in %

  57.8     57.7     61.5     62.0     59.4     59.2     65.3     65.4  
   

 

 

 

 

 

 

 


1) Effective January 1, 2005, and applied retrospectively, under IFRS, the PIMCO LLC Class B Unit Purchase Plan (“Class B Plan”) is considered a cash settled plan, resulting in changes in the fair value of the shares issued to be recognized as expense.
2) Effective January 1, 2005, under IFRS, and on a prospective basis, goodwill is no longer amortized.
3) Represents ratio of operating expenses to operating revenues.

 

F-22


Table of Contents

Allianz Group

 

Notes to the Consolidated Financial Statements—(Continued)

 

as of September 30, 2005 and December 31, 2004 and for the three months and nine months ended September 30, 2005 and 2004

 

Supplementary Information to the Consolidated Balance Sheets

 

4    Intangible assets

 

     September 30,
2005


   December 31,
2004


     € mn    € mn

Goodwill

   12,097    11,677

Present value of future profits

   1,398    1,522

Software

   1,030    972

Brand names

   740    740

Loyalty bonuses

   —      33

Other

   200    203
    
  

Total

   15,465    15,147
    
  

 

Changes in goodwill for the nine months ended September 30, 2005, were as follows:

 

     € mn

 

Cost as of December 31, 2004

   11,901  

Accumulated impairments as of December 31, 2004

   (224 )
    

Carrying value as of December 31, 2004

   11,677  
    

Additions

   57  

Disposals

   (45 )

Foreign currency translation adjustments

   408  
    

Carrying value as of September 30, 2005

   12,097  
    

Accumulated impairments as of September 30, 2005

   224  

Cost as of September 30, 2005

   12,321  

 

Additions include goodwill from

 

    increasing the interest in GamePlan Financial Marketing LLC, Woodstock, by 60.0% to 100.0%,

 

    the acquisition of 100.0% interest in Bettercare Group Limited, Kingston upon Thames.

 

Disposals include goodwill from

 

    reducing the interest in Cadence Capital Management Inc., Delaware, by 100.0% to 0.0%.

 

5    Investments

 

     September 30,
2005


   December 31,
2004


     € mn    € mn

Securities held-to-maturity

   4,986    5,179

Securities available-for-sale

   258,797    230,919

Real estate used by third parties

   10,781    10,628

Funds held by others under reinsurance contracts assumed

   1,613    1,601
    
  

Total

   276,177    248,327
    
  

 

Securities available-for-sale

 

    Amortized cost

  Unrealized gains

  Unrealized losses

    Fair values

    September 30,
2005


  December 31,
2004


  September 30,
2005


  December 31,
2004


  September 30,
2005


    December 31,
2004


    September 30,
2005


  December 31,
2004


    € mn   € mn   € mn   € mn   € mn     € mn     € mn   € mn

Equity securities

  35,671   32,106   17,293   12,488   (212 )   (394 )   52,752   44,200

Government bonds

  115,136   106,155   7,470   5,375   (346 )   (235 )   122,260   111,295

Corporate bonds

  77,986   69,083   4,344   3,629   (197 )   (95 )   82,133   72,617

Other

  1,483   2,721   170   90   (1 )   (4 )   1,652   2,807
   
 
 
 
 

 

 
 

Total

  230,276   210,065   29,277   21,582   (756 )   (728 )   258,797   230,919
   
 
 
 
 

 

 
 

 

F-23


Table of Contents

Allianz Group

 

Notes to the Consolidated Financial Statements—(Continued)

 

as of September 30, 2005 and December 31, 2004 and for the three months and nine months ended September 30, 2005 and 2004

 

Nine months ended September 30,


   Gross realized gains

   Gross realized losses

 
       2005    

       2004    

       2005    

        2004    

 
     € mn    € mn    € mn     € mn  

Equity securities

   2,383    2,997    (257 )   (408 )

Debt securities

   789    849    (226 )   (241 )

Other

   24    26    (8 )   (43 )
    
  
  

 

Total

   3,196    3,872    (491 )   (692 )
    
  
  

 

 

6    Loans and advances to banks

 

     September 30,
2005


    December 31,
2004


 
     € mn     € mn  

Loans

   67,429     59,543  

Reverse repurchase agreements and collateral paid for securities borrowing transactions

   66,334     103,406  

Short-term investments and certificates of deposit

   9,248     7,729  

Other

   7,282     11,096  
    

 

Loans and advances to banks

   150,293     181,774  

Loan loss allowance

   (245 )   (231 )
    

 

Total

   150,048     181,543  
    

 

 

7    Loans and advances to customers

 

     September 30,
2005


    December 31,
2004


 
     € mn     € mn  

Loans

   116,514     119,832  

Reverse repurchase agreements and collateral paid for securities borrowing transactions

   61,425     70,459  

Other

   16,869     9,293  
    

 

Loans and advances to customers

   194,808     199,584  

Loan loss allowance

   (1,629 )   (3,904 )
    

 

Total

   193,179     195,680  
    

 

 

8    Financial assets carried at fair value through income

 

     September 30,
2005


   December 31,
2004


     € mn    € mn

Financial assets held for trading

   170,569    194,439

Financial assets for unit linked contracts

   51,663    41,409

Financial assets designated at fair value through income

   12,865    4,726
    
  

Total

   235,097    240,574
    
  

 

Financial assets held for trading comprised the following:

 

     September 30,
2005


   December 31,
2004


     € mn    € mn

Fixed-income securities

   124,382    153,858

Equities

   25,725    20,033

Derivative financial instruments

   20,462    20,548
    
  

Total

   170,569    194,439
    
  

 

9    Amounts ceded to reinsurers from reserves for insurance and investment contracts

 

     September 30,
2005


   December 31,
2004


     € mn    € mn

Unearned premiums

   1,607    1,238

Aggregate policy reserves

   9,134    10,276

Reserves for loss and loss adjustment expenses

   12,688    10,684

Other insurance reserves

   104    112
    
  

Total

   23,533    22,310
    
  

 

F-24


Table of Contents

Allianz Group

 

Notes to the Consolidated Financial Statements—(Continued)

 

as of September 30, 2005 and December 31, 2004 and for the three months and nine months ended September 30, 2005 and 2004

 

10    Shareholders’ equity

 

     September 30,
2005


    December 31,
2004


 
     € mn     € mn  

Issued capital

   1,037     988  

Capital reserve

   20,460     18,445  

Revenue reserves

   10,063     10,498  

Treasury shares

   (63 )   (4,605 )

Foreign currency translation adjustments

   (1,204 )   (2,634 )

Unrealized gains and losses (net)

   9,525     7,303  
    

 

Shareholders’ equity before minority interests

   39,818     29,995  

Minority interests in shareholders’ equity

   8,770     7,696  
    

 

Total

   48,588     37,691  
    

 

 

On February 18, 2005, the Allianz Group issued a subordinated bond with € 11.2 mn detachable warrants, which allow the holder to purchase a share of Allianz AG. The warrants are exercisable at any time during their 3 year term and have an exercise price of € 92 per share. The warrants were recorded in capital reserve at the premium received of € 174 mn on their issuance date. As a result of the exercise of 9 mn warrants during the third quarter 2005, the consideration received of € 828 mn was recorded in issued capital, € 23 mn, and capital reserve, € 805 mn. During the third quarter 2005, the Allianz Group issued 10,116,850 shares for proceeds of € 1,062 mn, which was recorded in issued capital, € 26 mn, and capital reserve € 1,036 mn.

 

Minority interests in shareholders’ equity are comprised of the following:

 

     September 30,
2005


   December 31,
2004


     € mn    € mn

Unrealized gains and losses (net)

   1,685    1,206

Share of earnings

   1,020    1,168

Other equity components

   6,065    5,322
    
  

Total

   8,770    7,696
    
  

 

The primary subsidiaries of the Allianz Group included in minority interests in shareholders’ equity are AGF Group, Paris and RAS Group, Milan.

 

11    Participation certificates and subordinated liabilities

 

     September 30,
2005


   December 31,
2004


     € mn    € mn

Allianz AG*)

         

Subordinated bonds

   6,188    4,775

Participation certificates

   85    85
    
  

Subtotal

   6,273    4,860
    
  

Banking subsidiaries

         

Subordinated liabilities

   4,179    4,779

Hybrid equity

   1,599    1,500

Participation certificates

   1,520    1,526
    
  

Subtotal

   7,298    7,805
    
  

All other subsidiaries

         

Subordinated liabilities

   931    520

Hybrid equity

   45    45
    
  

Subtotal

   976    565
    
  

Total

   14,547    13,230
    
  

*) Includes subordinated bonds issued by Allianz Finance II B.V. and guaranteed by Allianz AG.

 

On February 18, 2005, the Allianz Group issued a subordinated bond with a principal amount of € 1,400 mn. The subordinated bond is perpetual, however, the Allianz Group has the right to call the bond after 12 years. The subordinated bond has a coupon rate of 4.375%.

 

On January 27, 2005, the AGF Group issued a subordinated bond with a principal amount of € 400 mn. The subordinated bond is perpetual and has a coupon rate of 4.625%.

 

F-25


Table of Contents

Allianz Group

 

Notes to the Consolidated Financial Statements—(Continued)

 

as of September 30, 2005 and December 31, 2004 and for the three months and nine months ended September 30, 2005 and 2004

 

12    Reserves for insurance and investment contracts

 

     September 30,
2005


   December 31,
2004


     € mn    € mn

Unearned premiums

   14,478    12,050

Aggregate policy reserves

   244,286    229,873

Reserves for loss and loss adjustment expenses

   68,176    62,331

Reserves for premium refunds

   28,741    21,237

Other insurance reserves

   808    889
    
  

Total

   356,489    326,380
    
  

 

Reserves for loss and loss adjustment expenses are comprised of the following:

 

    

September 30,

2005


  

December 31,

2004


     € mn    € mn

Property-Casualty

   61,133    55,536

Life/Health

   7,043    6,795
    
  

Total

   68,176    62,331
    
  

 

Changes in the reserves for loss and loss adjustment expenses for the Property-Casualty insurance segment for the nine months ended September 30, 2005, were as follows:

 

     2005

 
     € mn  

Gross reserves for loss and loss adjustment expenses as of January 1,

   55,536  

Amount ceded to reinsurers

   (10,029 )
    

Net reserves for loss and loss adjustment expenses as of January 1,

   45,507  
    

Loss and loss adjustment expenses incurred (net)

      

Current year

   19,846  

Prior years

   (593 )
    

Subtotal

   19,253  
    

Loss and loss adjustment expenses paid (net)

      

Current year

   (7,599 )

Prior years

   (9,277 )
    

Subtotal

   (16,876 )
    

Foreign currency translation adjustments

   1,369  
    

Net reserves for loss and loss adjustment expenses as of September 30,

   49,253  

Amount ceded to reinsurers

   11,880  
    

Gross reserves for loss and loss adjustment expenses as of September 30,

   61,133  
    

 

F-26


Table of Contents

Allianz Group

 

Notes to the Consolidated Financial Statements—(Continued)

 

as of September 30, 2005 and December 31, 2004 and for the three months and nine months ended September 30, 2005 and 2004

 

Asbestos and Environmental (A&E) Reserves

 

In the United States, the planned external review of the asbestos & environmental (or “A&E”) liability reserves at Fireman’s Fund had no net impact at the Allianz Group level as a result of already sufficient reserves, absent a $ 56 mn loss caused by the increase in provisions for uncollectible reinsurance recoverables.

 

13    Liabilities to banks

 

     September 30,
2005


   December 31,
2004


     € mn    € mn

Payable on demand

   16,775    14,003

Repurchase agreements and collateral received from securities lending transactions

   51,262    78,675

Term deposits and certificates of deposit

   77,339    96,736

Other

   2,622    1,933
    
  

Total

   147,998    191,347
    
  

 

14    Liabilities to customers

 

    

September 30,

2005


  

December 31,

2004


     € mn    € mn

Savings deposits

   2,313    2,410

Home loan savings deposits

   3,292    3,214

Payable on demand

   53,336    50,946

Repurchase agreements and collateral received from securities lending transactions

   43,900    49,276

Term deposits and certificates of deposit

   55,130    49,124

Other

   1,936    2,167
    
  

Total

   159,907    157,137
    
  

 

15    Certificated liabilities

 

    

September 30,

2005


  

December 31,

2004


     € mn    € mn

Allianz AG*)

         

Senior bonds

   4,776    5,741

Exchangeable bonds

   2,316    2,742

Money market securities

   1,202    1,428
    
  

Subtotal

   8,294    9,911
    
  

Banking subsidiaries

         

Certificated liabilities

   25,705    25,140

Money market securities

   23,831    21,693
    
  

Subtotal

   49,536    46,833
    
  

All other subsidiaries

         

Certificated liabilities

   415    458

Money market securities

   400    550
    
  

Subtotal

   815    1,008
    
  

Total

   58,645    57,752
    
  

*) Includes senior bonds, exchangeable bonds and money market securities issued by Allianz Finance B.V., Allianz Finance II B.V. and Allianz Finance Corporation and guaranteed by Allianz AG.

 

On February 18, 2005, the Allianz Group issued a senior exchangeable bond, Basket Index Tracking Equity Linked Securities (“BITES”), with a principal amount of € 1,262 mn. The redemption value of the BITES is linked to the performance of the DAX Index. The BITES were issued at a DAX reference level of 4,205.115. The Allianz Group will redeem the BITES with shares of BMW AG, Munich Re and/or Siemens AG. The BITES have a term of 3 years, however, the Allianz Group has the right to redeem the BITES at anytime during their term. The holders of the BITES have the right to exchange the BITES during their term at the redemption value. An outperfomance premium is paid annually equal to 0.75% of the average DAX Index during the reference period prior to the payment date. Upon redemption of the BITES by the Allianz Group or at maturity, the holders of the BITES receive a redemption premium of 1.75% of the redemption

 

F-27


Table of Contents

Allianz Group

 

Notes to the Consolidated Financial Statements—(Continued)

 

as of September 30, 2005 and December 31, 2004 and for the three months and nine months ended September 30, 2005 and 2004

 

value. The Allianz Group has recorded an embedded derivative related to this transaction in financial liabilities carried at fair value through income of € 253 mn as of September 30, 2005.

 

On March 23, 2005, the Allianz Group repaid in cash a senior exchangeable bond with a face amount of € 1,700 mn.

 

On August 26, 2005, the Allianz Group repaid a senior bond with a face amount of CHF 1,500 mn.

 

16    Financial liabilities carried at fair value through income

 

     September 30,
2005


   December 31,
2004


     € mn    € mn

Financial liabilities held for trading

   87,084    102,141

Financial liabilities for unit linked contracts

   51,663    41,409

Liabilities for puttable equity instruments

   2,112    1,386

Financial liabilities designated at fair value through income

   226    201
    
  

Total

   141,085    145,137
    
  

 

Financial liabilities held for trading are comprised of the following:

 

     September 30,
2005


   December 31,
2004


     € mn    € mn

Obligations to deliver securities

   55,310    72,804

Derivative financial instruments

   23,357    23,018

Other trading liabilities

   8,417    6,319
    
  

Total

   87,084    102,141
    
  

 

17    Other accrued liabilities

 

     September 30,
2005


   December 31,
2004


     € mn    € mn

Reserves for pensions and similar obligations

   5,788    5,738

Accrued taxes

   1,440    1,408

Miscellaneous accrued liabilities

   6,569    6,838
    
  

Total

   13,797    13,984
    
  

 

Of the accrued taxes, € 1,304 mn (2004: € 1,278 mn) is attributed to taxes on income.

 

18    Other liabilities

 

     September 30,
2005


   December 31,
2004


     € mn    € mn

Funds held under reinsurance business ceded

   7,541    8,706

Accounts payable on direct insurance business

   7,233    8,199

Accounts payable on reinsurance business

   1,649    1,694

Other liabilities

   12,731    12,672
    
  

Total

   29,154    31,271
    
  

 

F-28


Table of Contents

Allianz Group

 

Notes to the Consolidated Financial Statements—(Continued)

 

as of September 30, 2005 and December 31, 2004 and for the three months and nine months ended September 30, 2005 and 2004

 

Supplementary Information to the Consolidated Income Statements

 

19    Premiums earned (net)

 

Three months ended September 30,


   Property-Casualty

    Life/Health

    Total

 
   Segment

    Consolidation
adjustments


    Group*)

    Segment

    Consolidation
adjustments


    Group*)

    Group*)

 
     € mn     € mn     € mn     € mn     € mn     € mn     € mn  

2005

                                          

Premiums written

                                          

Direct

   9,357     —       9,357     4,447     —       4,447     13,804  

Assumed

   1,115     (58 )   1,057     61     —       61     1,118  
    

 

 

 

 

 

 

Subtotal

   10,472     (58 )   10,414     4,508     —       4,508     14,922  

Ceded

   (1,493 )   —       (1,493 )   (258 )   58     (200 )   (1,693 )
    

 

 

 

 

 

 

Net

   8,979     (58 )   8,921     4,250     58     4,308     13,229  
    

 

 

 

 

 

 

Premiums earned

                                          

Direct

   10,285     —       10,285     4,406     —       4,406     14,691  

Assumed

   1,116     (59 )   1,057     59     —       59     1,116  
    

 

 

 

 

 

 

Subtotal

   11,401     (59 )   11,342     4,465     —       4,465     15,807  

Ceded

   (1,613 )   —       (1,613 )   (259 )   59     (200 )   (1,813 )
    

 

 

 

 

 

 

Net

   9,788     (59 )   9,729     4,206     59     4,265     13,994  
    

 

 

 

 

 

 

2004

                                          

Premiums written

                                          

Direct

   9,351     —       9,351     4,391     —       4,391     13,742  

Assumed

   1,081     (207 )   874     74     (7 )   67     941  
    

 

 

 

 

 

 

Subtotal

   10,432     (207 )   10,225     4,465     (7 )   4,458     14,683  

Ceded

   (1,323 )   7     (1,316 )   (462 )   207     (255 )   (1,571 )
    

 

 

 

 

 

 

Net

   9,109     (200 )   8,909     4,003     200     4,203     13,112  
    

 

 

 

 

 

 

Premiums earned

                                          

Direct

   10,273     —       10,273     4,380     —       4,380     14,653  

Assumed

   1,084     (207 )   877     74     (5 )   69     946  
    

 

 

 

 

 

 

Subtotal

   11,357     (207 )   11,150     4,454     (5 )   4,449     15,599  

Ceded

   (1,517 )   5     (1,512 )   (464 )   207     (257 )   (1,769 )
    

 

 

 

 

 

 

Net

   9,840     (202 )   9,638     3,990     202     4,192     13,830  
    

 

 

 

 

 

 


*) After elimination of intra-Allianz Group transactions between segments.

 

F-29


Table of Contents

Allianz Group

 

Notes to the Consolidated Financial Statements—(Continued)

 

as of September 30, 2005 and December 31, 2004 and for the three months and nine months ended September 30, 2005 and 2004

 

Nine months ended September 30,


   Property-Casualty

    Life/Health

    Total

 
   Segment

    Consolidation
adjustments


    Group*)

    Segment

    Consolidation
adjustments


    Group*)

    Group*)

 
     € mn     € mn     € mn     € mn     € mn     € mn     € mn  

2005

                                          

Premiums written

                                          

Direct

   31,656     —       31,656     14,467     —       14,467     46,123  

Assumed

   2,783     (171 )   2,612     176     (1 )   175     2,787  
    

 

 

 

 

 

 

Subtotal