STRENGTH
CONTINUITY
CHANGE
Allianz SE
Annual Report 2016
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CONTENT
To Our Investors
Supervisory Board Report
A
2
7 Mandates of the Members of the Supervisory Board
8 Mandates of the Members of the Board of Management
B
10
14
16
18
19
27
32
34
45
Management Report of Allianz SE
Executive Summary and Outlook
Operations by Reinsurance Lines of Business
Balance Sheet Review
Liquidity and Funding Resources
Risk and Opportunity Report
Corporate Governance Report
Statement on Corporate Management pursuant to
§ 289a of the HGB
Remuneration Report
Other Information
Pages 1 - 8
Pages 9 - 48
C
Financial Statements of Allianz SE
Pages 49 - 76
FINANCIAL STATEMENTS
Balance Sheets
50
Income Statement
52
NOTES TO THE FINANCIAL STATEMENTS
53
53
56
59
65
68
71
Nature of Operations and Basis of Preparation
Accounting, Valuation and Calculation Methods
Supplementary Information on Assets
Supplementary Information on Equity and Liabilities
Supplementary Information on the Income Statement
Other Information
List of Participations of Allianz SE, Munich as of 31 December 2016
according to § 285 No. 11 HGB in conjunction with § 286 (3) No. 1 HGB
FURTHER INFORMATION
75
76
Responsibility Statement
Auditor's Report
TO OUR INVESTORS
Annual Report 2016
Allianz SE
1
ATO OUR INVESTORS A
To Our Investors
Supervisory Board Report
Ladies and Gentlemen,
During the fiscal year 2016, the Supervisory Board fulfilled all its duties and obligations as laid
out in the company Statutes and applicable law. It monitored the management of the company,
devoted particular attention to personnel matters related to the Board of Management, and
advised the Board of Management regarding the conduct of business.
OVERVIEW
In all of the Supervisory Board’s 2016 meetings, the Board of Management reported on Group
revenues and results as well as developments in individual business segments. The Board
of Management informed us on the course of business as well as on the development of the
Allianz Group and Allianz SE, including deviations in actual business developments from
the planning. Within the framework of our activities, the Board of Management reported to us
on a regular basis and in a timely and comprehensive manner, both verbally and in writing.
Key reporting issues were strategic topics, such as the implementation of the Renewal Agenda
and the portfolio strategy, the risk strategy and capital management, the ongoing challenges
facing the life insurance business due to the low interest rates, the divestment of the life insur-
ance business in South Korea, as well as the business development in the Asset Management
segment. In addition, we were extensively involved in the Board of Management’s planning for
both the fiscal year 2017 and the three-year period from 2017 to 2019. We dealt extensively with
the implementation of the audit reform legislation, in particular the preparation of the audit
firm rotation. Finally, we prepared for the election of the Supervisory Board in spring 2017 and
also took a look at the result of the review of the efficiency of the Supervisory Board’s activities
carried out with the support of an external advisor.
In the fiscal year 2016, the Supervisory Board held six meetings. The meetings took place in
February, March, May, August, October and December. The Board of Management’s verbal reports
at the meetings were accompanied by written documents, which were sent to each member of
the Supervisory Board in time for the relevant meeting. The Board of Management also informed
us in writing of important events that occurred between meetings. The chairmen of the Super-
visory and Management Boards also had regular discussions about major developments and
decisions.
Details on each member’s participation at meetings of the Supervisory Board and its committees
can be found in the Corporate Governance Report, starting on
visory Board who were unable to attend meetings of the Supervisory Board or its committees were
excused and, as a rule, cast their votes in writing.
page 27. Members of the Super-
ISSUES DISCUSSED IN THE SUPERVISORY BOARD PLENARY SESSIONS
In the meeting of 18 February 2016, the Supervisory Board dealt comprehensively with the pro-
visional financial figures for the fiscal year 2015 and the Board of Management’s recommended
dividend. The appointed audit firm, KPMG AG Wirtschaftsprüfungsgesellschaft (KPMG), Munich,
reported in detail on the provisional results of their audit. The Chief Compliance Officer then
gave his annual report on the compliance organization and key compliance-related matters.
During the further course of the meeting, the Supervisory Board also reviewed the extent to
which individual members of the Board of Management had achieved their targets and set
their variable remuneration for the fiscal year 2015 as well as the mid-term bonus for the fiscal
years 2013 – 2015. In the course of the performance assessment, we also verified the fitness and
propriety of the members of the Board of Management.
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Annual Report 2016
Allianz SE
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To Our Investors
In the meeting of 10 March 2016, the Supervisory Board dealt, firstly with personnel matters and
appointed Ms. Jacqueline Hunt to the Board of Management as successor to Mr. Jay Ralph with
effect from 1 July 2016, and Dr. Günther Thallinger as successor to Dr. Maximilian Zimmerer with
effect from 1 January 2017. The Supervisory Board also discussed the audited annual Allianz SE
and consolidated financial statements as well as the recommendation for the appropriation
of earnings by the Board of Management for the fiscal year 2015. The auditor confirmed that
there were no discrepancies to their February report, and issued an unqualified auditor’s report
for the individual and consolidated financial statements. In addition, the Board of Management
sub mitted its report on risk developments in 2015. The Supervisory Board also dealt with the
agenda and the proposals for resolution for the 2016 AGM of Allianz SE. It also resolved to appoint
KPMG as auditor for the individual and consolidated financial statements for the fiscal year 2016
and for the auditor’s review of the 2016 half-yearly financial report. In addition, the Supervisory
Board was also informed about the implementation status of the Renewal Agenda and the con-
sideration of environmental, social, and governance (ESG) aspects in the investment and under-
writing process.
On 4 May 2016, just before the AGM, the Board of Management briefed us on the first quarter 2016
performance and on the Group’s current situation, in particular the capital adequacy, the
solvency ratio, and the planned sale of the life insurance business in South Korea. Because of
Ms. Ira Gloe-Semler’s and Mr. Peter Denis Sutherland’s resignation from the Supervisory Board,
a by-election for the committees had to be held. Ms. Martina Grundler was elected to the Audit
Committee, Dr. Friedrich Eichiner to the Risk Committee, and Mr. Jim Hagemann Snabe to the
Nomination Committee.
In the meeting of 4 August 2016, the Board of Management reported in depth on the half-yearly
results and also dealt with the potential impact of Brexit as well as the failed coup attempt in
Turkey, the situation in the Italian banking sector, the acquisition in Morocco, and planned issu-
ance of shares to employees. We then dealt extensively with the implementation status of the
Renewal Agenda, in particular in the main operating entities, regarding the topics True Customer
Centricity, Digital by Default, Technical Excellence, Growth Engines, and Inclusive Meritocracy.
The Board of Management also reported on the measures to promote women and to increase
employee mobility. Finally, the Supervisory Board dealt with the audit reform legislation and the
therefore required adjustments to the rules of procedure for the Supervisory Board and indi-
vidual committees, as well as the objectives for the composition of the Super visory Board. The
meeting was preceded by a separate informational event for the members of the Supervisory
Board on the Group’s digital strategy and its implementation.
The main focus of the meeting on 7 October 2016 was the strategy of the Allianz Group, in parti-
cular the portfolio strategy and its integration into the Renewal Agenda, the risk strategy, and
capital management. In addition, the Supervisory Board dealt with the Group’s ambitions in the
health insurance business. In its report on the results, the Board of Management also addressed
the divestment process for Oldenburgische Landesbank AG. Other topics discussed in the
meeting included amendments to the schedule of responsibilities of the Board of Management
as well as the report of the Nomination Committee in the plenary session on the proposed
candidates for election to the Supervisory Board as shareholder representatives by the 2017 AGM.
At the 15 December 2016 meeting, the Board of Management provided us with information about
the third-quarter results and further business developments as well as the current situation of
the Allianz Group. It also briefed us on the status of the divestment process in South Korea and
on the settlement of a SEC investigation at PIMCO. We also discussed the planning for the fiscal
year 2017 and the 2017 – 2019 three-year period, as well as the Declaration of Conformity with
the German Corporate Governance Code. The Supervisory Board reviewed the appropriateness
of the remuneration of the Board of Management based on a vertical and horizontal comparison,
Annual Report 2016
Allianz SE
3
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To Our Investors
set targets for the variable remuneration of the members of the Board of Management and dis-
cussed general succession planning with regard to the Board of Management. The new CEO of
PIMCO also introduced himself with initial considerations regarding the future direction of PIMCO.
Furthermore, we dealt extensively with the proposal made by the Audit Committee regarding
the mandatory audit firm rotation. In addition, the Supervisory Board nominated the candidates
for the 2017 Supervisory Board election in accordance with the proposal made by the Nomination
Committee and considering the objectives for the composition of the Supervisory Board. The
new regulatory requirements regarding the composition of the Supervisory Board were also
discussed in this context. Finally, we took a detailed look at the results of the Supervisory Board’s
efficiency review carried out with the support of an external advisor.
DECLARATION OF CONFORMITY WITH THE GERMAN CORPORATE GOVERNANCE CODE
On 15 December 2016, the Board of Management and the Supervisory Board issued the Declara-
tion of Conformity in accordance with § 161 of the German Stock Corporation Act (“Aktien-
gesetz”). The Declaration was posted on the company website, where it is available to share-
holders at all times. Allianz SE fully complies and will continue to fully comply with the
recom mendations of the German Corporate Governance Code made in the Code’s version of
5 May 2015.
Further explanations on corporate governance in the Allianz Group can be found in the Corpo-
rate Governance Report starting on
pursuant to § 289a of the HGB starting on
details on corporate governance:
page 27 and the Statement on Corporate Management
page 32. The Allianz website also provides more
www.allianz.com/corporate-governance.
COMMITTEE ACTIVITIES
The Supervisory Board has formed various committees in order to perform its duties efficiently.
The committees prepare the discussion and adoption of resolutions in the plenary sessions or
can adopt resolutions themselves.
The Standing Committee held two meetings and adopted one resolution by written procedure
in 2016. These related primarily to corporate governance issues, in particular to the adjustments
to the rules of procedure for the Supervisory Board and its committees as a result of the new
auditing legislation, the preparation for the AGM, the Employee Stock Purchase Plan, and the
external review of the Supervisory Board’s efficiency. During the fiscal year the committee also
passed resolutions to approve loans to senior executives.
The Personnel Committee held three meetings, one of which was by conference call, in 2016.
It dealt extensively with the successors to Mr. Ralph and Dr. Zimmerer. The committee also
looked at other mandate matters for active and former members of the Board of Management.
In addition to reviewing the target achievement among Board of Management members for
2015, the committee prepared the review of the remuneration system and the setting of targets
for variable remuneration for 2017.
The Audit Committee held five regular and two extraordinary meetings, and adopted one reso-
lution by written procedure in 2016. In the presence of the auditors, it discussed the annual
financial statements of Allianz SE and the consolidated financial statements of the Allianz Group,
the management reports and auditor’s reports as well as the half-yearly financial report. The
Audit Committee saw no reason to raise any objections. In addition, the Board of Management
submitted its report on the results of the first and third quarter. The committee also dealt with
the auditor’s engagement and established priorities for the annual audit for the 2016 financial
year. It also discussed assignments to the auditors for non-audit services. In addition, it dealt
extensively with the compliance system, the internal audit system as well as the internal finan-
cial reporting process and the internal controls over financial reporting. The committee received
4
Annual Report 2016
Allianz SE
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To Our Investors
regular reports on legal and compliance issues and the work of the internal audit function and
initiated a review of the group-wide implementation status of the governance requirements
according to Solvency II. The preparations for the audit firm rotation from the fiscal year 2018 were
one of the main areas of focus of the Audit Committee’s work. A tender procedure in accordance
with the new legal requirements was carried out for this purpose and a recommendation finally
submitted to the plenary session.
The Risk Committee held two meetings in 2016, during which it discussed the current risk situation
of the Allianz Group with the Board of Management. The risk report and other risk-related state-
ments in the annual Allianz SE and consolidated financial statements as well as management
and group management reports were reviewed with the auditor and the Audit Committee was
informed of the result. The appropriateness of the early risk recognition system at Allianz and
the result of further, voluntary risk assessments by the auditor were also discussed. The com-
mittee took a detailed look at the risk strategy and capital management, as well as the effective-
ness of the risk management system, in particular the limit system for the Allianz Group and
Allianz SE. The interest rate sensitivity in the life insurance business and measures to reduce
it were also dealt with in detail. Other matters considered were the risk strategy of Allianz SE
and of the Allianz Group, the risk categories “operational risk” and “credit risk”, the effects of
the prevailing low-interest environment, and the rules for Global Systematically Important
Insurers (G-SII).
The Nomination Committee held four meetings, two of which by conference call in 2016, in
which it dealt comprehensively with the proposals made by the shareholders for the election of
the Supervisory Board by the 2017 AGM.
The Supervisory Board was regularly and comprehensively informed of the committees’ work.
CHAIR AND COMMITTEES OF THE SUPERVISORY BOARD – as of 31 December 2016
Chairman: Dr. Helmut Perlet
Vice Chairmen: Dr. Wulf H. Bernotat, Rolf Zimmermann
Standing Committee: Dr. Helmut Perlet (Chairman), Dr. Wulf H. Bernotat,
Gabriele Burkhardt-Berg, Prof. Dr. Renate Köcher, Rolf Zimmermann
Personnel Committee: Dr. Helmut Perlet (Chairman), Christine Bosse, Rolf Zimmermann
Audit Committee: Dr. Wulf H. Bernotat (Chairman), Jean-Jacques Cette, Martina Grundler,
Dr. Helmut Perlet, Jim Hagemann Snabe
Risk Committee: Dr. Helmut Perlet (Chairman), Dante Barban, Christine Bosse,
Dr. Friedrich Eichiner, Jürgen Lawrenz
Nomination Committee: Dr. Helmut Perlet (Chairman), Prof. Dr. Renate Köcher,
Jim Hagemann Snabe
AUDIT OF ANNUAL ACCOUNTS AND CONSOLIDATED FINANCIAL STATEMENTS
In compliance with the special legal provisions applying to insurance companies, the statutory
auditor and the auditor for the review of the half-yearly financial report are appointed by the
Supervisory Board of Allianz SE not the AGM. The Supervisory Board has appointed KPMG as statu-
tory auditor for the annual Allianz SE and consolidated financial statements, as well as for the
review of the half-yearly financial report of the fiscal year 2016. KPMG audited the financial state-
ments of Allianz SE and the Allianz Group as well as the respective management reports. They
issued an auditor’s report without any reservations. The consolidated financial statements were
prepared on the basis of the International Financial Reporting Standards (IFRS), as adopted in
the European Union. KPMG performed a review of the half-yearly financial report. The third-quar-
ter results were subject to a voluntary review by KPMG. In addition, KPMG was also mandated to
per form an audit of the market value balance sheet according to Solvency II.
Annual Report 2016
Allianz SE
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To Our Investors
All Supervisory Board members received the documentation relating to the annual financial state-
ments and the auditor’s reports from KPMG on schedule. The provisional financial statements
and KPMG’s audit results were discussed in the Audit Committee on 15 February 2017 and in the
plenary session of the Supervisory Board on 16 February 2017. The final financial statements
and KPMG’s audit reports were reviewed on 9 March 2017 by the Audit Committee and in the
Supervisory Board plenary session. The auditors participated in these discussions and pre-
sented the main results from the audit. No material weaknesses in the internal financial report-
ing control process were discovered. There were no circumstances that might give cause for
concern about the auditor’s independence. In addition, the market-value balance sheet as of
31 December 2016 as well as the relevant KPMG report, were addressed by the Audit Committee
and Supervisory Board.
On the basis of our own reviews of the annual Allianz SE and consolidated financial statements,
the management and group management reports and the recommendation for appropriation
of earnings, we raised no objections and agreed with the results of the KPMG audit. We approved
the Allianz SE and consolidated financial statements prepared by the Board of Management.
We agree with the Board of Management’s proposal on the appropriation of earnings.
The Supervisory Board would like to thank all Allianz Group employees for their great personal
commitment over the past year.
MEMBERS OF THE SUPERVISORY BOARD AND BOARD OF MANAGEMENT
Ms. Ira Gloe-Semler resigned from her office of employee representative on the Supervisory
Board effective 31 March 2016, due to her change of function with the union ver.di. The SE Works
Council appointed Ms. Martina Grundler, also a representative of the union ver.di, as her successor.
Mr. Peter Denis Sutherland stepped down from the Supervisory Board following the AGM on
4 May 2016, having reached retirement age. Dr. Friedrich Eichiner was elected to the Supervisory
Board as his successor by the AGM.
As already mentioned, the 2016 financial year also saw personnel changes within Allianz SE’s
Board of Management. Mr. Jay Ralph and Dr. Maximilian Zimmerer stepped down from the Board
of Management with effect from 30 June 2016 and 31 December 2016, respectively. Ms. Jacqueline
Hunt was appointed as successor to Mr. Ralph with effect from 1 July 2016. Dr. Zimmerer was
replaced by Dr. Günther Thallinger with effect from 1 January 2017.
Munich, 9 March 2017
For the Supervisory Board:
Dr. Helmut Perlet
Chairman
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Annual Report 2016
Allianz SE
Mandates of the Members
of the Supervisory Board
A
To Our Investors
DR. HELMUT PERLET
Chairman
Member of various Supervisory Boards
Membership in other statutory supervisory boards
and SE administrative boards in Germany
Commerzbank AG
GEA Group AG (Chairman since 20 April 2016)
DR. WULF H. BERNOTAT
Vice Chairman
Member of various Supervisory Boards
Membership in other statutory supervisory boards
and SE administrative boards in Germany
Bertelsmann Management SE
Bertelsmann SE & Co. KGaA
Deutsche Telekom AG
Vonovia SE (Chairman)
ROLF ZIMMERMANN
Vice Chairman
Chairman of the (European) SE Works Council
of Allianz SE
DANTE BARBAN
Employee of Allianz S.p.A.
CHRISTINE BOSSE
Member of various Supervisory Boards
Membership in comparable1 supervisory bodies
P/F BankNordik (Chairwoman)
TDC A/S
GABRIELE BURKHARDT-BERG
Chairwoman of the Group Works Council of Allianz SE
Membership in other statutory supervisory boards
and SE administrative boards in Germany
Allianz Deutschland AG
since 1 September 2016
JÜRGEN LAWRENZ
Employee of Allianz Managed Operations & Services SE
Membership in other statutory supervisory boards
and SE administrative boards in Germany
Membership in Group bodies
Allianz Managed Operations & Services SE
JIM HAGEMANN SNABE
Member of various Supervisory Boards
Membership in other statutory supervisory boards
and SE administrative boards in Germany
SAP SE
Siemens AG
Membership in comparable1 supervisory bodies
A.P. Møller-Mærsk A/S
since 12 April 2016
Bang & Olufsen A/S
Danske Bank A/S
until 17 March 2016
PETER DENIS SUTHERLAND
until 4 May 2016
Member of various Supervisory Boards
Membership in comparable1 supervisory bodies
BW Group Ltd.
Koç Holding A.Ş.
JEAN-JACQUES CETTE
Chairman of the Group Works Council
of Allianz France S.A.
Membership in comparable1 supervisory bodies
Membership in Group bodies
Allianz France S.A.
DR. FRIEDRICH EICHINER
since 4 May 2016
Member of various Supervisory Boards
Membership in other statutory supervisory boards
and SE administrative boards in Germany
Festo AG
Membership in comparable1 supervisory bodies
Festo Management AG
IRA GLOE-SEMLER
until 1 April 2016
Regional Representative Financial Services
of ver.di Hamburg
MARTINA GRUNDLER
since 1 April 2016
National Representative Insurances, ver.di Berlin
PROF. DR. RENATE KÖCHER
Head of “Institut für Demoskopie Allensbach”
(Allensbach Institute)
Membership in other statutory supervisory boards
and SE administrative boards in Germany
BMW AG
Infineon Technologies AG
Nestlé Deutschland AG
Robert Bosch GmbH
1
Generally, we regard memberships in other supervisory bodies as “comparable” if the company is listed on a stock exchange or has more than 500 employees.
Annual Report 2016
Allianz SE
7
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To Our Investors
Mandates of the Members
of the Board of Management
OLIVER BÄTE
Chairman of the Board of Management
Membership in other statutory supervisory boards
and SE administrative boards in Germany
Membership in Group bodies
Allianz Deutschland AG
Membership in comparable1 supervisory bodies
Membership in Group bodies
Allianz France S.A.
until 5 May 2016
DR. CHRISTOF MASCHER
Operations, Allianz Worldwide Partners
Membership in other statutory supervisory boards
and SE administrative boards in Germany
Volkswagen Autoversicherung AG
Membership in Group bodies
Allianz Managed Operations & Services SE (Chairman)
Membership in comparable1 supervisory bodies
Membership in Group bodies
Allianz Worldwide Partners S.A.S.
DR. DIETER WEMMER
Finance, Controlling, Risk
Membership in other statutory supervisory boards
and SE administrative boards in Germany
Membership in Group bodies
Allianz Asset Management AG
Allianz Investment Management SE
Membership in comparable1 supervisory bodies
UBS Group AG
since 10 May 2016
JAY RALPH
until 30 June 2016
Asset Management, US Life Insurance
Membership in comparable1 supervisory bodies
Membership in Group bodies
Allianz Life Insurance Company of North America
(Chairman)
DR. GÜNTHER THALLINGER
since 1 January 2017
Investment Management
Membership in other statutory supervisory boards
and SE administrative boards in Germany
Membership in Group bodies
Allianz Asset Management AG
Allianz Investment Management SE (Chairman)
Membership in comparable1 supervisory bodies
Membership in Group bodies
Allianz S.p.A.
since 22 July 2016
DR. AXEL THEIS
Global Insurance Lines & Anglo Markets
Membership in other statutory supervisory boards
and SE administrative boards in Germany
ProCurand GmbH & KGaA (Chairman)
Membership in Group bodies
Allianz Global Corporate & Specialty SE (Chairman)
Membership in comparable1 supervisory bodies
Membership in Group bodies
Allianz Australia Ltd.
Allianz Insurance plc (Chairman)
Allianz Irish Life Holdings plc
Euler Hermes Group S.A. (Chairman since 25 May 2016)
DR. WERNER ZEDELIUS
Insurance German Speaking Countries and
Central & Eastern Europe
Membership in other statutory supervisory boards
and SE administrative boards in Germany
FC Bayern München AG
Membership in Group bodies
Allianz Deutschland AG (Chairman)
Allianz Investment Management SE
Membership in comparable1 supervisory bodies
Membership in Group bodies
Allianz Elementar Lebensversicherungs-AG (Chairman)
Allianz Elementar Versicherungs-AG (Chairman)
Allianz Investmentbank AG
Allianz Suisse Lebensversicherungs-Gesellschaft AG
Allianz Suisse Versicherungs-Gesellschaft AG
Allianz Tiriac Asigurari S.A.
since 31 January 2017
DR. MAXIMILIAN ZIMMERER
until 31 December 2016
Investments, Global Life/Health
Insurance Asia Pacific
Membership in other statutory supervisory boards
and SE administrative boards in Germany
Membership in Group bodies
Allianz Asset Management AG
Allianz Investment Management SE (Chairman)
Allianz Lebensversicherungs-AG
SERGIO BALBINOT
Insurance Western & Southern Europe
Insurance Middle East, Africa
Asia Pacific
since 1 January 2017
Membership in comparable1 supervisory bodies
Bajaj Allianz General Insurance Co. Ltd.
since 12 January 2016
Bajaj Allianz Life Insurance Co. Ltd.
since 12 January 2016
UniCredit S.p.A.
since 9 June 2016
Membership in Group bodies
Allianz France S.A.
Allianz S.p.A.
until 22 July 2016
Allianz Sigorta A.S.
Allianz Yasam ve Emeklilik A.S.
JACQUELINE HUNT
since 1 July 2016
Asset Management, US Life Insurance
Membership in comparable1 supervisory bodies
Membership in Group bodies
Allianz Life Insurance Company of North America
(Chairwoman)
since 22 July 2016
DR. HELGA JUNG
Insurance Iberia & Latin America, Legal, Compliance,
Mergers & Acquisitions
Membership in other statutory supervisory boards
and SE administrative boards in Germany
Deutsche Telekom AG
since 25 May 2016
Membership in Group bodies
Allianz Asset Management AG (Chairwoman)
Allianz Deutschland AG
since 11 March 2016
Allianz Global Corporate & Specialty SE
Membership in comparable1 supervisory bodies
UniCredit S.p.A.
until 31 May 2016
Membership in Group bodies
Allianz Compañía de Seguros y Reaseguros S.A.
Companhia de Seguros Allianz Portugal S.A.
1
Generally, we regard memberships in other supervisory bodies as “comparable” if the company is listed on a stock exchange or has more than 500 employees.
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Annual Report 2016
Allianz SE
Annual Report 2016
Allianz SE
9
MANAGEMENT REPORT OF ALLIANZ SEB B
Management Report of Allianz se
Executive Summary and Outlook
Earnings summary
CONDENSED INCOME STATEMENT
€ mn
Gross premiums written
Premiums earned (net)
Claims (net)
Underwriting expenses (net)
Other technical reserves (net)
Net underwriting result
Change in claims equalization and
similar reserves
Net technical result
Investment result
Allocated interest return
Other non-technical result
Non-technical result
Net operating income
Taxes
Net income
2016
10,820
9,625
(6,344)
(2,946)
65
400
(528)
(128)
3,290
(22)
(459)
2,809
2,681
267
2,948
2015
8,328
7,183
(4,907)
(2,065)
13
224
(193)
31
6,009
(60)
(2,782)
3,167
3,198
356
3,554
Change
2,492
2,442
(1,437)
(881)
52
176
(335)
(159)
(2,719)
38
2,323
(358)
(517)
(89)
(606)
NET UNDERWRITING RESULT
Gross premiums written increased to € 10,820 MN, mainly due to the
new quota share agreements with European Allianz entities. In total,
€ 10,385 MN (2015: € 7,769 MN) of gross premiums came from Property-
Casualty reinsurance and € 435 MN (2015: € 559 MN) from Life/Health
reinsurance.
The net retention ratio increased to 92.7 % (2015: 90.3 %) due to
optimized retrocession structure. Premiums earned (net) rose by
€ 2,442 MN to € 9,625 MN (2015: € 7,183 MN), mainly driven by the deve-
lopment of gross premiums written and lower retrocessions.
The accident year loss ratio (net) in Property-Casualty reinsu-
rance dropped to 69.9 % (2015: 72.8 %). Natural catastrophe losses
amounted to € 226 MN for the accident year 2016 (2015: € 244 MN). This
represented a negative impact on the accident year loss ratio (net) of
2.4 (2015: 3.6) percentage points.
Natural catastrophes
€ mn
Major Events in 2016
Storms Lea, Marine and Neele, Germany
Earthquake, New Zealand
Storm Elvira, Germany
Storm Friederike, Germany
Hailstorm, Canada
Hailstorm, Netherlands
Earthquake Kumamoto, Japan
Other
Total
Major Events in 2015
Storm Niklas, Germany
New South Wales storms, Australia
Sydney hailstorm, Australia
Storm Thompson, Germany
Storm Siegfried, Germany
Hailstorm Edgar, Germany
Storms Elon and Felix, Germany
Other
Total
Losses for
Allianz SE
40
39
34
27
16
13
10
47
226
Losses for
Allianz SE
63
38
37
21
20
16
15
34
244
The positive run-off result increased substantially from € 324 MN to
€ 427 MN and was mainly influenced by the development of fire rein-
surance (€ 180 MN), engineering reinsurance (€ 99 MN), personal
accident reinsurance (€ 48 MN) and business interruption reinsu rance
(€ 36 MN). In total, there was a decrease of the loss ratio (net) in
Property- Casualty reinsurance to 65.3 % (2015: 68.0 %).
The expense ratio (net) in Property-Casualty reinsurance
increased substantially to 31.0 % (2015: 28.9 %). This was particularly
driven by an increase of 2.3 percentage points in the commission
ratio to 30.1 % (2015: 27.8 %), largely resulting from the new quota share
agreements with European Allianz entities. At the same time, the
administrative expense ratio dropped by 0.2 percentage points to 0.9 %
(2015: 1.1 %).
The net underwriting result almost doubled by 78.7 % from
€ 224 MN to € 400 MN, mainly because of the positive development of
calendar year claims ratio in 2016 and the overall portfolio growth.
NET TECHNICAL RESULT
In 2016, a change in claims equalization and similar reserves of
€ 528 MN (2015: € 193 MN) resulted from the substantial premium
growth as well as the positive underwriting result. The strengthening
was mainly driven by fire reinsurance (€ 183 MN), other reinsurance
lines (€ 122 MN), motor reinsurance (€ 106 MN) and liability reinsu rance
(€ 45 MN).
Driven by the increase of equalization and similar reserves the
net technical result turned negative with € (128) MN (2015: € 31 MN).
10
Annual Report 2016
Allianz SE
NON-TECHNICAL RESULT
INVESTMENT RESULT
€ mn
Investment income
Income from profit transfer
agreements
Income from affiliated enterprises
and participations
Income from other investments
Realized gains
Income from reversal of impairments
Subtotal
Investment Expenses
Expenses for the management
of investments, interest and other
investment-related expenses
Depreciation and impairments
of investments
Realized losses
Expenses for losses taken over
Subtotal
Investment result
2016
2015
Change
1,943
1,727
945
365
105
3,001
(1,058)
3,820
(2,093)
945
361
3
–
4
102
5,085
8,130
(3,045)
(1,106)
(1,122)
(183)
(198)
(308)
(1,795)
3,290
(594)
(184)
(221)
(2,121)
6,009
16
411
(14)
(87)
326
(2,719)
The investment result decreased by € 2,719 MN to € 3,290 MN.
Income from profit transfer agreements declined by € 1,058 MN to
€ 1,943 MN, primarily due to a lower profit transfer from Allianz
Deutschland AG, which went down by € 1,084 MN to € 850 MN. This was
partly offset by higher profit transfers from Allianz Global Corpo-
rate & Specialty SE and from Allianz Asset Management AG, which
slightly rose by € 15 MN to € 700 MN and by € 7 MN to € 381 MN.
Income from affiliated enterprises and participations decreased
by € 2,093MN to € 1,727 MN, mainly because the dividend payment
received from our subsidiary Allianz Europe B.V. was reduced by
€ 2,100 MN to € 1,350 MN in 2016.
Income from other investments remained stable at € 945 MN, par-
ticularly consisting of interest income from intra-group loans
(€ 417 MN) and bonds (€ 386 MN).
Realized gains slightly increased by € 4 MN to € 365 MN, mainly
resulted from the sale of bonds (€ 326 MN).
Income from reversal of impairments went up by € 102 MN to
€ 105 MN and primarily stemmed from write-ups related to our bond
portfolio (€ 98 MN).
Expenses for the management of investments, interest and other
investment-related expenses were further reduced by € 16 MN to
€ 1,106 MN. Despite an overall increase of financial liabilities, interest
expenses went down as a result of lower refinancing rates for the roll-
over of matured debt instruments.
Depreciation and impairments of investments significantly
declined by € 411 MN to € 183 MN. The impairments in 2016 were par-
ticularly attributable to our bond portfolio (€ 118 MN).
Realized losses increased by € 14 MN to € 198 MN, stemming from
the sale of bonds (€ 114 MN) and the sale of our subsidiary Allianz Life
Insurance Company Ltd. Korea (€ 85 MN).
Expenses for losses taken over rose by € 87 MN to € 308 MN. This was
primarily due to higher losses taken over from our service provider
Allianz Managed Operations & Services SE, which increased by € 69 MN
to € 283 MN.
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Management Report of Allianz se
OTHER NON-TECHNICAL RESULT
The other non-technical result improved significantly by € 2,323 MN to
€ (459) MN. This development was primarily driven by a decrease of
interest expenses on pensions to the amount of € 654 MN and on long-
term provisions to the amount of € 166 MN. Furthermore, the renego-
tiation of the pension cost allocation contract with the German sub-
sidiaries, which had negatively affected the result by € (228) MN in the
previous year, had a positive impact of € 148 MN in the fiscal year 2016.
The release of pension provisions to the amount of € 143 MN, due to
the reduction of the assumed pension trend, also led to an increase
of the result. In addition, the improved currency result influenced the
positive development by € 600 MN, the improved result on derivatives
by € 340 MN. For further information regarding other income and
expenses please refer to note 23.
TAXES AND NET INCOME
As far as legally permissible, Allianz SE acts as the controlling company
(“Organträger”) of the German tax group most German sub sidiaries
belong to. As the controlling company, Allianz SE is liable for the
income taxes of this German tax group.
After being offset against tax losses, the current tax charge of
Allianz SE amounted to € 257 MN (2015: € 306 MN). Moreover, Allianz SE
received a tax allocation of € 523 MN (2015: € 664 MN) by Allianz SE tax
group companies that recorded taxable income. Taking into account
other taxes, the tax income amounted to € 267 MN (2015: € 356 MN).
The decrease of the net income by € 606 MN to € 2,948 MN (2015:
€ 3,554 MN) is primarily driven by the significant drop of the investment
result by € 2,719 MN to € 3,290 MN. This was partly offset by the rise of
the other non-technical result by € 2,323 MN to € (459) MN.
Economic outlook1
Following a slight acceleration in the final quarter of 2016, the world
economy currently finds itself in fairly good shape and has made a
positive start into the year 2017. In the industrialized countries,
growth prospects are quite favorable overall. In the United States,
despite the fact that there is still not much clarity about the specifics
of economic policy under the new U.S. administration, a change in the
policy mix is on the horizon: Monetary policy will provide somewhat
less stimulus for the economic development, whereas fiscal policy
will do more as the new U.S. administration is expected to deliver on
the promise to cut taxes and launch investment initiatives. In the
course of 2017, these measures are expected to buoy economic
growth, despite some dampening effects such as higher inflation. All
in all, the U.S. economy is likely to expand by 2.2 % this year. In the
Eurozone, the economic recovery is likely to continue. We expect real
gross domestic product to increase by 1.8 % (2016: 1.7 %). While the
upward movement in oil prices and rising inflation will weigh on pri-
vate consumption, household spending will be supported by rising
employment. The group of emerging market economies is set for a
moderate acceleration of growth, mainly driven by a gradual stabiliza-
tion in the group’s heavyweights, Russia and Brazil, and by a recovery
in commodity-exporting countries. Overall, global output is likely to
expand by about 2.8 % in 2017, compared with 2.4 % in 2016. Industrial-
ized countries are expected to register gross domestic product
1
The information presented in the sections Economic outlook, Insurance industry outlook and Asset
management industry outlook is based on our own estimates.
Annual Report 2016
Allianz SE
11
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Management Report of Allianz se
growth of 1.9 %, while in emerging markets growth could increase to
4.1 % from the 3.6 % seen in 2016.
The uncertain global economic and political environment (e.g.
rise of populism, high emerging market indebtedness, risk of E.U. dis-
integration) is likely to result in higher financial-market volatility this
year. As far as monetary policy is concerned, assuming that the labor
market remains tight and inflation rates continue to move up, the
Federal Reserve is likely to continue to hike interest rates this year. By
contrast, we do not see any major change in the European Central
Bank’s expansionary monetary policy stance.
Modestly rising yields on 10-year U.S. government bonds and
higher inflation rates in the Eurozone will exert some upward pressure
on European benchmark bond yields in 2017. However, with short-
term rates at zero, there are limited prospects of markedly higher
yields on longer-term bonds. For 10-year German government bonds,
we predict yields to climb modestly towards 1 % in the course of 2017;
for 10-year U.S. government bonds, yields may end the year in a range
between 2.5 % and 3 %. While the expected Federal Reserve rate hikes
will weigh on the Euro, a number of other factors will support it;
above all, the expected rise in the U.S. current-account deficit as well
as the speculation – which is likely to increase towards year-end –
about the timing and manner of the European Central Bank’s exit
from its bond purchasing program. We expect the Dollar-to-Euro
exchange rate to close the year at about 1.10 (2016: 1.05).
Insurance industry outlook
In 2017, things are likely to start moving in the right direction for the
insurance industry: The global economy is set to shift up a gear, infla-
tion will return – which will set the scene for monetary normalization
– and last but not least, interest rates are expected to rise. That said,
the overall momentum will probably be too weak to finally escape the
low-growth, low-yield environment; so, for the time being, we expect
premium growth to remain modest and investment income to
remain under pressure. Moreover, political risks could easily derail
the economy and knock markets from their path to normalization.
While the macroeconomic environment, despite all the uncer-
tainties, offers some glimpses of hope, the challenges on the micro-
economic front remain formidable: As technological progress and
the digitization of our life gather speed, established business models
get under enormous pressure. The industry has to adapt quickly to
defend its franchise against new competitors. In combination with
the new regulatory regime (Solvency II), which brings more clarity on
capital positions, this restructuring process could act as a possible
catalyst for more industry consolidation.
To sum up: In 2017, the industry’s top line will continue to grow
modestly – though some lines of business such as trade-dependent
marine and rate-sensitive savings might struggle – while the bottom
line remains under pressure from weak investment income and the
need to build new, digital business models.
In the property-casualty sector, growth in advanced markets
should remain rather stable: The ongoing recovery supports demand,
but pricing is still a concern. For advanced markets, political insta-
bility could prove to be the biggest challenge in 2017, as growing pro-
tectionism and the looming Brexit drive structural changes in the
industry. The outlook for emerging markets is much brighter: Asia is
expected to roar ahead, Latin America will stabilize, and Eastern
Europe will continue its recovery. Overall, we expect global premium
revenue growth to range between 4.0 % and 5.0 % in 2017 (in nominal
terms, adjusted for foreign currency translation effects). Given the
still challenging pricing outlook and weak investment income, overall
profitability might not improve but stay more or less flat.
In the life sector the overall picture is quite similar. Specifically,
we expect advanced markets to maintain their (modest) growth as
demand benefits from rising employment and new product offers.
Emerging markets, on the other hand, will show stronger perfor-
mance. Asia might shift down a little after the extraordinary growth
spurt seen in 2016; on a general note, however, rising incomes, urban-
ization, and social security reforms should remain strong engines for
growing insurance demand. All in all, we expect global premium
revenue to increase by 4.0 % to 5.0 % in 2017 (in nominal terms, adjusted
for foreign currency translation effects). To safeguard profitability,
insurers will continue to review both their product mixes and their
investment portfolios. As a result, overall profitability should not
deteriorate any further.
Business outlook
Our outlook assumes no significant deviations from the following
underlying assumptions:
− Global economic growth is set to continue.
− Modest rise in interest rates expected.
− No major disruptions of capital markets.
− No disruptive fiscal or regulatory interference.
− Level of claims from natural catastrophes at expected average
levels.
− Average U.S. Dollar to Euro exchange rate of 1.11.
Allianz SE provides a wide range of reinsurance coverage, primarily
to Allianz insurance entities (group-internal business), but also to
third-party customers (external business). This includes Property-
Casualty as well as Life/Health business on both a proportional and
a non-proportional basis. Due to the broad spread of exposures
underwritten by types of business and geography, Allianz SE’S port-
folio is well diversified.
Allianz SE and its subsidiaries (the Allianz Group) use Allianz SE,
in particular, as a vehicle for actively managing their overall exposure
to natural catastrophes. Within a group-wide risk management
framework, each operating entity is responsible for controlling its
exposure to individual catastrophes and defining its local reinsu-
rance requirements, based on its local risk appetite and capital posi-
tion. The respective cover is then provided by Allianz SE or one of its
subsidiaries. At the Group level, the Allianz SE Board reviews and
approves the risk appetite. The reinsurance division is then respon-
sible for designing and implementing Group catastrophe protections
within given exposure limits. These covers take various forms and
aim to protect the Group against excessive losses from major natural
catastrophes. However, there is still the potential for an unexpected
frequency and/or severity of catastrophic events in any year that may
materially impact the results of Allianz SE. The top five residual risk
exposures at the Group level are summarized on
page 26.
Pricing pressure continued at the January 2017 renewals as the
reinsurance sector absorbed ongoing capital inflows together with
moderate levels of reinsured loss events. Therefore the renewal
results were below the prior year’s level, with prices in the assumed
business further softening and only partially compensated by favor-
able conditions in the outgoing reinsurance.
12
Annual Report 2016
Allianz SE
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Management Report of Allianz se
Allianz SE’S technical result depends largely on group-internal
cessions resulting from the quota share agreements with European
Allianz entities. We expect a slight decrease of net premiums and at
the same time an improvement of the net underwriting result in 2017.
Based on our estimations we expect a slightly decreased combined
ratio for 2017. It should be noted that, in extreme cases, the actual
result may vary significantly as the reinsurance business is, by nature,
volatile in terms of frequency and severity of losses.
For 2017, we predict an increase in net income. Based on our cur-
rent planning, this may involve a year-on-year shift in earning contri-
butions between the investment result and the other non-technical
result. We currently expect a rising investment result. However, as
things stand, this increase will partially be offset by an declined other
non-technical result. We are not currently planning a specific cur-
rency rate result, nor are we able to anticipate any net gains/losses
from derivatives. This could impact the net income of Allianz SE con-
siderably. Given the susceptibility of our non-technical result to
adverse capital market developments, we do not provide a precise
outlook for net income. Nevertheless, we are ultimately planning and
managing the Allianz SE result in line with the dividend policy of the
Allianz Group. To this end, we take advantage of the opportunity to
make targeted use of the dividends of our subsidiaries, in particular
those of Allianz Europe B.V., in order to generate net earnings for
Allianz SE that match the dividend policy of Allianz Group. For more
detailed information on the dividend policy, see the Allianz Group’s
Annual Report 2016 and
www.allianz.com/dividend.
Management’s overall assessment of the
current economic situation of Allianz SE
Overall, at the date of issuance of this Annual Report and given current
information regarding natural catastrophes and capital market
trends – in particular foreign currency, interest rates, and equities –
the Board of Management has no indication that Allianz SE is facing
any major adverse developments.
Cautionary note regarding forward-looking statements
The statements contained herein may include prospects, statements of future expectations, and other forward-looking statements that are based on management’s current views and
assumptions and involve known and unknown risks and uncertainties. Actual results, performance, or events may differ materially from those expressed or implied in such forward-looking
statements.
Such deviations may arise due to, without limitation, (i) changes of the general economic conditions and competitive situation, particularly in the Allianz Group’s core business and core
markets, (ii) performance of financial markets (particularly market volatility, liquidity and credit events), (iii) frequency and severity of insured loss events, including natural catas trophes, and
the development of loss expenses, (iv) mortality and morbidity levels and trends, (v) persistency levels, (vi) particularly in the banking business, the extent of credit defaults, (vii) interest rate
levels, (viii) currency exchange rates, including the Euro/U.S. Dollar exchange rate, (ix) changes in laws and regulations, including tax regulations, (x) the impact of acquisitions, including
related integration issues and reorganization measures, and (xi) general competitive factors, in each case on a local, regional, national, and/or global basis. Many of these factors may be more
likely to occur, or more pronounced, as a result of terrorist activities and their consequences.
No duty to update
The company assumes no obligation to update any information or forward-looking statement contained herein, save for any information required to be disclosed by law.
Annual Report 2016
Allianz SE
13
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Management Report of Allianz se
Operations by Reinsurance Lines of Business
Gross premiums written increased significantly by 29.9 % to € 10,820 MN
(2015: € 8,328 MN). This was mainly due to new quota share agreements
with European Allianz entities that contributed gross pre miums
written of € 2,897 MN. These quota share agreements had substantial
impact on the overall reinsurance portfolio – especially in motor rein-
surance, fire reinsurance and household and homeowners reinsur-
ance. All in all, 92.6 % (2015: 88.5 %) of premiums written originated
from the Allianz Group’s internal business. In addition, Allianz SE
continued to write business from selected external partners in order
to diversify the internal portfolio.
Gross premiums written and net technical result by reinsurance lines of business
Gross premiums written
Combined ratio
Property-Casualty
Change in claims
equalization and
similar reserves
Net technical result
2016
€ mn
4,062
2,817
839
810
441
83
644
2015
€ mn
1,995
2,419
576
506
492
111
734
1,270
1,148
382
357
354
319
237
116
906
402
420
311
427
212
132
862
10,820
8,328
Change
% 1
103.6
16.5
45.7
60.0
(10.3)
(24.9)
(12.3)
10.6
(4.9)
(15.1)
14.0
(25.2)
11.6
(12.5)
5.2
29.9
2016
%
104.1
88.2
88.0
78.2
88.7
87.8
98.8
94.6
93.3
94.8
79.3
n/a
98.3
n/a
96.5
96.3
2015
%
103.7
98.5
90.4
116.9
87.3
95.6
103.5
86.2
91.2
111.6
86.2
n/a
91.1
n/a
92.2
96.9
2016
€ mn
(106)
(183)
–
(183)
–
–
–
(45)
(43)
(27)
(1)
–
(1)
–
(122)
(528)
2015
€ mn
12
44
–
44
–
–
–
(120)
(26)
20
14
–
(18)
–
(119)
(193)
2016
€ mn
(276)
92
95
(59)
48
10
(2)
16
(17)
(9)
68
89
3
1
(95)
(128)
2015
€ mn
(54)
73
54
(13)
49
4
(21)
15
–
(22)
49
33
1
(2)
(62)
31
Motor
Fire and property reinsurance
thereof:
Household and homeowner
Fire
Engineering
Business interruption
Other property reinsurance
Liability
Credit and bond
Marine and aviation
Personal accident
Life
Legal expenses
Health
Other lines
Total
1
For lines of business on the basis of the accurate, non-rounded amount.
Premiums written in motor reinsurance more than doubled to
€ 4,062 MN (2015: € 1,995 MN) due to new quota share agreements with
European Allianz entities. The combined ratio rose to 104.1 % (2015:
103.7 %), mainly driven by the increased expense ratio of 28.8 % (2015:
23.9 %) due to the new quota share agreements with European Allianz
entities. In particular, the premium increase triggered a strengthening
of the equalization reserve of € 106 MN (2015: release of € (12) MN)
The household and homeowner reinsurance portfolio increased
significantly by 45.7 %, with gross premiums written of € 839 MN (2015:
€ 576 MN) mainly coming from the business with Allianz IARD S.A.,
Allianz Versicherungs-AG and AllSecur Deutschland AG.
The fire reinsurance portfolio grew to € 810 MN (2015: € 506 MN) in
gross premiums written mainly driven by internal business. The
combined ratio decreased to 78.2 % (2015: 116.9 %), in particular due to
a positive run-off result of € 180 MN (2015: € 34 MN).
Engineering reinsurance premiums written decreased to € 441 MN
(2015: € 492 MN) mainly coming from the quota share with AGCS
Munich. The combined ratio deteriorated to 88.7 % (2015: 87.3 %),
mainly driven by a higher accident year claims ratio of 80.6 % (2015:
74.9 %) which was partially compensated by the positive run-off result
of € 99 MN (2015: € 77 MN).
Other property reinsurance includes extended coverage for fire
and business interruption as well as hail, storm, water damage, live-
stock, burglary, and glass reinsurance. Premiums written declined by
12.3 % to € 644 MN (2015: € 734 MN) while positive run-off contributed
to the improvement of the combined ratio.
Premiums written for liability reinsurance went up by 10.6 % to
€ 1,270 MN (2015: € 1,148 MN), mainly driven by the new quota share
agreements with European Allianz entities. The combined ratio dete-
riorated to 94.6 % (2015: 86.2 %) mainly influenced by the negative run-
off result of € (33) MN (2015: € 112 MN) and by a 2.2 percentage points
higher expense ratio of 32.5 % (2015: 30.3 %). The premium increase as
well as the positive result triggered a further strengthening of the
equalization reserve of € 45 MN (2015: € 120 MN).
Gross premiums written in credit and bond reinsurance
decreased by € 20 MN to € 382 MN, mainly driven by declined business
with Euler Hermes Reinsurance AG. The combined ratio worsened to
93.3 % (2015: 91.2 %), influenced by a higher expense ratio of 40.0 %
(2015: 33.9 %). A further strengthening of equalization reserve by
€ 43 MN (2015: € 26 MN) led to a negative net technical result of € (17) MN
(2015: € 0 MN).
14
Annual Report 2016
Allianz SE
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Management Report of Allianz se
The premium revenue in marine and aviation reinsurance fell by
15.1 % to € 357 MN (2015: € 420 MN) mainly impacted by a decrease of
premium revenue with AGCS Munich. The combined ratio improved
substantially by 16.8 percentage points to 94.8 %, reflecting a lower
accident year loss ratio of 68.8 % (2015: 94.2 %). This development
caused a strengthening of € 27 MN in equalization reserve (2015:
release of € (20) MN); as a consequence, net technical result stayed
negative with € (9) MN (2015: € (22) MN).
The personal accident reinsurance gross premium revenue
increased to € 354 MN (2015: € 311 MN), mainly driven by higher pre-
miums ceded by Allianz Elementar Versicherungs-Aktiengesellschaft
and Allianz Compañía de Seguros y Reaseguros S.A. The combined
ratio further improved to 79.3 % (2015: 86.2 %), mainly influenced by
higher run-off income of € 48 MN (2015: € 17 MN). After a strengthening
of € 1 MN in equalization reserve (2015: release of € (14) MN) an
increased net technical result of € 68 MN (2015: € 49 MN) was achieved.
In life reinsurance, the premium revenue declined to € 319 MN
(2015: € 427 MN), primarily due to the recapture of a capital manage-
ment transaction in the Asia-Pacific region. The expense ratio
dropped by 9.2 percentage points to 17.8 %. The net technical result
increased to € 89 MN (2015: € 33 MN).
The premium revenue of legal expenses reinsurance rose by
11.6 % to € 237 MN (2015: € 212 MN), largely driven by new quota share
agreement with Allianz Elementar Versicherungs-Aktiengesellschaft.
The combined ratio deteriorated substantially to 98.3 % (2015: 91.1 %).
This was mainly attributable to lower run-off result of € 16 MN (2015:
€ 30 MN) reflected in a higher calendar year losses ratio of 61.8 % (2015:
53.7 %). After a strengthening of equalization reserve with an amount
of € 1 MN (2015: € 18 MN), the net technical result remained positive
with € 3 MN (2015: € 1 MN).
Other reinsurance lines include:
− emergency assistance,
− fidelity & political risk,
− motor extended warranty,
− other property and casualty business.
Annual Report 2016
Allianz SE
15
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Management Report of Allianz SE
Balance Sheet Review
Condensed balance sheet
€ mn
as of 31 December
assets
Intangible assets
Investments
Receivables
Other assets
Deferred charges and prepaid expenses
Total assets
equity and liabilities
Shareholders’ equity
Subordinated liabilities
Insurance reserves net
Other provisions
Funds held with reinsurance business ceded
Payables on reinsurance business
Other financial liabilities
Deferred income
Total equity and liabilities
Investments
€ mn
as of 31 December
Real estate
Investments in affiliated enterprises
and participations
Other investments
Funds held by others under reinsurance
business assumed
Total investments
2016
2015
21
113,079
5,473
292
615
19
107,787
5,290
791
423
119,480
114,310
44,650
13,806
14,471
7,369
1,075
411
37,691
7
119,480
2016
250
71,354
33,447
8,028
113,079
44,978
12,340
13,168
7,500
63
231
36,018
12
114,310
2015
254
73,711
27,727
6,095
107,787
The book value of investments in affiliated enterprises and participa-
tions decreased by € 2.3 BN to € 71.4 BN as a result of a lower book value
of shares in affiliated enterprises (€ 2.3 BN). More details regarding
this position are explained in note 4 to our financial statements.
Other investments went up from € 27.7 BN to € 33.4 BN, primarily
due to higher investments in debt securities (€ 3.7 BN) and loans
(€ 1.2 BN). In addition, a rise in investment funds (€ 0.5 BN) and in
deposits with banks (€ 0.3 BN) also contributed to the overall increase.
At the end of 2016, € 27.4 BN of the total of other investments were
invested in fixed-income securities, of which € 9.5 BN were govern-
ment bonds. We slightly reduced our overall government bond expo-
sure by € 0.1 BN compared to year-end 2015, thereby increasing our
sovereign debt exposure in Spain from € 0.5 BN to € 0.7 BN while
decreasing our investments in Italian government bonds from
€ 0.8 BN to € 0.6 BN.
Funds held by others under reinsurance business assumed
increased to € 8.0 BN (2015: € 6.1 BN) mainly driven by the new quota
share agreements with European Allianz entities.
As of 31 December 2016, the fair value of investments amounted
to € 124.9 BN (2015: € 115.5 BN), compared to a carrying amount of
€ 113.1 BN (2015: € 107.8 BN).
Shareholders’ equity
As of 31 December 2016, our shareholders’ equity amounted to € 44.7 BN
(2015: € 45.0 BN). The net decrease of € 0.3 BN was primarily due to net
income being lower than the dividend paid in 2016.
In the fiscal year 2016, as in the previous year, no capital increase
from authorized capital was performed for the Employee Stock Pur-
chase Plan. Instead, the shares were taken from own shares held. So
the issued capital remained unchanged in the fiscal year.
The Board of Management proposes to use the net earnings of
€ 3,856 MN for dividend payments in the amount of € 3,459 MN. The
unappropriated earnings of € 397 MN will be carried forward.
16
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Allianz se
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Management Report of Allianz SE
DEvElopmEnt of SharEholDErS’ Equity anD of iSSuED SharES
as of 31 December 2015
Own shares
Own shares: realized gains
Dividend payment for 2015
Unappropriated earnings carried forward
Net earnings
as of 31 December 2016
Issued shares
Issued capital
Mathematical
value of
own shares
Additional
paid-in capital
Number
€ tHOu
€ tHOu
€ tHOu
Revenue
reserves
€ tHOu
Net earnings
31 December
€ tHOu
€ tHOu
457,000,000
1,169,920
(5,570)
27,799,741
11,785,174
4,228,626
44,977,891
–
–
–
–
–
–
–
–
–
–
625
–
–
–
–
–
44,923
–
–
–
(1,017)
–
–
–
–
457,000,000
1,169,920
(4,945)
27,844,664
11,784,157
–
–
(392)
44,923
(3,320,374)
(3,320,374)
(908,252)
3,855,866
3,855,866
(908,252)
3,855,866
44,649,662
Insurance reserves and other provisions
For information on insurance reserves and other provisions, please
refer to notes 12 and 13 to our financial statements.
Financial liabilities
Liabilities from bonds issued to Group companies declined to
€ 2.6 BN (2015: € 3.3 BN), due to the redemption of bonds amounting to
€ 0.7 BN.
Liabilities to banks went down to € 0.4 BN (2015: € 1.3 BN) as short-
term funding via repurchase agreements was significantly reduced.
Other intra-group financial liabilities rose to € 33.4 BN (2015:
€ 29.8 BN) and were composed of the following positions:
As of 31 December 2016, Allianz SE had the following outstanding
financial liabilities:
othEr intra-group financial liabilitiES
€ mn
financial liabilitiES
€ mn
as of 31 December
Intra-group subordinated liabilities
Third-party subordinated liabilities
Subordinated liabilities
Bonds issued to Group companies
Liabilities to banks
Other intra-group financial liabilities
Other third-party financial liabilities
Other financial liabilities
Total financial liabilities
2016
4,869
8,937
13,806
2,576
398
33,429
1,288
37,691
51,497
2015
4,869
7,471
12,340
3,258
1,344
29,753
1,663
36,018
48,358
as of 31 December
Intra-group loans
Cash pool liabilities
Miscellaneous
Other intra-group financial liabilities
2016
23,317
9,272
840
33,429
2015
20,397
8,345
1,011
29,753
Liabilities from intra-group loans increased by € 2.9 BN to € 23.3 BN and
liabilities from intra-group cash pooling by € 0.9 BN to € 9.3 BN. This
was partly offset by a decline of miscellaneous intra-group liabilities
by € 0.2 BN to € 0.8 BN.
In 2016, other third-party financial liabilities decreased by € 0.4 BN
to € 1.3 BN because short-term funding through European commercial
papers went down by € 0.1 BN to € 1.0 BN and other various third-party
financial liabilities declined by € 0.3 BN to € 0.3 BN.
Of these financial liabilities, € 40.9 BN (2015: € 37.9 BN) were intra-group
liabilities.
Subordinated liabilities increased to € 13.8 BN (2015: € 12.3 BN).
Details regarding this position are explained in note 11 to our financial
statements.
Annual Report 2016
Allianz se
17
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Management Report of Allianz se
Liquidity and Funding Resources
The responsibility for managing the funding needs of the Group, as
well as for maximizing access to liquidity sources and minimizing
borrowing costs, lies with Allianz SE.
Allianz SE has the option to increase its equity capital base
according to authorizations provided by the AGM. The following table
outlines Allianz SE’S capital authorizations as of 31 December 2016:
Liquidity Resources and Uses
Allianz SE ensures adequate access to liquidity and capital for our
operating subsidiaries. Main sources of liquidity available to Allianz SE
are dividends and funds received from subsidiaries, reinsurance pre-
miums received as well as funding provided by capital markets.
Liquidity resources are defined as readily available assets – specifi-
cally cash, money market investments, and highly liquid go vernment
bonds. Funds are primarily used for paying interest expenses on our
debt funding, claims arising from the reinsurance business, operat-
ing costs, internal and external growth investments, and dividends
to our shareholders.
Funding Sources
Allianz SE’s access to external funds depends on various factors such
as capital market conditions, access to credit facilities as well as
credit ratings and credit capacity. The financial resources available
to Allianz SE are both equity and debt funding. Equity can be raised
by issuing ordinary shares. The issuance of debt in various maturities
as well as group-wide liquidity management are the main sources of
our debt funding.
EQUITY FUNDING
As of 31 December 2016, the issued capital registered at the Commer-
cial Register was € 1,169,920,000. This was divided into 457,000,000
registered shares with restricted transferability. As of 31 December
2016, Allianz SE held 1,931,677 (2015: 2,175,776) own shares.
Capital authorizations of allianz se
Capital authorization
Nominal amount
Authorized Capital
2014/I
Authorized Capital
2014/II
€ 550,000,000
(214,843,750 shares)
€ 13,720,000
(5,359,375 shares)
Expiry date of
the authorization
6 May 2019
6 May 2019
Authorization to issue
bonds carrying conversion
and/or option rights
€ 10,000,000,000
(nominal bond value)
6 May 2019
(issuance of bonds)
Conditional Capital
2010/2014
€ 250,000,000
(97,656,250 shares)
No expiry date for
Conditional Capital
2010/2014 (issuance in
case option or conversion
rights are exercised)
For further details on Allianz SE’S capital authorizations, please refer
to note 10 to our financial statements.
DEBT FUNDING
The cost and availability of debt funding may be negatively affected
by general market conditions or by matters specific to the financial
services industry or to Allianz SE. Our main sources of debt funding
are senior and subordinated bonds. Among others, money market
securities, letter-of-credit facilities and bank credit lines allow
Allianz SE to fine-tune its capital structure.
In 2016, we had steady access to debt funding sources, enabling
us to actively steer the maturity profile of our funding structure. In
September 2016, Allianz SE issued an undated subordinated bond of
USD 1.5 BN, increasing our subordinated liabilities to € 13.8 BN (2015:
€ 12.3 BN) at year-end.
Other financial liabilities increased to € 37.7 BN (2015: € 36.0 BN),
mainly as a result of higher intra-group liabilities. For further details
on Allianz SE’S financial liabilities, please refer to notes 11 and 14 to
our financial statements.
18
Annual Report 2016
Allianz SE
B
Management Report of Allianz SE
Risk and Opportunity Report
Target and strategy of risk management
For the benefit of shareholders and policyholders alike, Allianz SE’s
aim is to ensure to be adequately capitalized at all times. This includes
meeting the Solvency II regulatory capital requirements resulting
from the internal model. Furthermore, risk capital reflec ting our risk
profile and cost of capital are important aspects to be taken into
account in business decisions.
We closely monitor the capital position of Allianz SE and apply
regular stress tests (standardized and historical stress test scena rios).
This allows us to take appropriate measures to ensure our continued
capital and solvency strength.
In doing this, the risk management system described in the fol-
lowing is applied.
decision-making processes. This also keeps risk strategy and busi-
ness objectives consistent with each other, and allows us to take
opportunities within our risk tolerance.
Risk reporting and monitoring: Our comprehensive qualitative
and quantitative risk reporting and monitoring framework provides
senior management with the transparency and risk indicators to help
them decide on our overall risk profile and assess whether it falls
within delegated limits and authorities. For example, risk dash-
boards as well internal risk allocation and limit consumption reports
are regularly prepared, communicated and monitored.
Communication and transparency: Finally, transparent and
robust risk disclosure provides the basis for communicating this
strategy to our internal and external stakeholders, ensuring a sus-
tainable and positive impact on valuation and financing. It also
streng thens the risk awareness and risk culture throughout Allianz SE.
Risk governance
RISK GOVERNANCE STRUCTURE
RISK MANAGEMENT FRAMEWORK
As the holding company of Allianz Group and a global reinsurer, we
consider risk management to be one of our core competencies. It is
therefore an integral part of our business processes. Our risk manage-
ment framework is risk-based and covers all business units of
Allianz SE. It encompasses IT, processes and departments within
Allianz SE. The key elements of our risk management framework are:
− Promotion of a strong risk management culture, supported by a
robust risk governance structure.
− Consistent application of an integrated risk capital model frame-
work across the business units to protect our capital base and
support effective capital management.
− Integration of risk considerations and capital needs into manage-
ment and decision-making processes through the attribution of
risk and allocation of capital to the various business units.
The comprehensive framework ensures that risks are identified, ana-
lyzed, managed, and assessed consistently across Allianz SE. Our risk
appetite is defined by a clear limit structure and a risk strategy con-
sistent with Allianz SE’s underlying business strategy. Close risk
monitoring and reporting allows us to detect potential deviations
from our risk tolerance at an early stage.
Our risk management system is based on the following four
essential elements:
Risk underwriting and identification: A sound risk underwriting
and identification framework forms the foundation for adequate risk
taking and management decisions, such as individual transaction
approvals and strategic asset allocations. The framework includes
risk assessments, risk standards, valuation methods, and clear mini-
mum standards for underwriting.
Risk strategy and risk appetite: Our risk strategy clearly defines
our risk appetite. It ensures that rewards are appropriate considering
the risks taken and that the delegated authorities are in line with our
overall risk-bearing capacity. The risk-return profile is improved
through integrating the risk considerations and capital needs into
SUPERVISORY BOARD AND BOARD OF MANAGEMENT
Within our risk governance system, the Supervisory Board and Board
of Management of Allianz SE have both Allianz SE and group-wide
responsibilities, and have set up committees to support them.
Supervisory Board
The Risk Committee of the Supervisory Board monitors the effective-
ness of Allianz SE’s risk management and monitoring framework.
Furthermore, it focuses on risk-related developments as well as
ge neral risks and specific risk exposures.
Board of Management
The Board of Management formulates business objectives and a cor-
responding, consistent risk strategy. The core elements of the risk
framework are set out in the Allianz Group Risk Policy, which is
approved by the Board of Management.
The Group Finance and Risk Committee (GFRC) ensures over-
sight of Allianz SE’s risk management framework, acting as a primary
early-warning function by monitoring Allianz SE’s risk profile as well
as the availability of capital. The GFRC also ensures that an adequate
relationship between return and risk is maintained. Additionally, the
GFRC defines risk standards, forms the limit-setting authority within
the framework set by the Board of Management, and approves major
single financing and reinsurance transactions. Finally, the GFRC sup-
ports the Board of Management with recommendations regarding
the capital structure, capital allocation and investment strategy,
including the strategic asset allocation. The GFRC is supported by
the Allianz Re Risk Committee on topics relating to the reinsurance
business of Allianz SE.
OVERALL RISK ORGANIZATION
AND ROLES IN RISK MANAGEMENT
A comprehensive system of risk governance is achieved by setting
standards related to organizational structure, risk strategy and appe-
tite, written policies, limit systems, documentation, and reporting.
These standards ensure the accurate and timely flow of risk-related
information and a disciplined approach towards decision-making
and execution.
Annual Report 2016
Allianz SE
19
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Management Report of Allianz SE
As a general principle, the “first line of defense” rests with busi-
ness managers in the business units of Allianz SE. They are responsible,
in the first instance, for both the risks of and returns on their decisions.
Our “second line of defense” is made up of our independent over-
Casualty reinsurance business. The latter allows us to identify profit-
able lines of business on a sustainable basis, which provide reason-
able profits on allocated risk capital. Therefore, it is a key criterion for
capital allocation decisions.
sight functions such as Risk, Actuarial, Compliance and Legal.
Audit forms the “third line of defense”. On a periodic basis, Audit
independently reviews Allianz SE’s risk governance implementation
and compliance with risk principles, performs quality reviews of risk
processes, and tests adherence to business standards, including the
internal control framework.
For all four functions, Allianz SE is covered by dedicated respon-
sibilities at the departments of Allianz SE (including reinsurance).
Risk
The functions of the Allianz Group’s Chief Risk Officer and of Allianz SE’s
Chief Risk Officer are performed by the same person. Independent
risk oversight for Allianz SE is conducted by risk control entities within
Group Risk and the reinsurance department of Allianz SE.
Other functions and bodies
In addition to the risk function for Allianz SE, Allianz SE legal and
compliance and actuarial functions have been established, constitut-
ing additional components of the “second line of defense”.
Allianz SE legal and compliance functions seek to mitigate legal
risks for Allianz SE with support from other departments. The objec-
tives of these legal and compliance functions are to ensure that laws
and regulations are observed, to react appropriately to all impending
legislative changes or new court rulings, to attend to legal disputes
and litigation, and to provide legally appropriate solutions for trans-
actions and business processes. In addition, Group Legal and Compli-
ance is responsible for integrity management, which aims to protect
Allianz SE and employees from regulatory risks.
The Allianz SE actuarial function contributes towards assessing
and managing risks in line with actuarial regulatory requirements.
These risks stem from the risk-taking/mitigating activities involving
professional actuarial experience. The range of tasks includes,
among others, the calculation and monitoring of technical provi-
sions, technical actuarial assistance in business planning, reporting
and monitoring of the result, and supporting the effective implemen-
tation of the risk management system.
Risk based steering and risk management
Allianz SE is exposed to a variety of risks through its holding company
and reinsurance activities. These include market, credit, underwriting,
business, operational, strategic, liquidity and reputational risks.
With Solvency II being the binding regulatory regime since
1 Janua ry 2016 and the approval of our internal model, risk is mea-
sured and steered based on the risk profile under lying our regulatory
capital requirement. By that we allow for a consistent view on risk
steering and capitalization under the Solvency II framework. This is
supplemented by economic scenarios and sensitivities.
Allianz SE steers its portfolio using a comprehensive view of risk
and return, i.e. results based on the internal risk model, including
scenario-based analysis, are actively used for decision making. On the
one hand, economic risk and concentrations are actively restric ted
by means of limits as outlined above. On the other hand, return on
risk capital (RoRC) is a key input in the underwriting of Property-
As we are Allianz Group’s holding company and a global rein-
surer, we consider diversification across different business segments
and geographic regions as a key element in managing our risks effi-
ciently by limiting the economic impact of any single event and by
contributing to relatively stable results and risk profile in general.
Therefore, our aim is to maintain a balanced risk profile without
bearing any disproportionately large risk concentrations and accu-
mulations.
In addition, central elements of Allianz SE’s dividend policy are
linked to the Solvency II capitalization based on our internal model.
This shows that the internal model is fully integrated in the business
steering of Allianz SE and that its application satisfies the so-called
“Use-test” under Solvency II.
MARKET RISK
Market risk from material M & A transactions of Allianz SE is managed
by assessing risk capital implications. With respect to investments,
top-down indicators such as strategic asset allocations are defined
for several sub-portfolios of Allianz SE and closely monitored to
ensure balanced investment portfolios. Furthermore, we have a li mit
system in place, which comprises economic limits, in particular
financial Value-at-Risk (VaR) and credit VaR as derived from the inter-
nal risk capital framework, complemented by stand-alone interest
rate and equity sensitivity limits as well as by limits on foreign
exchange exposures.
In order to further limit the impact of any financial market
changes and to ensure that assets adequately back liabilities, we have
additional measures in place. One of these is asset/liability manage-
ment (ALM), linked to the internal risk capital framework, which
incorporates risks as well as return aspects stemming from our rein-
surance and pension obligations. In addition, we are using deriva-
tives mostly to either hedge our planned dividend income from non-
Euro subsidiaries against adverse currency market movements or to
reduce our investment and reinvestment risk.
CREDIT RISK
Allianz SE monitors and manages credit risk exposures and concen-
trations to ensure it is able to meet obligations towards our counter-
parties when they are due.
Credit risks are reflected by the internal credit risk model as well
as in the obligor group limit management system. The internal cre dit
risk capital model considers the major drivers of credit risk for each
instrument, such as exposure at default, ratings, seniority, collateral,
and maturity. Additional parameters assigned to obligors are migra-
tion probabilities and obligor asset correlations reflecting dependen-
cies within the portfolio. Ratings are assigned to single obligors via an
internal rating approach, which is based on long-term ratings from
rating agencies. It is dynamically adjusted using market-implied rat-
ings and the most recently available qualitative information. The loss
profile of the Allianz SE portfolio is obtained through a Monte Carlo
simulation taking into account interdependencies and exposure
concentrations per obligor segment.
To ensure effective credit risk management, credit VaR limits are
derived from our internal risk capital framework as well as rating
bucket benchmarks, which define our risk appetite for exposures in
the lower investment grade and non-investment grade areas.
20
Annual Report 2016
Allianz SE
B
Management Report of Allianz SE
The group-wide country and obligor group limit management
framework (CRisP1) allows us to manage counterparty concentration
risk. It covers credit and equity exposures and is based on data used
by the investment and risk experts at the Group and operating entity
levels. This limit framework forms the basis for discussions on credit
actions. Clearly defined processes ensure that exposure concentrations
and limit utilizations are appropriately monitored and ma naged.
UNDERWRITING RISK
PROPERTY-CASUALTY
Our Property-Casualty reinsurance business is exposed to premium
risk related to the current year’s new and renewed business, as well
as reserve risk related to the business in force.
Premium risk is subdivided into natural catastrophe risk, terror
risk, and non-catastrophe risk. We calculate premium risk based on
actuarial models that are used to derive claims distributions and
consider the features of our reinsurance contracts (e.g. shares, limits,
reinstatements and commissions). Premium risk is actively mana-
ged by Allianz SE. The assessment of risks as part of the underwriting
process is a key element of our risk management framework. There
are clear underwriting limits and restrictions in place. Excessive risks
are mitigated by external retrocession agreements. All these measures
contribute to a limitation on risk accumulation.
We also monitor concentrations and accumulation of non-mar-
ket risks on a stand-alone basis (i.e. before diversification effects)
within an Allianz Group global limit framework in order to avoid sub-
stantial losses from single events such as natural catastrophes and
from man-made catastrophes such as terror or large industrial risk
accumulations.
Natural disasters, such as earthquakes, storms, and floods,
re present a significant challenge for risk management due to their
accumulation potential and occurrence volatility. In order to mea-
sure such risks and better estimate the potential effects of natural
disasters, we use special modeling techniques in which we combine
portfolio data (such as the geographic distribution and characteristics
of insured objects and their values) with simulated natural disaster
scenarios to estimate the magnitude and frequency of potential
losses. For significant exposures where such stochastic models do
not exist, we use deterministic, scenario-based approaches to esti-
mate potential losses. Similar models and scenario-based ap proaches
are used to evaluate risk concentrations and man-made catastrophes
including losses from terrorism, and industrial concentrations.
We constantly monitor the development of reserves for reinsu-
rance claims on a line-of-business level. In addition, Allianz SE con-
ducts annual reserve uncertainty analyses based on similar methods
used for reserve risk calculations. Where appropriate, expertise and
analysis of other Group entities is leveraged. The Allianz Group per-
forms regular independent reviews of these analyses.
LIFE/HEALTH
Underwriting risks in Allianz SE’s reinsurance operations and internal
pension obligations (biometric risks) include mortality, disabi lity,
morbi dity, and longevity risks. Mortality, disability, and morbi dity
risks are associated with the unexpected increase in the occurrence
of death, disability, or medical claims on our contracts. Longevity risk
is the risk that, due to changing biometric assumptions, the reserves
cove ring life annuities and pension contracts might not be sufficient.
We measure these risks within our internal risk capital model by
distinguishing between the different sub-components, whenever
re levant or material: absolute level, trend, volatility around the best
estimate assumptions, and pandemic risks.
OPERATIONAL RISK
Allianz SE’s operational risk management framework focuses on the
early recognition and proactive management of operational risks in
all “first line of defense” functions.
The Allianz SE risk function identifies and evaluates relevant
operational risks and control weaknesses via a dialogue with the
“first line of defense” functions. Furthermore, operational risk events
are collected in a central risk event database. Since 2015, Allianz SE
also delivers internal loss data on an anonymized basis to the “Oper-
ational Riskdata eXchange Association (ORX)”, a global operational
loss data insu rance consortium, to improve our internal control sys-
tem and to validate operational risk parameters.
The risks related to non-compliance or other misconduct are
addressed via various dedicated compliance programs. Written poli-
cies detail the Allianz Group’s approach towards the management of
these areas of risk. The implementation and communication of those
compliance programs are monitored by the Compliance function,
which also takes and enforces the risk mitigation measures in close
cooperation with the risk function of Allianz SE. With respect to finan-
cial statements, our internal control system is designed to mi tigate
operational risks.2
Major failures and disasters at our outsourcing providers may
represent significant operational risks for Allianz SE, as they could
cause a severe disruption to our working environment. Our business
continuity and crisis management framework strives to protect cri tical
business functions from these events and enables them, for example,
to carry out their core tasks on time and at the highest standard also
in a crisis event.
Allianz works on a cyber and information security program on
an ongoing basis, in order to better respond to external develop-
ments and to further strengthen the internal control environment for
related operational risks.
OTHER RISKS
There are certain risks that cannot be fully quantified using our inter-
nal risk capital model. For these risks we also pursue a systematic
approach with respect to identification, analysis, assessment, moni-
toring and steering. In general, the risk assessment is based on quali-
tative criteria or scenario analyses. The most important of these
other risks are strategic, liquidity and reputational risk.
STRATEGIC RISK
Strategic risks are evaluated and analyzed in the strategic and plan-
ning dialogue between the Allianz Group and operative functions at
Allianz SE, and controlled by monitoring of the respective business
goals.
We also monitor market and competitive conditions, capital
market requirements, regulatory conditions, etc. to decide whether to
make strategic adjustments.
1
Credit Risk Platform.
Annual Report 2016
Allianz SE
2
For additional information regarding our internal control system for financial reporting, please refer to
Controls over Financial Reporting on page 48.
21
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Management Report of Allianz SE
LIQUIDITY RISK
The main goal in planning and managing Allianz SE’s liquidity posi-
tion is to ensure that we are always able to meet payment obligations.
To comply with this objective, the liquidity position of Allianz SE is
monitored and forecast on a daily basis. Allianz SE’s short-term
liquidity is managed within Allianz SE’s cash pool, which serves as a
centralized tool for also investing the excess liquidity of other Group
companies. Strategic liquidity planning for Allianz SE over time hori-
zons of 12 months and three years is reported to the Board of Manage-
ment regularly.
The accumulated short-term liquidity forecast is subject to an
absolute minimum strategic cushion amount and an absolute mini-
mum liquidity target. Both are defined for the Allianz SE cash pool in
order to be protected against short-term liquidity crises.
As part of our strategic planning, contingent liquidity require-
ments and sources of liquidity are taken into account to ensure that
Allianz SE is able to meet any future payment obligations even under
adverse conditions. Major contingent liquidity requirements include
non-availability of external capital markets, combined market and
catastrophe risk scenarios for subsidiaries, as well as lower-than-
expected profit transfers and dividends from subsidiaries.
In order to protect the Allianz Group against the liquidity impact
of adverse risk events beyond those covered by the capital and liqui dity
buffers at our subsidiaries, Allianz SE is holding a strategic liqui dity
reserve.
In 2016, Allianz Group rolled out to Allianz SE and other Group
companies a newly developed group-wide liquidity risk framework in
order to further strengthen the liquidity risk management within
Allianz Group and the resilience to stress scenarios. To assess the
liquidity, this framework explicitly takes into account stress situations
for liquidity sources and needs, and allows for a group-wide consistent
view on liquidity risks.
REPUTATIONAL RISK
Allianz SE’s reputation as a well-respected and socially aware holding
and reinsurance company is influenced by our behavior in a range of
areas such as corporate governance, quality of reinsurance under-
writing, financial performance, customer service, employee relations,
intellectual capital, and corporate responsibility.
All affected Allianz SE functions cooperate in the identification
of reputational risk. Group Communications and Corporate Respon-
sibility assesses reputational risk for Allianz SE, based on a group-
wide methodology. In 2015, Allianz SE embedded conduct risk triggers
for fair contracts and services into the reputational risk ma nagement
process.
Internal risk capital framework
We define internal risk capital as the capital required to protect us
against unexpected, extreme economic losses, which forms the basis
for determining our Solvency II regulatory capitalization and the
associated risk profile. On a quarterly basis, we calculate internal risk
capital for Allianz SE in total, as well as for all contributing business
units. We also project risk capital requirements on a bi-weekly basis
during periods of financial market turbulence.
GENERAL APPROACH
We utilize an approach for the management of our risk profile and
solvency position that reflects the Solvency II rules.
INTERNAL RISK CAPITAL MODEL
Our internal risk capital model is based on a VaR approach using a
Monte Carlo simulation. Following this approach, we determine the
maximum loss in the portfolio value of our businesses in the scope
of the model within a specified timeframe (“hol ding period”) and
probability of occurrence (“confidence level”). We assume a confi-
dence level of 99.5 % and apply a holding period of one year. In the risk
simulation, we consider risk events from all modeled risk categories
(“sources of risk”) and calculate the portfolio value based on the net
fair value of assets and liabilities under potentially adverse conditions.
Risk capital is defined as the difference between the current port-
folio value and the portfolio value under adverse conditions depen-
dent on the 99.5 % confidence level. Because we simultaneously con-
sider the impact of a negative or positive event on all sources of risks
and co vered businesses, diversification effects across products and
regions are taken into account. The results of our Monte Carlo simu-
lation allow us to analyze our exposure to each source of risk, both
separately and in aggregate. In addition, in particular for market
risks, we analyze several pre-defined stress scenarios, based on either
historically observed market movements or on hypothetical market
movement assumptions. This modeling approach, therefore, also
enables us to identify scenarios that may have a positive impact on
our solvency situation.
COVERAGE OF THE RISK CAPITAL CALCULATIONS
Allianz SE’s internal risk capital model covers the activities of Allianz SE
as the holding company for Allianz Group, as well as a reinsurer.
Whereas most subsidiaries are covered through treatment as
participations, the model granular covers the very closely linked
activities of 27 subsidiaries, which are either financing entities or ser-
vice providers.
The identification and assessment of reputational risks are part
of the yearly Top Risk Assessment, during which senior management
also decides on a risk management strategy and related actions. This
is supplemented by quarterly updates. In addition, reputational risk
is managed on a case-by-case basis.
The risk capital model covers all relevant assets (including
bonds, loans, bank deposits, investment funds, equities and real
estate) and liabilities (including the cash flow run-off profile of all
technical reserves as well as issued debt, and other liabilities such as
guarantees).
For Allianz SE’s internal pension liabilities, guarantees embedded
in the contracts are taken into account.
22
Annual Report 2016
Allianz SE
ASSUMPTIONS AND LIMITATIONS
YIELD CURVE AND VOLATILITY ADJUSTMENT ASSUMPTIONS
When calculating the fair values of assets and liabilities, the assump-
tions regarding the underlying risk-free yield curve are crucial in
determining and discounting future cash flows. We apply the metho-
dology provided by the European Insurance and Occupational Pen-
sions Authority (EIOPA) within the technical documentation (EIOPA
BoS-15/035) for the extension of the risk-free interest rate curves
beyond the last liquid tenor.1
In addition, we adjust the risk-free yield curves by a volatility
adjustment in most markets where a volatility adjustment is defined
by EIOPA and approved by BaFin. This is done to better reflect the
underlying economics of our business. The advantage of being a long-
term investor, therefore, is the opportunity to invest in bonds yielding
spreads over the risk-free return and earning this additional yield
component over the duration of the bonds. Therefore, we reflect this
mitigation using a volatility adjustment spread risk offset, and view
the more relevant risk to be default risk rather than credit spread risk.
VALUATION ASSUMPTIONS: REPLICATING PORTFOLIOS
Since efficient valuation and complex, timely analysis are required
within the context of our internal model; we replicate internal pension
obligations. This technique enables us to represent guarantees by
means of standard financial instruments. In our risk calculation we
use the replicating portfolio to determine and revalue these liabi lities
under all potentially adverse Monte Carlo scenarios.
DIVERSIFICATION AND CORRELATION ASSUMPTIONS
Our internal risk capital model considers concentration, accumula-
tion, and correlation effects when aggregating results at Allianz SE
level. This reflects the fact that not all potential worst-case losses are
likely to materialize at the same time. This effect is known as diversi-
fication and forms a central element of our risk management frame-
work.
Where possible, we derive correlation parameters for each pair
of market risks through statistical analysis of historical market data,
considering quarterly observations over several years. In case his-
torical market data or other portfolio-specific observations are insuf-
ficient or not available, correlations are set according to a well-
defined group-wide process. Correlations are determined by the
Correlation Settings Committee, which combines the expertise of risk
and business experts. In general, we set the correlation para meters
to represent the joint movement of risks under adverse conditions.
Based on these correlations, we use an industry-standard approach,
the Gaussian copula approach, to determine the dependency struc-
ture of quantifiable sources of risk within the applied Monte Carlo
simulation.
B
Management Report of Allianz SE
ACTUARIAL ASSUMPTIONS
Our internal risk capital model also includes assumptions on claims
trends, liability inflation, mortality, longevity, morbidity, policyhol der
behavior, expense, etc. We use our own internal historical data for
actuarial assumptions wherever possible, leverage expertise of other
Allianz Group companies in the scope of the internal model, and also
consider recommendations from the insurance industry, supervisory
authorities, and actuarial associations. The derivation of our actua-
rial assumptions is based on generally accepted actuarial methods.
Within our internal risk capital and financial reporting framework,
comprehensive processes and controls exist for ensuring the reliabi lity
of these assumptions.
LIMITATIONS
Because of the 99.5 % confidence level, there is a low statistical pro-
bability of 0.5 % that actual losses could exceed this threshold at
Allianz SE level in the course of one year.
We use model and scenario parameters derived from historical
data, where available, to characterize future possible risk events. If
future market conditions differ substantially from the past, for exam-
ple in an unprecedented crisis, our VaR approach may be too conser-
vative or too liberal in ways that are difficult to predict. In order to
mitigate reliance on historical data, we complement our VaR analysis
with stress testing.
Furthermore, we validate the model and parameters through
sensitivity analyses, independent internal peer reviews, and, where
appropriate, independent external reviews, focusing on methods for
selecting parameters and control processes. Overall, we believe that
our validation efforts are effective – to the extent possible – and that
the model adequately assesses the risks to which we are exposed.
The construction and application of the replicating portfolios
mentioned is subject to the set of replicating instruments available,
and might, therefore, be too simple or too restrictive to capture all
factors affecting the change in value of obligations. As with other
mo del components, the replications are subject to independent vali-
dation and to suitability assessments as well as to stringent data and
process quality controls. Therefore, we believe that the obligations
are adequately represented by the replicating portfolios.
Since the internal risk capital model takes into account the
change in the economic fair value of our assets and liabilities, it is
crucial to estimate the market value of each item accurately. For
some assets and liabilities it may be difficult, if not impossible – nota-
bly in distressed financial markets – to obtain either a current market
price or to apply a meaningful mark-to-market approach. For such
assets we apply a mark-to-model approach. For some of our liabilities,
the accuracy of their values additionally depends on the quality of the
actua rial cash flow estimates. Despite these limitations, we believe
the estimated fair values are appropriately assessed.
MODEL CHANGES IN 2016
There were no major model changes in 2016. Allianz SE is affected by
two minor Allianz Group model changes. For longevity risk, shock
factors have been newly calibrated. In addition, for interest rate risk
modelling, the granularity of the reflection of long maturities in the
Euro and Swiss Franc yield curves has been increased.
1
Due to late availability of the EIOPA publication, the risk-free interest rate term structure used might
slightly differ from the one published by EIOPA.
Annual Report 2016
Allianz SE
23
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Management Report of Allianz SE
Allianz SE risk profile
and management assessment
RISK PROFILE AND MARKET ENVIRONMENT
The quantitative risk profile of the legal entity Allianz SE is primarily
dominated by market risk resulting from its non-traded insurance
participations when measured in a manner consistent with the treat-
ment of participations under Solvency II (e.g. without looking through
to the underlying risks behind the participations). In order to provide
greater transparency, the Group risk figures as reflected in the Allianz
Group Annual Report can be interpreted as a “look-through” into the
consolidated risk profile represented by all of the Group’s participa-
tions as well as those risks unique to Allianz SE. The second largest
risk for Allianz SE from an internal model perspective is underwriting
risk arising from its reinsurance business and internal pensions.
The risk profile and relative contributions have changed in 2016,
due to changes in the market environment, management actions,
and minor model changes. These model changes are described in the
section Model changes in 2016.
FINANCIAL MARKETS AND OPERATING ENVIRONMENT
Financial markets are characterized by historically low interest rates
and risk premia, prompting investors to look for higher-yielding –
and potentially higher-risk – investments. In addition to sustained
low interest rates, the challenges of implementing long-term struc-
tural reforms in key Eurozone countries and the uncertainty about
the future path of monetary policy may lead to continued market
volatility. This could be accompanied by a flight to quality, combined
with falling equity and bond prices due to rising spread levels, even
in the face of potentially lower interest rates. Also, possible asset
bubbles (as observed in the Chinese equity market) might spill over
to other markets, contributing to increasing volatility.
Therefore, we continue to closely monitor the political and finan-
cial developments in the Eurozone – such as Brexit in the U.K. and the
“No” vote to constitutional reforms in Italy – in order to manage our
overall risk profile to specific event risks.
REGULATORY DEVELOPMENTS
Following the approval of our internal model in November 2015, the
model has been fully applied since the beginning of 2016, with the
Solvency II day one reporting.
MANAGEMENT ASSESSMENT
Allianz SE’s management feels comfortable with Allianz SE’s overall
risk profile and has confidence in the effectiveness of its risk manage-
ment framework to meet the challenges of a rapidly changing envi-
ronment as well as of day-to-day business needs. This confidence is
based on several factors, which are outlined in more detail in the sec-
tions that follow and are summarized below:
− Due to its effective capital management, Allianz SE is well capita-
lized and met its regulatory solvency targets as of 31 December
2016.
− Allianz SE’s management also believes that Allianz SE is well posi-
tioned to deal with potentially adverse future events, in part due
to our strong internal limit framework defined by Allianz SE’s risk
appetite and risk management practices including our approved
internal model.
− Allianz SE has a conservative investment profile and disciplined
business practices in the reinsurance business, leading to sustain-
able operating earnings with a well-balanced risk-return profile.
SOLVENCY II REGULATORY CAPITALIZATION
Allianz SE’s own funds and capital requirements are based on the
market value balance sheet approach as the major economic principle
of Solvency II rules.1 Our capitalization based on these requirements
is shown in the following table.
AlliAnz SE: SolvEncy ii rEgulAtory cApitAlizAtion
as of 31 December
Own funds
Capital requirement
Capitalization ratio
€ Bn
€ Bn
%
2016
81.3
20.9
389
2015
78.0
20.8
375
As of 31 December 2016, the Solvency II capitalization of the legal
entity Allianz SE is at 389 %. The increase by 14 percentage points in
2016 was driven by a significant € 3.3 bn increase in own funds, which
was only marginally compensated by a slight € 0.1 bn rise in capital
requirements.
Quantifiable risks and opportunities
by risk category
This Risk and Opportunity Report outlines Allianz SE’s risk figures,
reflecting its risk profile based on pre-diversified risk figures and
Allianz SE-diversification effects. Pre-diversified risk figures reflect the
diversification effect within each modeled risk category (i.e. market,
credit, underwriting, business, and operational risk) but do not com-
prise the diversification effects across risk categories. Allianz SE’s
diversified risk also captures the diversification effect across all risk
categories.
As of 31 December 2016, the Allianz SE-diversified risk capital of
€ 20.9 bn (2015: € 20.8 bn) represented a diversification benefit of
approximately 14 % (2015: 15 %) across risk categories.
AlliAnz SE: AllocAtEd riSk According to tHE riSk profilE
€ mn
as of 31 December
Market risk
Credit risk
Underwriting risk
Business risk
Operational risk
Diversification
Capital add-on
Total Allianz SE
2016
19,664
633
2,731
46
773
(3,325)
391
20,913
2015
19,588
664
2,962
43
765
(3,584)
357
20,795
1
Own funds and capital requirement are calculated under consideration of volatility adjustment and yield
curve extension, as described in Yield curve and volatility adjustment assumptions on page 23.
24
Annual Report 2016
Allianz SE
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Management Report of Allianz SE
In the following sections we explain the evolution of the risk profile
per modeled risk category. All risks are presented on a pre-diversified
basis, and concentrations of single sources of risk are discussed
accordingly.
As of 31 December 2016, Allianz SE’s interest-rate-sensitive
investment assets amounting to a market value of € 43.6 bn would
have gained € 1.6 bn or lost € 2.3 bn in value, in the event of interest
rates chan ging by -100 and +100 basis points, respectively.
MARKET RISK
Allianz SE is the ultimate holding entity in the Allianz Group. As a
result, participation assets represent approximately 69 % of the total
investment assets.
As an inherent part of our reinsurance operations, we collect
premiums from our customers and invest them in a wide variety of
assets. The resulting investment portfolio backs the future claims
and benefits to our cedents.
For our holding activities (i.e. to cover internal pension liabili-
ties, invest cash pooled from subsidiaries, and in our capacity as the
lender of last resort within Allianz Group), Allianz SE mainly invests
in fixed-income assets.
In addition we invest shareholders’ capital, which is required to
support the risks underwritten and the holding activities.
Thereby, Allianz SE holds and uses a broad range of financial
instruments. As the fair values of the majority of our assets and liabili-
ties depend on financial markets, which may change over time, we
are exposed to market risks.
For the legal entity Allianz SE, the pre-diversified market risk
showed a marginal increase of € 76 Mn, driven by a rise in equity risk.
The following table shows the market risk of Allianz SE related to
the sources of risk.
AlliAnz SE: riSk profilE – MArkEt riSk By SourcE of riSk
pre-diversified, € mn
as of 31 December
Interest rate
Inflation
Credit spread
Equity
Real estate
Currency
Total Allianz SE
2016
232
535
510
2015
260
515
578
18,103
17,976
74
210
66
193
19,664
19,588
INTEREST RATE RISK
Given the long duration of parts of our internal pension obligations
and reinsurance liabilities, we are specifically exposed to interest rate
risk because we have to reinvest maturing assets prior to the matu-
rity of the related liabilities. This interaction between our investment
strategy and pension obligations as well as reinsurance liabilities
forms an integral part of our internal risk capital framework. In addi-
tion, our ALM approach is closely linked to the internal risk capital
framework, and designed to achieve investment returns over the long
term in excess of the obligations.
The € 232 Mn interest rate risk capital requirements for Allianz SE
mainly arise from fixed-rate bonds and loans on the asset side, as
well as from issued Allianz corporate bonds, received loans, reinsu-
rance technical provisions and pension benefit obligations on the
liability side.
In 2016, interest rate risk decreased by € 28 Mn, mainly reflecting
changes in Allianz Group financing structures.
As described above, risk related to interest rates lies in the fact
that, in the long run, yields that can be achieved by reinvesting may
not be sufficient enough to cover the obligations. In contrast, oppor-
tunities may materialize when interest rates increase. This may
result in higher returns from reinvestments than required to match
the obligations.
INFLATION RISK
Since inflation increases both reinsurance claims and costs, as well
as internal pension obligations, higher inflation rates will lead to
greater liabilities. Thus, primary sources for the € 535 Mn inflation risk
of the legal entity Allianz SE in 2016 are reinsurance liabilities and
internal pension obligations. The € 20 Mn increase in 2016 mainly
reflects higher risk from both sources.
Inflation assumptions are already taken into account in our rein-
surance underwriting, and the risk of changing inflation rates is
incorporated in our internal model. In case future inflation rates lie
(sustainably) below assumptions, liabilities would be lower than
anticipated.
EQUITY RISK
Allianz SE is the ultimate holding entity in the Allianz Group. Thus,
most of the equity risk of Allianz SE reflects insu rance participations.
In 2016, Allianz SE had profit-and-loss transfer agreements with ele ven
German subsidiaries in place. These are listed in the appendix on
page 68. Risk from these contracts is reflected via the risk capital
calculation on participations.
In 2016, Allianz SE’s equity risk increased by € 127 Mn, mainly
reflecting changes in the value of participations in Allianz Group
companies as well as a reduction in investments in traded equities.
As of 31 December 2016, our investment assets that are sensitive
to changing equity markets would have lost € 374 Mn in value, assum-
ing equity markets declined by 30 %.
Allianz SE’s equity risk primarily results from the performance
of our insurance participations, as well as changes in the value of
equity prices. The latter are normally associated with decreasing
equitiy prices and increasing equity price volatilities. As the perfor-
mance of our participations might exceed expectations, and stock
market values also might increase, opportunities arise from partici-
pations and other equity investments.
CREDIT SPREAD RISK
Our internal risk capital framework fully acknowledges the risk of
declining market values for our fixed-income assets, such as bonds,
due to the widening of credit spreads. However, for our risk manage-
ment and appetite, we also take into account the underlying econo-
mics of our business model; for example, the application of the vola-
tility adjustment in our internal risk capital framework to partially
mitigate spread risk, as described in the section on yield curve and
volatility adjustment assumptions.
Allianz SE’s credit spread risk is € 68 Mn lower than in 2015. This
is dominantly explained by changes in Allianz Group financing
structures.
Annual Report 2016
Allianz SE
25
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Management Report of Allianz SE
CURRENCY RISK
In addition to risk from Allianz SE’s non-Euro participations,
Allianz SE’s currency risk is driven by its non-Euro reinsurance
ex posure, as well as by the use of non-Euro bonds as external financ-
ing instruments.
Allianz SE’s € 210 Mn currency risk at year-end 2016 mainly re flects
net open positions in U.S. Dollar, Swiss Franc and Australian Dollar.
The moderate increase of € 17 Mn in 2016 is primarily caused by
changes in the value of non- Euro participations and changes in the
Group financing structures.
In 2016, Allianz SE’s natural catastrophe risk increased by
€ 43 Mn, mainly reflecting changes in risks from intra-group quota
shares and effects from changes in insurance risk diversification. The
top five scenarios contributing to the natural catastrophe risk of
Allianz SE as of December 2016 were: a windstorm in Europe, an earth-
quake in Australia, a tropical cyclone in Australia, an earthquake in
Italy, as well as a tropical cyclone in Japan.
The € 314 Mn decrease in non-catastrophe and terror premium
risk of Allianz SE in 2016 can be mainly explained by changes in rein-
surance structures within Allianz Group.
REAL ESTATE RISK
As of 31 December 2016, real estate risk for Allianz SE is minor
(€ 74 Mn). The marginal increase in 2016 of € 8 Mn reflects a rise in the
market value of properties.
CREDIT RISK
Credit risk is measured as the potential economic loss in the value of
our portfolio that is due to either changes in the credit quality of our
counterparts (“migration risk”) or the inability or unwillingness of
the counterparty to fulfill contractual obligations (“default risk”).
Allianz SE’s credit risk arises from our fixed-income investments,
cash positions, derivatives, receivables from debtors, as well as from
reinsurance recoverables.
Throughout 2016, the credit environment was mostly stable.
Annual updates based on extended time series were performed for
credit risk parameters like the transition matrix and asset correla-
tions, which also had a slightly positive effect on credit risk. These
effects were partially offset by declining interest rates, which gene-
rally increased credit risk exposures and correspondingly credit risk.
Credit risk of the legal entity Allianz SE decreased by € 31 Mn in
2016, resulting from changes in the Group financing structures.
UNDERWRITING RISK
Allianz SE’s underwriting risk consists of premium and reserve risks
from the Property-Casualty reinsurance business, as well as of bio-
metric risks from both internal pension liabilities and the Life/Health
reinsurance business.
Reserve risk
We estimate and hold reserves for reinsurance claims resulting from
past events that have not yet been settled. If the reserves are not suf-
ficient to cover claims to be settled in the future, due to unexpected
changes, we would experience losses. Conversely, in case our reserves
would turn out to be too conservative, there is the chance for positive
returns. The volatility of past claims measured over a one-year time
horizon defines our reserve risk.
Allianz SE’s € 119 Mn increase in reserve risk in 2016 mainly
reflects new reinsurance quota shares with European Allianz entities,
together with effects from changes in insurance risk diversification.
LIFE/HEALTH
Life/Health underwriting risk arises from profitability being lower than
expected due to changes in actuarial parameters. As profitabi lity cal-
culations are based on several parameters – such as historical loss
information, assumptions on inflation or on mortality and morbidity –
the realized parameters may differ from the ones used for calculation.
For example, inflation which is higher than what we incorporated in
the calculations may lead to a loss. However, deviations can also occur
in the opposite direction and be beneficial and lead to additional
profit. For example, a lower-than-expected morbi dity rate will most
likely result in lower claims.
Allianz SE’s life and health underwriting risk is do minated by
longevity risk from internal pensions.
In 2016, the biometric risk of Allianz SE is € 79 Mn lower than in
2015, which is dominantly reflecting changes in the modelling of lon-
gevity risk.
AlliAnz SE: riSk profilE – undErwriting riSk By SourcE of riSk
pre-diversified, € mn
as of 31 December
Premium natural catastrophe
Premium non-catastrophe and terror
Reserve
Biometric
Total Allianz SE
2016
315
1,429
949
38
2,731
2015
272
1,743
830
117
2,962
BUSINESS RISK
Allianz SE’s business risk consists of cost risk from Property-Casualty
reinsurance business and of policy-holder behavior risk from both
Life/Health and Property-Casualty reinsurance. Reflecting the business
model of Allianz SE as primarily a group-internal reinsurer, business
risk is minor.
As for underwriting risks, a positive deviation from the under-
lying parameters will lead to additional returns.
PROPERTY-CASUALTY
Our Property-Casualty reinsurance business is exposed to premium
risk related to the current year’s new and renewed business as well as
to reserve risks related to the business in force.
Both premium risk and reserve risk also include exposures from
the reinsurance contract on the Euler-Hermes trade credit insurance
and bonding business.
Premium risk
As part of our Property-Casualty reinsurance business, we receive
premiums from our cedents and provide reinsurance protection in
return.
OPERATIONAL RISK
Operational risks represent losses resulting from inadequate or failed
internal processes, from personnel and systems, or from external
events – including legal and compliance risk, but excluding losses
from strategic and reputational risk.
Reflecting Allianz SE’s tasks as holding company for Allianz
Group and reinsurer, the most important operational risk capital
scenarios are in the areas of tax, legal and compliance.
Allianz SE’s operational risk capital marginally increased in 2016
caused by an annual parameter update.
26
Annual Report 2016
Allianz SE
Corporate Governance Report
B
Management Report of Allianz se
BOARD OF MANAGEMENT AND GROUP COMMITTEES
In the financial year 2016, there were the following Board of Manage-
ment committees:
Board Committees
Board CoMMITTEEs
rEsPoNsIBILITIEs
GrouP CaPITaL CoMMITTEE
(dissolved effective as of 1 July 2016)
Oliver Bäte (Chairman),
Dr. Dieter Wemmer,
Dr. Maximilian Zimmerer.
GrouP FINaNCE aNd rIsk CoMMITTEE
Dr. Dieter Wemmer (Chairman),
Sergio Balbinot,
Dr. Helga Jung until 6 July 2016,
Jay Ralph until 30 June 2016,
Dr. Axel Theis,
Dr. Maximilian Zimmerer.
GrouP IT CoMMITTEE
Dr. Christof Mascher (Chairman),
Jay Ralph until 30 June 2016,
Jacqueline Hunt from 1 July 2016,
Dr. Axel Theis,
Dr. Dieter Wemmer,
Dr. Werner Zedelius.
GrouP MErGErs
aNd aCquIsITIoNs CoMMITTEE
Dr. Helga Jung (Chairwoman),
Oliver Bäte from 7 July 2016,
Dr. Dieter Wemmer,
Dr. Maximilian Zimmerer until 6 July 2016.
as of 31 December 2016
Proposals to the Board of Management
concerning risk capital management,
including group-wide capital and liquidity
planning, as well as investment strategy.
Preparation of the capital and liquidity
planning for the Group and Allianz sE,
implementing and overseeing the
principles of group-wide capital and
liquidity planning, as well as invest ment
strategy and preparing risk strategy.
This includes, in particular, significant
individual investments and guidelines for
currency management, Group financing
and internal Group capital management,
as well as establishing and overseeing a
group-wide risk management and
monitoring system including dynamic
stress tests.
Developing, proposing, implementing
and monitoring a group-wide IT strategy,
approval of relevant IT investments.
Managing and overseeing Group M & A
transactions, including approval of
individual transactions within certain
thresholds.
Besides Board committees, there are also Group committees whose
job it is to prepare decisions for the Board of Management of Allianz SE,
submit proposals for resolutions, and ensure the smooth flow of
information within the Group.
Good corporate governance is essential for sustainable business per-
formance. The Board of Management and the Supervisory Board of
Allianz SE thus attach great importance to complying with the recom-
mendations of the German Corporate Governance Code (referred to
hereinafter as the “Code”). The Declaration of Conformity with the
recommendations of the Code, issued by the Board of Management
and the Supervisory Board on 15 December 2016, and the company’s
position regarding the Code’s suggestions can be found in the State-
ment on Corporate Management pursuant to § 289a of the HGB start-
ing on
page 32.
Corporate Constitution
of the European Company (SE)
As a European Company, Allianz SE is subject to special European SE
regulations and the German SE Implementation Act (“SE-Ausfüh-
rungsgesetz”) in addition to the German stock corporation Act. How-
ever, the main features of a German stock corporation – in particular
the two-tier board system (Board of Management and Supervisory
Board) and the principle of equal employee representation on the
Super visory Board – have been maintained by Allianz SE.
Function of the Board of Management
The Board of Management of Allianz SE comprises nine members. It
is responsible for setting business objectives and the strategic direc-
tion, coordinating and supervising the operating entities, as well as
implementing and overseeing an efficient risk management system.
The Board of Management also prepares the Group’s consolidated
financial statements and the annual financial statements of Allianz SE,
including the market value balance sheet, as well as interim reports.
The members of the Board of Management are jointly responsi-
ble for management and for complying with legal requirements. Not-
withstanding this overall responsibility, the individual members
head the departments they have been assigned independently. There
are divisional responsibilities for business segments as well as func-
tional responsibilities. The latter include the Finance-, Risk Manage-
ment- and Controlling-Function, Investments, Operations – includ-
ing IT –, Human Resources, Legal and Compliance, Internal Audit and
Mergers & Acquisitions. Business division responsibilities focus on
geographical regions or Global Lines, such as Asset Management.
Rules of procedure specify in more detail the structure and depart-
mental responsibilities of the Board of Management.
Regular Board of Management meetings are led by the Chair-
man. Each member of the Board may request a meeting, providing
notification of the proposed subject. The Board takes decisions by a
simple majority of participating members. In the event of a tie, the
Chairman casts the deciding vote. The Chairman can also veto deci-
sions, but cannot impose any decisions against the majority vote.
Annual Report 2016
Allianz sE
27
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Management Report of Allianz se
In the financial year 2016, there were the following Group commit-
tees:
group Committees
GrouP CoMMITTEEs
rEsPoNsIBILITIEs
GrouP CoMPENsaTIoN CoMMITTEE
Board members of Allianz sE and
executives below Allianz sE Board level
GrouP uNdErwrITING CoMMITTEE
(continued as a functional committee
within Dr. Theis’ area of responsibility
effective as of 1 July 2016)
Members of the Board of Management,
executives below Allianz sE Board level
and Chief Underwriting Officers of Group
companies
GrouP INvEsTMENT CoMMITTEE
Members of the Board of Management
and executives below Allianz sE Board
level
Designing, monitoring and improving
group-wide compensation systems in line
with regulatory requirements and sub -
mitting an annual report on the results of
its monitoring, along with proposals for
improvement.
Monitoring of the underwriting business,
of the related risk management and
strategy as well as developing an under-
writing policy.
Implementing Group investment strategy,
including monitoring group-wide invest -
ment activities as well as approving invest-
ment-related frameworks and guidelines
and individual investments within certain
thresholds.
The Allianz Group runs its operating entities and business segments
via an integrated management and control process. The Holding and
the operating entities first define the business strategies and goals.
On this basis, joint plans are then prepared for the Supervisory
Board’s consideration when setting targets for the performance-
based remuneration of the members of the Board of Management.
For details, see the Remuneration Report starting on
page 34.
The Board of Management reports regularly and comprehen-
sively to the Supervisory Board on business development, the finan-
cial position and earnings, planning and achievement of objectives,
business strategy and risk exposure. Details on the Board of Manage-
ment’s reporting to the Supervisory Board are laid down in the report-
ing rules issued by the Supervisory Board.
Important decisions of the Board of Management require
approval by the Supervisory Board. These requirements are stipu-
lated by law, by the Statutes, or in individual cases by decisions of the
Annual General Meeting (AGM). Supervisory Board approval is
required, for example, for certain capital transactions, intercompany
agreements and the launch of new business segments or the closure
of existing ones. Approval is also required for acquisitions of compa-
nies and holdings in companies, as well as for divestments of Group
companies which exceed certain threshold levels. The Agreement
concerning the Participation of Employees in Allianz SE, in the version
dated 3 July 2014 (hereinafter “SE Agreement”), requires the approval
of the Supervisory Board for the appointment of the member of the
Board of Management responsible for employment and social welfare.
Principles and function
of the Supervisory Board
The German Co-Determination Act (“Mitbestimmungsgesetz”) does
not apply to Allianz SE because it has the legal form of a European
Company (SE). Instead, the size and composition of the Supervisory
Board are determined by general European SE regulations. These
regulations are implemented in the Statutes and by the SE Agree-
ment.
The Supervisory Board comprises twelve members, including six
shareholder representatives appointed by the AGM. The six employee
representatives are appointed by the SE works council. The specific
procedure for their appointment is laid down in the SE Agreement.
This agreement stipulates that the six employee representatives
must be allocated in proportion to the number of Allianz employees
in the different countries. The Supervisory Board currently in office
comprises four employee representatives from Germany and one
each from France and Italy. The last regular election of the Super-
visory Board took place in May 2012 for a term lasting until the end of
the ordinary AGM in 2017. According to § 17 (2) of the German SE
Imple mentation Act (“SE-Ausführungsgesetz”), the Supervisory Board
of Allianz SE shall be composed of at least 30 % women and at least 30 %
men as of 1 January 2016.
The Supervisory Board oversees and advises the Board of
Ma nagement on managing the business. It is also responsible for
appointing the members of the Board of Management, determining
their overall remuneration and reviewing Allianz SE’s and the Allianz
Group’s annual financial statements. The Supervisory Board’s activi-
ties in the 2016 financial year are described in the Supervisory Board
Report starting on
page 2.
The Supervisory Board takes all decisions based on a simple
majority. The special requirements for appointing members to the
Board of Management, as stipulated in the German Co-Determina-
tion Act, and the requirement to have a Conciliation Committee do
not apply to an SE. In the event of a tie, the casting vote lies with the
Chairman of the Supervisory Board, who at Allianz SE must be a
shareholder representative. If the Chairman is not present in the
event of a tie, the casting vote lies with the vice chairperson from the
shareholder side. A second vice chairperson is elected on the pro-
posal of the employee representatives.
The Supervisory Board regularly reviews the efficiency of its
activities. The Supervisory Board discusses recommendations for
improvements and adopts appropriate measures on the basis of
re commendations from the Standing Committee. The efficiency
review also includes an evaluation of the fitness and propriety of the
individual members.
28
Annual Report 2016
Allianz sE
B
Management Report of Allianz se
SUPERVISORY BOARD COMMITTEES
Part of the Supervisory Board’s work is carried out by its committees.
The Supervisory Board receives regular reports on the activities of its
committees. The composition of committees and the tasks assigned
to them are regulated by the Supervisory Board’s Rules of Procedure.
PUBLICATION OF DETAILS
OF MEMBERS’ PARTICIPATION IN MEETINGS
The Supervisory Board considers it good corporate governance to
publish the details of individual members’ participation in plenary
sessions and committee meetings.
supervisory Board Committees
puBliCation of details of memBers’ partiCipation in meetings
rEsPoNsIBILITIEs
− Approval of certain transactions which require
the approval of the Supervisory Board, e.g. capital
measures, acquisitions and disposals of
participations
PLENary sEssIoNs oF THE suPErvIsory Board
Dr. Helmut Perlet (Chairman)
Dr. Wulf H. Bernotat (Vice Chairman)
− Preparation of the Declaration of Conformity
Rolf Zimmermann (Vice Chairman)
suPErvIsory Board
CoMMITTEEs
sTaNdING CoMMITTEE
5 members
− Chairman: Chairman
of the Supervisory Board
(Dr. Helmut Perlet)
− Two further shareholder
representatives (Prof. Dr. Renate
Köcher, Dr. Wulf H. Bernotat)
− Two employee represen tatives
(Gabriele Burkhardt-Berg,
Rolf Zimmermann)
audIT CoMMITTEE
5 members
− Chairman: appointed
by the Supervisory Board
(Dr. Wulf H. Bernotat)
− Three shareholder
representatives (in addition to
Dr. Wulf H. Bernotat: Dr. Helmut
Perlet, Jim Hagemann Snabe)
− Two employee represen tatives
(Jean-Jacques Cette,
Ira Gloe-Semler until 31 March
2016, Martina Grundler from
4 May 2016)
rIsk CoMMITTEE
5 members
− Chairman: appointed by
the Supervisory Board
(Dr. Helmut Perlet)
− Three shareholder
representatives (in addition to
Dr. Helmut Perlet: Christine
Bosse, Peter Denis Sutherland
until 4 May 2016, Dr. Friedrich
Eichiner from 4 May 2016)
− Two employee represen tatives
(Dante Barban, Jürgen Lawrenz)
PErsoNNEL CoMMITTEE
3 members
− Chairman: Chairman
of the Supervisory Board
(Dr. Helmut Perlet)
− One further shareholder
representative
(Christine Bosse)
− One employee represen tative
pursuant to § 161 “Aktiengesetz” (German Stock
Corporation Act) and checks on corporate
governance
− Preparation of the efficiency review of the
Supervisory Board
− Initial review of the annual Allianz sE and consoli-
dated financial statements, management reports
(incl. Risk Report) and the dividend proposal,
review of half-yearly reports or, where applicable,
quarterly financial reports or statements
− Monitoring of the financial reporting process,
the effectiveness of the internal control and audit
system and legal and compliance issues
− Monitoring of the audit procedures, including
the independence of the auditor and the services
additionally rendered, awarding of the audit
contract and determining the focal points of the
audit
− Monitoring of the general risk situation and
special risk developments in the Allianz Group
− Monitoring of the effectiveness of the risk
management system
− Initial review of the Risk Report and other
risk-related statements in the annual financial
statements and management reports of
Allianz sE and the Allianz Group, informing the
Audit Committee of the results of such reviews
− Preparation of the appointment of Board of
Management members
− Preparation of plenary session resolutions on the
compensation system and the overall compen-
sation of Board of Management members
− Conclusion, amendment and termination of
service contracts of Board of Management
members unless reserved for the plenary session
− Long-term succession planning for the Board of
(Rolf Zimmermann)
Management
− Approval of the assumption of other mandates by
Board of Management members
− Setting of concrete objectives for the composition
of the Supervisory Board
− Establishment of selection criteria for shareholder
representatives on the Supervisory Board in
compliance with the Code’s recommendations
on the composition of the Supervisory Board
− Selection of suitable candidates for election to the
Supervisory Board as shareholder representatives
NoMINaTIoN CoMMITTEE
3 members
− Chairman: Chairman
of the Supervisory Board
(Dr. Helmut Perlet)
− Two further shareholder
representatives (Prof. Dr. Renate
Köcher, Peter Denis Sutherland
until 4 May 2016, Jim Hagemann
Snabe from 4 May 2016)
Annual Report 2016
Allianz sE
Dante Barban
Christine Bosse
Gabriele Burkhardt-Berg
Jean-Jacques Cette
Dr. Friedrich Eichiner
Ira Gloe-Semler
Martina Grundler
Prof. Dr. Renate Köcher
Jürgen Lawrenz
Jim Hagemann Snabe
Peter Denis Sutherland
sTaNdING CoMMITTEE
Dr. Helmut Perlet (Chairman)
Dr. Wulf H. Bernotat
Gabriele Burkhardt-Berg
Prof. Dr. Renate Köcher
Rolf Zimmermann
PErsoNNEL CoMMITTEE
Dr. Helmut Perlet (Chairman)
Christine Bosse
Rolf Zimmermann
audIT CoMMITTEE
Dr. Wulf H. Bernotat (Chairman)
Jean-Jacques Cette
Ira Gloe-Semler
Martina Grundler
Jim Hagemann Snabe
Dr. Helmut Perlet
rIsk CoMMITTEE
Dr. Helmut Perlet (Chairman)
Dante Barban
Christine Bosse
Dr. Friedrich Eichiner
Jürgen Lawrenz
Peter Denis Sutherland
NoMINaTIoN CoMMITTEE
Dr. Helmut Perlet (Chairman)
Prof. Dr. Renate Köcher
Peter Denis Sutherland
Jim Hagemann Snabe
1
2
3
4
5
Dr. Eichiner joined the Supervisory Board on 4 May 2016.
Ms. Gloe-Semler left the Supervisory Board on 31 March 2016.
Ms. Grundler joined the Supervisory Board on 1 April 2016.
Mr. Sutherland left the Supervisory Board on 4 May 2016.
Mr. Snabe joined the Nomination Committee on 4 May 2016.
PrEsENCE
IN %
6/6
6/6
6/6
6/6
4/6
6/6
6/6
3/3 1
2/2 2
4/4 3
5/6
6/6
5/6
2/3 4
2/2
2/2
2/2
1/2
2/2
3/3
3/3
3/3
7/7
5/7
2/2 2
4/5 3
6/7
7/7
2/2
2/2
2/2
1/1 1
2/2
0/1 4
4/4
4/4
1/2 4
2/2 5
100
100
100
100
66
100
100
100
100
100
83
100
83
66
100
100
100
50
100
100
100
100
100
71
100
80
86
100
100
100
100
100
100
–
100
100
50
100
29
B
Management Report of Allianz se
OBJECTIVES OF THE SUPERVISORY BOARD
REGARDING ITS COMPOSITION
The objectives for the composition of the Supervisory Board (in the
version from August 2016) to implement a recommendation by the
Code, are as follows:
oBjeCtives of allianz se’s supervisory Board regarding its Composition
“The aim of Allianz sE’s Supervisory Board is to have members who are equipped with
the necessary skills and competence to properly supervise and advise Allianz sE’s
management. Supervisory Board candidates should possess the professional expertise
and experience, integrity, motivation and commitment, independence and personality
required to successfully carry out the responsibilities of a Supervisory Board member
in a financial-services institution with international operations. To promote additional
cooperation among Supervisory Board members, care should be taken in selecting the
candidates to ensure that adequate attention is paid to ensuring diversity in occupa-
tional backgrounds, professional expertise and experience.
Employee representation within Allianz sE, as provided for by the sE Agreement con-
cerning the Participation of Employees dated 3 July 2014, contributes to diversity of
work experience and cultural background. Pursuant to § 6 (2) sentence 2 of the Act on
the Participation of Employees in a European Company (sEBG), the number of women
and men appointed as German employee representatives should be proportional to
the number of women and men working in the German companies. However, the
Supervisory Board does not have the right to select the employee representatives.
The following requirements and objectives apply to the composition of Allianz sE’s
Supervisory Board:1
I.
Requirements relating to the individual members
of the Supervisory Board
1. General selection criteria
– Managerial or operational experience
– General knowledge of the insurance and financial services business
– Willingness and ability to make sufficient commitments on substance
– Fulfillment of the regulatory requirements, in particular1:
– Reliability
– Knowledge of the field of corporate governance and supervisory law
– Knowledge of the main features of accounting and risk management
Compliance with the limitation on the number of mandates as recommended by
the German Corporate Governance Code and required by § 24 (4) of the German
Insurance Supervision Act 2016 (“Versicherungsaufsichtsgesetz – vaG”).
–
2. Independence
At least eight members of the Supervisory Board should be independent as defined
by No. 5.4.2 of the Corporate Governance Code, i.e. they may not have any business
or personal relations with Allianz sE or its Executive Bodies, a controlling shareholder
or an enterprise associated with the latter, which may cause a substantial and not
merely temporary conflict of interests. In case shareholder representatives and
employee representatives are viewed separately, at least four members should be
independent within the meaning of No. 5.4.2 of the Corporate Governance Code.
Regarding employee representatives, however, the mere fact of employee repre-
sentation and the existence of a working relationship with the company shall not
itself affect independence.
It must be taken into account that the possible emergence of conflicts of interest in
individual cases cannot, as a general rule, be excluded. Potential conflicts of interest
must be disclosed to the chairman of the Supervisory Board and will be resolved by
appropriate measures.
3. Time of availability
Each member of the Supervisory Board must ensure that it has sufficient time to
dedicate to the proper fulfilment of the Supervisory Board mandate. It has to be taken
into account that
–
there at least four, but usually six ordinary Supervisory Board meetings per year,
each of which requires adequate preparation;
sufficient time has to be dedicated for the audit of the annual and consolidated
financial statements;
attendance of the General Meeting is required;
–
–
–
–
depending on possible memberships in one or more of the currently five
Supervisory Board committees, extra time planning to participate in the
committee meetings and to prepare for such meetings is required; this applies in
particular to the Audit and Risk Committees;
extraordinary meetings of the Supervisory Board or of a committee may be
necessary to deal with special matters.
4. Retirement age
Members of the Supervisory Board may not, in general, be older than 70 years of age.
5. Term of membership
The continuous period of membership for any member of the Supervisory Board
should, as a rule, not exceed 15 years.
II. Requirements relating to the composition of the Board as a whole
1. Specialist knowledge
–
Make certain that the members in their entirety are familiar with the insurance
and financial-services industry as defined under Article 100 (5) of the German Stock
Corporation Act (AktG).
At least one member must have considerable experience in the insurance and
financial-services fields
At least one member must have expert knowledge of accounting and auditing as
defined by § 100 (5) of the German Stock Corporation Act.
–
–
– Specialist knowledge of, or experience in, other economic sectors.
2. International character
At least four of the members must, on the basis of their origin or function, represent
regions or cultural areas in which Allianz sE conducts significant business.
At Allianz sE as a Societas Europaea (European Company), Allianz employees from
different Member States of the E.u. are considered in the distribution of Supervisory
Board seats for employee representatives, according to the Agreement concerning the
Participation of Employees in Allianz sE dated 3 July 2014.
3. Diversity and appropriate representation of women
The members of the Supervisory Board shall complement one another regarding their
background, professional experience and specialist knowledge, in order to provide the
Supervisory Board with the most diverse sources of experience and specialist
knowledge possible.
The Supervisory Board shall be composed of at least 30 % women and at least 30 % men.
The representation of women is generally considered to be the joint responsibility of
the shareholder and employee representatives.“
1
For further details, please see BaFin Guidance Notice on Vetting Members of Administrative and Super-
visory Bodies in accordance with the German Banking Act and the German Insurance Supervision Act in
its respective effective version.
30
Annual Report 2016
Allianz sE
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Management Report of Allianz se
Accounting and auditing
The Allianz Group prepares its accounts according to § 315a of the
German Commercial Code (“Handelsgesetzbuch – HGB”) on the basis
of International Financial Reporting Standards (IFRS) as adopted
within the European Union. The annual financial statements of
Allianz SE are prepared in accordance with German law, in particular
the HGB.
In compliance with special legal provisions that apply to insu-
rance companies, the auditor of the annual financial statements and
of the half-yearly financial report is appointed by the Supervisory
Board, and not by the AGM. The audit of the financial statements
co vers the individual financial statements of Allianz SE and also the
consolidated financial statements of the Allianz Group.
To ensure maximum transparency, we inform our shareholders,
financial analysts, the media and the general public about the com-
pany’s situation on a regular basis and in a timely manner. The annu-
al financial statements of Allianz SE, the Allianz Group’s consolidated
financial statements and the respective management reports are
published within 90 days of the end of each financial year. Additional
information is provided in the Allianz Group’s half-yearly financial
reports and quarterly statements. Information is also made available
at the AGM, at press and analysts’ conferences, as well as on the Allianz
Group’s website. Our website also provides a financial calendar list-
ing the dates of major publications and events, such as an nual
reports, quarterly statements and half-yearly financial reports, AGMs
as well as analyst conference calls and Financial press conferences.
You can find the 2017 financial calendar on our website at
www.allianz.com/financialcalendar.
Regulatory requirements
The regulatory requirements for corporate governance as set out in
Solvency II are additionally important. These requirements, which
became effective as of 1 January 2016, include, in particular, the estab-
lishment and further design of significant control functions (risk
management, actuarial function, compliance and internal audit) as
well as general principles for a sound business organization. The
regulatory requirements are applicable throughout the Group and
have been implemented using written guidelines issued by the Board
of Management of Allianz SE. For the financial year 2016 it was
required to prepare for the first time a market value balance sheet at
the individual and Group level, for this to be audited by the auditor
and separately reported on.
The composition of the Supervisory Board of Allianz SE reflects these
objectives. It has an appropriate number of independent members
with international backgrounds. With four female Supervisory Board
members, the current legislation for equal participation of women
and men in leadership positions (statutory gender quota of 30 %) is
being met. The current composition of the Supervisory Board and its
page 5.
committees is described on
Shares held by members of the Board of
Management and the Supervisory Board
The total holdings of members of the Board of Management and the
Supervisory Board of Allianz SE amounted to less than 1 % of the com-
pany’s issued shares as of 31 December 2016.
Directors’ dealings
Members of the Board of Management and the Supervisory Board are
obliged by the E.U. Market Abuse Directive to disclose to both Allianz SE
and the German Federal Financial Supervisory Authority any trans-
actions involving shares or debt securities of Allianz SE or financial
derivatives or other instruments based on them as soon as the value
of the securities acquired or divested by the member amounts to five
thousand Euros or more within a calendar year. These disclosures are
published on our website at
www.allianz.com/directorsdealings.
Annual General Meeting
Shareholders exercise their rights at the Annual General Meeting.
When adopting resolutions, each share carries one vote. Sharehol-
ders can follow the AGM’s proceedings on the internet and be repre-
sented by proxies. These proxies exercise voting rights exclusively on
the basis of instructions given by the shareholder. Shareholders are
also able to cast their votes via the internet in the form of online voting.
Allianz SE regularly promotes the use of internet services.
The AGM elects the shareholder representatives of the Super-
visory Board and approves the actions taken by the Board of Manage-
ment and the Supervisory Board. It decides on the use of profits,
capital transactions and the approval of intercompany agreements,
as well as the remuneration of the Supervisory Board and changes to
the company’s Statutes. In accordance with European regulations
and the Statutes, changes to the Statutes require a two-thirds majo-
rity of votes cast in case less than half of the share capital is repre-
sented in the AGM. Each year, an ordinary AGM takes place at which
the Board of Management and Supervisory Board give an account of
the preceding financial year. For special decisions, the German Stock
Corporation Act provides for the convening of an extraordinary AGM.
Annual Report 2016
Allianz sE
31
B
Management Report of Allianz Se
Statement on Corporate Manage ment
pursuant to § 289a of the HGB
The Statement on Corporate Management pursuant to § 289a of the
German Commercial Code (“Handelsgesetzbuch – HGB”) forms part
of the Management Report. According to § 317 (2), sentence 4 of the
HGB, this Statement does not have to be included within the scope of
the audit.
Declaration of Conformity with the
German Corporate Governance Code
On 15 December 2016, the Board of Management and the Supervisory
Board issued the following Declaration of Conformity of Allianz SE
with the German Corporate Governance Code (hereinafter the “Code”):
Declaration of conformity in accorDance
with § 161 of the German Stock corporation act
“Declaration of Conformity by the Management Board and the Supervisory Board of
Allianz SE with the recommendations of the German Corporate Governance Code
Commission in accordance with § 161 of the German Stock Corporation Act (AktG)
Since the last Declaration of Conformity as of December 10, 2015, Allianz SE has
complied with all recommendations of the German Corporate Governance Code
in the version of May 5, 2015 and will comply with them in the future.
Munich, December 15, 2016
Allianz SE
For the Board of Management:
Signed Oliver Bäte
Signed Dr. Helga Jung
For the Supervisory Board:
Signed Dr. Helmut Perlet”
In addition, Allianz SE follows all the suggestions of the Code in its
5 May 2015 version.
The Declaration of Conformity and further information on cor
www.
porate governance at Allianz can be found on our website at
allianz.com/corporate-governance.
Corporate governance practices
INTERNAL CONTROL SYSTEMS
Allianz SE as member of the Allianz Group has an effective internal
control system for verifying and monitoring its operating activities
and business processes, in particular the control of financial report
ing. The requirements placed on the internal control systems are
essential not only for the survival of the company, but also to main
tain the confidence of the capital market, our customers and the pub
lic. A comprehensive risk management system regularly assesses the
appropriateness of the internal control system, taking into account
not only qualitative and quantitative guidelines, but also specific
controls for individual business activities. For further information on
page 19
the risk organization and risk principles, please refer to
and 20. Information on the internal Controls over Financial Reporting
you will find on
page 48.
In addition, the quality of the internal control system is assessed
by the internal audit staff. Internal Audit conducts independent audit
procedures, analyzing the structure and efficacy of the internal con
trol systems as a whole. In addition, it also examines the potential for
additional value and improvement of our organization’s operations.
Fully compliant with all international auditing principles and stan
dards, Internal Audit contributes to the evaluation and improvement
of the effectiveness of the risk management, control and governance
processes. Therefore, internal audit activities are geared towards
helping the company to mitigate risks and further assist in strengthe
ning its governance processes and structures.
COMPLIANCE PROGRAM
The sustained success of Allianz SE and the Allianz Group is based on
the responsible behavior of all employees, who embody trust, respect
and integrity. The compliance program of Allianz SE is part of the cen
tral compliance program of Allianz Group. The central compliance
function of Allianz SE coordinates the global compliance programs to
ensure that nationally and internationally recognized guidelines and
standards for rulescompliant and valuebased corporate gover
nance are supported and followed. These include the principles of the
United Nations (UN Global Compact), the Guidelines of the Organiza
tion for Economic Cooperation and Development for Multinational
Enterprises (OECD guidelines), and European and international stan
dards on data and consumer protection, economic and financial
sanctions and combating corruption, bribery, money laundering and
terrorism financing. Through its support for and acceptance of these
standards, Allianz aims to avoid the risks that might arise from non
compliance. The central compliance function of Allianz SE is respon
sible – in close cooperation with regional, divisional and local com
pliance functions – for ensuring the effective implementation and
monitoring of the compliance program as well as for investigating
potential compliance infringements.
The standards of conduct established by the Code of Conduct for
Business Ethics and Compliance are obligatory for all employees. The
www.allianz.com/
Code of Conduct is available on our website at
corporate-governance.
32
Annual Report 2016
Allianz SE
B
Management Report of Allianz Se
German Act on Equal Participation
of Women and Men in Executive Positions
in the Private and the Public Sector
To implement the German Act on Equal Participation of Women and
Men in Executive Positions in the Private and the Public Sector,
Allianz SE has set the following objectives for the proportion of
wo men on the Board of Management and the two management levels
below the Board of Management, which are to be achieved by 30 June
2017:
For the proportion of women on Allianz SE’s Board of Manage
ment, the Supervisory Board in August 2015 set a target of 11 %. In
addition, the Supervisory Board declared its intention to increase the
proportion of women on the Board of Management to at least 20 % by
the end of 2018. With the appointment of Jacqueline Hunt effective
1 July 2016, the proportion of women on the Board of Management
currently accounts for 22 %, therefore even fulfilling this additional
objective.
As regards the proportion of women on the first and the second
management level below the Board of Management of Allianz SE, the
Board of Management has set a target quota of at least 20 %. Over the
longer term, Allianz is aiming for at least 30 % of positions on these
two management levels to be held by women.
§ 17 (2) of the SE Implementation Act (“SEAusführungsgesetz”)
states that the Supervisory Board of Allianz SE must be composed of
at least 30 % of both women and men as of 1 January 2016. With its four
female members, this requirement is met by the current Supervisory
Board in office (33 %). In case the Annual General Meeting 2017 elects
the Supervisory Board in accordance with the election nominations
of the Supervisory Board, this requirement will also be met in the
future.
The Code of Conduct and the internal guidelines derived from it
provide all employees with clear guidance on behavior that lives up
to the values of the Allianz Group. In order to transmit the principles
of the Code of Conduct and the internal compliance program based
on these principles, the compliance function of Allianz SE, together
with regional, divisional and local compliance functions has imple
mented interactive training programs around the world. These pro
vide practical guidelines which enable employees to come to their
own decisions. The Code of Conduct also forms the basis for guide
lines and controls to ensure fair dealings with Allianz Group custo
mers (sales compliance).
There are legal provisions against corruption and bribery in
almost all countries in which Allianz has a presence. The global Anti
Corruption Program of the Allianz Group ensures the continuous
monitoring and improvement of the internal anticorruption con
trols. More information on the AntiCorruption Program can be found
www.allianz.com/
in the Sustainability Report on our website at
sustainability.
A major component of the compliance program is a whistle
blower system that allows employees to alert the compliance depart
ment confidentially about irregularities. No employee voicing con
cerns about irregularities in good faith needs to fear retribution, even
if the concerns turn out to be unfounded at a later date.
DESCRIPTION OF THE FUNCTIONS OF THE BOARD
OF MANAGEMENT AND THE SUPERVISORY BOARD
AND OF THE COMPOSITION AND FUNCTIONS
OF THEIR COMMITTEES
A description of the composition of the Supervisory Board and its
page 5 and 7 of the Annual Report. A
committees can be found on
description of the composition of the Board of Management can be
page 8, while the composition of the Committees of the
found on
Board of Management is described in the Corporate Governance
page 27. This information is also available on
Report starting on
our website at
www.allianz.com/corporate-governance.
A general description of the functions of the Board of Manage
ment, the Supervisory Board and their committees can be found in
page 27, and on our
the Corporate Governance Report starting on
website at
www.allianz.com/corporate-governance.
Annual Report 2016
Allianz SE
33
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Management Report of Allianz SE
Remuneration Report
This report covers the remuneration arrangements for the Board of
Management and the Supervisory Board of Allianz SE.
Allianz SE Board of Management
remuneration
GOVERNANCE SYSTEM
The remuneration of the Board of Management is decided upon by
the entire Supervisory Board, based on proposals prepared by the
Personnel Committee. If required, outside advice is sought from
independent external consultants. The Personnel Committee and
the Supervisory Board consult with the Chairman of the Board of
Management, as appropriate, in assessing the performance and
remuneration of members of the Board of Management. The Chair-
man of the Board of Management is not present when his own remu-
neration is discussed. Regarding the activities and decisions taken by
the Personnel Committee and the Supervisory Board, please refer to
the Supervisory Board Report starting on
page 2.
REMUNERATION PRINCIPLES AND MARKET POSITIONING
The key principles of Board of Management remuneration are as
follows:
− Support of the Group’s strategy: Performance targets reflect the
Allianz Group’s business strategy.
− Alignment of pay and performance: The performance-based,
variable component forms a significant portion of the overall
remuneration.
− Variable remuneration focused on sustainability and aligned with
shareholder interests: Two thirds of the variable remuneration
reflect longer-term performance. One third is a deferred payout
after three years, based on a sustainability assessment covering
the three-year period. The other third rewards the sustained per-
formance of the share price with a deferred payout four years
after grant.
The structure, weighting and level of the Allianz SE Board of Manage-
ment remuneration is decided upon by the Supervisory Board. Remu-
neration survey data of DAX 30 companies and international insu-
rance peers is provided by external consultants. Compensation levels
are around the third quartile of this group, which we deem appropriate
given the relative size, complexity and sustained performance of
Allianz within that peer group. The structure of the remuneration is
more strongly weighted towards variable, longer-term components
than it is in most DAX 30 companies. Remuneration and benefit
arrangements are also periodically compared with best practices. In
addition, the Supervisory Board takes into account remuneration
levels within the Allianz Group when reviewing the adequateness and
appropriateness of the Board of Management’s remuneration.
REMUNERATION STRUCTURE,
COMPONENTS AND TARGET SETTING PROCESS
There are four main remuneration components. Each has the same
weighting within annual target remuneration: base salary, annual
bonus, annualized mid-term bonus (MTB), and equity-related remu-
neration. The target compensation of each variable component does
not exceed the base salary, with the total target variable compensation
not exceeding three times the base salary. In addition, Allianz offers
pensions and similar benefits and perquisites.
BASE SALARY
The base salary is the fixed remuneration component, expressed as
an annual cash sum and paid in twelve monthly installments.
VARIABLE REMUNERATION
Variable remuneration is designed to balance short-term perfor-
mance, longer-term success and sustained value creation. Each year,
the Supervisory Board agrees with members of the Board of Manage-
ment on performance targets for the variable remuneration com-
ponent. These are documented for the upcoming financial year.
Every three years, the MTB sustainability criteria, as described on
page 35, are set for the following mid-term period. All variable
awards are made under the rules and conditions of the “Allianz Sus-
tained Performance Plan” (ASPP). The grant of variable remuneration
components is related to performance and can vary between 0 % and
150 % of the respective target values. If performance was rated at 0 %
no variable component would be granted. Consequently, the mini-
mum total direct compensation for a regular member of the Board of
Management equals the base salary of € 750 Thou (excluding perqui-
sites and pension contributions). The maximum total direct com-
pensation (excluding perquisites and pension contributions) is
€ 4,125 Thou: base salary € 750 Thou plus € 3,375 Thou (150 % of the sum
of all three variable compensation components at target).
Details on the variable compensation components:
− Annual bonus (short-term): A cash payment which rewards the
achievement of quantitative and qualitative targets for the
respective financial year and is paid in the year following the per-
formance year. Under the “Inclusive Meritocracy” approach, the
cultural change element of the Renewal Agenda, Group-related
targets account for 50 % (equally divided between annual operat-
ing profit and annual net income). The other 50 % are linked to
individual performance, which consists of quantitative and qua-
litative criteria. For members of the Board of Management with
business division responsibilities, respective quantitative targets
comprise operating profit, net income, Property-Casualty reve-
nues and Life New Business Value. For members of the Board of
Management with a functional focus, the divisional quantitative
targets are determined based on their key responsibilities. The
Chairman of the Allianz SE Board of Management does not have
divisional quantitative targets. In all cases, the personal contribu-
tion to the Renewal Agenda is assessed alongside behavioral
34
Annual Report 2016
Allianz SE
aspects. The latter is framed in a common standard (“People Let-
ter”) designed to drive cultural change across the Group, namely:
− Customer and Market Excellence,
− Collaborative Leadership,
− Entrepreneurship,
− Trust.
To support the assessment of People Letter behaviors, a so-called
“multi-rater” process has been introduced. Each member of the
Board of Management collects feedback from the Chairman of
the Allianz SE Board of Management, the other Board members
and direct reports. The resulting analysis supports the assess-
ment of the behavioral part of performance and additionally
provides a sound basis for feedback and personal development
discussions. Based on the 2016 target achievement for the Group,
the business division/corporate functions, and the qualitative
performance, the total annual bonus awards ranged between
100 % and 131 % of the target, with an average bonus award of 123 %
of the target.
− MTB (mid-term): A deferred award which reflects the achieve-
ment of the annual targets by accruing an amount identical to
the annual bonus. The payout of the award at the end of a three-
year cycle is subject to a sustainability assessment for these three
years. The MTB 2016 – 2018 comprises sustainability (performance
and health) indicators, which are aligned with the Group’s external
targets:
Performance indicators:
− Sustainable improvement/stabilization of Return on Equity
(Return on Equity excluding unrealized gains/losses on
bonds net of shadow accounting),
− Compliance with economic capitalization guidance (capi-
talization level and volatility limit);
Health indicators (aligned with the Renewal Agenda):
− True Customer Centricity,
− Digital by Default,
− Technical Excellence,
− Growth Engines,
− Inclusive Meritocracy (including gender diversity – women
in leadership).
− Equity-related remuneration (long-term): A virtual share award,
known as “Restricted Stock Units” (RSus). The grant value of the
RSus allocated equals the annual bonus of the performance year.
The number of RSus allocated is derived from dividing the grant
value by the fair market value of an RSu at the time of grant.
The fair market value is calculated based on the ten-day
average Xetra closing price of the Allianz stock following the
financial press conference on the annual results. As RSus are vir-
tual stocks without dividend payments, the average Xetra closing
price is reduced1 by the net present value of the expected future
dividend payments during the vesting period. The expected divi-
dend stream is discounted with the respective swap rates as of
B
Management Report of Allianz SE
the valuation day. Following the end of the four-year vesting
period, the company makes a cash payment based on the number
of RSus granted and the ten-day average Xetra closing price of the
Allianz stock following the annual financial press conference in
the year of expiry of the respective RSu plan. The RSu payout is
capped at 200 % above grant price to avoid extreme payouts2. Out-
standing RSu holdings are forfeited should a Board member leave
at his/her own request or be terminated for cause.
Variable remuneration components may not be paid, or payment
may be restricted, in the case of a breach of the Allianz Code of Con-
duct, risk limits, or compliance requirements. Additionally, a reduc-
tion or cancellation of variable remuneration may occur if the super-
visory authority (BaFin) requires this in accordance with its statutory
powers.
PENSIONS AND SIMILAR BENEFITS
To provide competitive and cost-effective retirement and disability
benefits, company contributions to the current pension plan “My
Allianz Pension” are invested in a fund with a guarantee for the con-
tributions paid, but no further interest guarantee. On retirement, the
accumulated capital is paid out as lump sum or can be converted into
a lifetime annuity. Each year the Supervisory Board decides whether
and to what extent a budget is provided, also taking into account the
targeted pension level. This budget includes a risk premium paid to
cover death and disability. The earliest age a pension can be drawn is
62, except for cases of occupational or general disability for medical
reasons. In these cases, it may become payable earlier and an
increase by projection may apply. In the case of death, a lump sum,
which can be converted into an annuity, will be paid to dependents.
Should Board membership cease before retirement age for other
reasons, the accrued pension rights are maintained if vesting require-
ments are met.
For members of the Allianz SE Board of Management who were
born before 1 January 1958, and for the rights accrued before 2015, the
guaranteed minimum interest rate remains at 2.75 % and the retire-
ment age is still 60.
From 1 January 2005 until 31 December 2014, most Board of Man-
age ment members have participated in a contribution-based system
which was frozen as of 31 December 2014 and is now only co vering
disability and death. Before 2005 a defined benefit plan provided fixed
benefits which were not linked to base salary increases. Benefits gen-
erated under this plan were frozen at the end of 2004. Additionally,
most Board members participated in the Allianz Ver sorgungskasse
VVaG, a contribution-based pension plan, and the Allianz Pensions-
verein e.V. which were closed for new entries as of 1 January 2015.
PERQUISITES
Perquisites mainly consist of contributions to accident and liability
insurances and the provision of a company car. Perquisites are not
linked to performance. Each member of the Board of Management is
responsible for the income tax on these perquisites. The Supervisory
Board regularly reviews the level of perquisites.
1
The fair market value of the RSUs is further subject to a small reduction of a few Euro cents due to the
200 % cap on the RSU payout. This reduction is calculated based on a standard option pricing formula.
2
The relevant share price used to determine the final number of RSUs granted and the 200 % cap is available
only after sign-off by the external auditors.
Annual Report 2016
Allianz SE
35
B
Management Report of Allianz SE
REMUNERATION FOR 2016
The following remuneration disclosure is based on and compliant
with the German Corporate Governance Code and shows the indi-
vidual Board members’ remuneration for 2015 and 2016, including
fixed and variable remuneration and pension service cost. The
“Grant” column below shows the remuneration at target and mini-
mum and maximum levels. The “Payout” column discloses the 2015
and 2016 payments. The base salary, annual bonus and perquisites
are linked to the reported performance years 2015 and 2016, whereas
the Group Equity Incentive (GEI) and Allianz Equity Incentive (AEI)
payouts result from grants related to the performance years
2008 – 2011. To enhance transparency remuneration related to the
performance year 2016, the additional column “Actual grant” includes
the 2016 fixed compensation, the annual bonus paid for 2016, the MTB
2016 – 2018 tranche accrued for the performance year 2016, and the
fair value of the RSu grant in 2017 for the performance year 2016.
IndIvIdual rEmunEratIon: 2016 and 2015
€ Thou (total might not sum up due to rounding)
Base Salary
Perquisites
Total fixed compensation
Annual Variable Compensation
Annual Bonus
Deferred Compensation
MTB (2016 – 2018)2
MTB (2013 – 2015)3
AEI 2017/RSu4
AEI 2016/RSu4
AEI 2012/RSu4
AEI 2011/RSu4
GEI 2010/RSu4
GEI 2010/SAR5
GEI 2008/SAR5
Total
Pensions Service Cost6
Total
Oliver Bäte7 (Appointed: 01/2008; CEo since 05/2015)
Sergio Balbinot8 (Appointed: 01/2015)
Jacqueline Hunt9 (Appointed: 07/2016)
2015
Target
994
15
1,009
Grant
Target
1,125
30
1,155
2016
Min
1,125
30
1,155
Max
1,125
30
1,155
Actual
Grant
2016
1,125
30
1,155
Payout1
2015
2016
994
15
1,009
1,125
30
1,155
Grant
2016
Target
750
32
782
Min
750
32
782
2015
Target
750
33
783
996
1,125
1,688
1,474
1,260
1,474
750
750
1,125
983
999
983
566
456
–
–
–
–
–
–
–
–
–
–
1,688
–
1,688
1,474
–
1,474
–
–
–
–
–
–
–
–
–
–
–
–
4,530
625
5,155
1,155
625
1,780
6,219
625
6,844
5,576
625
6,201
1,125
–
1,125
–
–
–
–
–
–
–
996
–
996
–
–
–
–
–
3,997
483
4,480
–
3,516
–
–
–
1,704
916
–
263
8,668
483
9,151
–
–
–
–
1,334
–
–
–
–
3,963
625
4,588
1
2
3
4
5
In accordance with the German Corporate Governance Code, the annual bonus disclosed for perfor-
mance year 2016 is paid in 2017 and for performance year 2015 in 2016. The payments for equity related
deferred compensation (GEI and AEI), however, are disclosed for the year in which the actual payment
was made.
The MTB figure included in the “Actual Grant” column shows the annual accrual.
The payout 2015 figure includes the 2015 allocation and the accruals from the performance years 2013
and 2014, as adjusted by the sustainability assessment. The MTB 2013 – 2015 was paid out in spring 2016.
Payout is capped at 200 % above grant price. The relevant share price used to determine the fair market
value, and hence the final number of RSUs granted, and the 200 % cap are only available after sign-off by
the external auditors.
The equity-related remuneration that applied before 2010 consisted of two vehicles, virtual stock awards
known as RSUs and virtual stock options known as “Stock Appreciation Rights” (SAR). Only RSUs have been
awarded as of 1 January 2010. The remuneration system valid until December 2009 is disclosed in the
Annual Report 2009 (starting on page 17). Whereas the GEI/RSU grants are automatically exercised at the
vesting date, the GEI/SAR grants are exercised by the Board member within the exercise period following
the vesting date. Hence, the total payout from SARs depends on the individual decision by the Board
member. SARs are released to plan participants upon expiry of the vesting period, assuming all other
exercise hurdles are met. For SARs granted until and including 2008, the vesting period was two years and
the exercise period five years. SARs can be exercised on the condition that the price of the Allianz SE stock
is at least 20 % above the strike price at the time of grant. During the term of the plan, at least once on five
consecutive trading days the Allianz SE stock must relatively appreciate at least 0.01 percentage points
ahead of the appreciation of the Dow Jones EURO STOXX Price Index (600).
Pension Service Cost in accordance with IAS 19: represents the company cost not the actual entitlement
nor a payment, however, according to the German Corporate Governance Code the Pension Service Cost
is to be included in all columns.
6
36
Annual Report 2016
Allianz SE
Actual
Grant
2016
Payout1
2015
2016
Max
750
32
782
1,125
1,125
–
–
–
–
–
–
–
–
–
–
–
–
–
–
–
–
–
750
32
782
983
983
–
–
–
–
–
–
–
750
33
783
999
–
–
–
–
–
–
–
–
750
32
782
–
–
–
–
–
–
–
–
–
Grant
20 16
2015
Target
Target
375
136 10
511
Min
375
136 10
511
Max
375
136 10
511
Actual
Grant
2016
375
136 10
511
377
377
377
–
–
–
–
–
–
–
–
–
–
–
–
–
–
–
–
–
566
566
–
–
–
–
–
–
–
456
456
–
–
–
–
–
–
–
–
–
–
–
–
–
–
–
–
–
–
–
–
–
–
–
Payout1
2015
2016
–
–
–
–
–
–
–
–
–
–
–
–
–
–
–
–
375
136 10
511
456
–
–
–
–
–
–
–
–
–
967
159
1,126
3,033
222
3,255
3,032
365
3,397
782
365
1,147
4,157
365
4,522
3,730
365
4,095
2,781
222
3,003
1,765
365
2,130
1,642
159
1,801
511
159
670
2,209
159
2,368
1,880
159
2,039
7
For performance year 2015, Oliver Bäte’s base salary and his target for the annual bonus, the MTB tranche,
9
Jacqueline Hunt joined Allianz on 1 July 2016. She received a pro-rated base salary, annual bonus, MTB
and equity-related compensation are disclosed based on his pro-rated base salary of € 750 ThOU until
tranche, and equity-related compensation. The different pro-rated amounts for base salary and target
6 May 2015 and his pro-rated base salary of € 1,125 ThOU from 7 May 2015. The different pro-rated
amounts result from different pro-rating methodologies, which are generally applied. In addition to the
amounts for base salary and target amounts result from different pro-rating methodologies, which are
amounts disclosed in the table, Jacqueline Hunt received a buyout award of € 170 ThOU to compensate
generally applied.
for forfeited grants from her previous employer.
8
In addition to the amounts disclosed in the table, Sergio Balbinot received a buyout award of € 6 Mn to
10
Jacqueline Hunt received an off-cycle one time payment of € 120 ThOU to reimburse her for relocation
compensate for forfeited grants from his previous employer: € 3 Mn in cash and € 3 Mn in RSUs. 50 % of
cost.
the cash amount was paid in February 2015 and 50 % was paid in 2016 and are subject to clawback.
750
750
–
–
–
–
–
–
–
750
750
–
–
–
–
–
–
–
B
Management Report of Allianz SE
IndIvIdual rEmunEratIon: 2016 and 2015
€ Thou (total might not sum up due to rounding)
Base Salary
Perquisites
Total fixed compensation
Annual Variable Compensation
Annual Bonus
Deferred Compensation
MTB (2016 – 2018)2
MTB (2013 – 2015)3
AEI 2017/RSu4
AEI 2016/RSu4
AEI 2012/RSu4
AEI 2011/RSu4
GEI 2010/RSu4
GEI 2010/SAR5
GEI 2008/SAR5
Total
Total
Pensions Service Cost6
Target
1,125
30
1,155
1,125
1,125
–
–
–
–
–
–
–
2015
Target
994
15
1,009
996
996
–
–
–
–
–
–
–
3,997
483
4,480
–
–
–
–
–
–
–
–
–
–
1,688
1,474
1,688
1,474
–
–
–
–
–
–
–
–
–
–
–
–
–
–
4,530
625
5,155
1,155
625
1,780
6,219
625
6,844
5,576
625
6,201
–
–
–
–
–
3,516
1,704
916
263
8,668
483
9,151
–
–
–
–
–
–
–
–
1,334
3,963
625
4,588
Oliver Bäte7 (Appointed: 01/2008; CEo since 05/2015)
Sergio Balbinot8 (Appointed: 01/2015)
Jacqueline Hunt9 (Appointed: 07/2016)
Grant
2016
Min
1,125
30
1,155
Max
1,125
30
1,155
Actual
Grant
2016
1,125
30
1,155
Payout1
2015
2016
994
15
1,009
1,125
30
1,155
Grant
2016
Target
750
32
782
Min
750
32
782
Max
750
32
782
2015
Target
750
33
783
Actual
Grant
2016
750
32
782
Payout1
2015
2016
750
33
783
750
32
782
996
1,125
1,688
1,474
1,260
1,474
750
750
–
750
–
750
–
–
–
–
–
750
–
750
–
–
–
–
–
–
–
–
–
–
–
–
–
–
–
–
1,125
983
999
983
1,125
–
1,125
–
–
–
–
–
–
983
–
983
–
–
–
–
–
–
–
999
–
–
–
–
–
–
–
–
–
–
–
–
–
–
–
–
was made.
2
3
1
In accordance with the German Corporate Governance Code, the annual bonus disclosed for perfor-
Annual Report 2009 (starting on page 17). Whereas the GEI/RSU grants are automatically exercised at the
mance year 2016 is paid in 2017 and for performance year 2015 in 2016. The payments for equity related
vesting date, the GEI/SAR grants are exercised by the Board member within the exercise period following
deferred compensation (GEI and AEI), however, are disclosed for the year in which the actual payment
the vesting date. Hence, the total payout from SARs depends on the individual decision by the Board
member. SARs are released to plan participants upon expiry of the vesting period, assuming all other
The MTB figure included in the “Actual Grant” column shows the annual accrual.
exercise hurdles are met. For SARs granted until and including 2008, the vesting period was two years and
The payout 2015 figure includes the 2015 allocation and the accruals from the performance years 2013
the exercise period five years. SARs can be exercised on the condition that the price of the Allianz SE stock
and 2014, as adjusted by the sustainability assessment. The MTB 2013 – 2015 was paid out in spring 2016.
is at least 20 % above the strike price at the time of grant. During the term of the plan, at least once on five
4
Payout is capped at 200 % above grant price. The relevant share price used to determine the fair market
consecutive trading days the Allianz SE stock must relatively appreciate at least 0.01 percentage points
value, and hence the final number of RSUs granted, and the 200 % cap are only available after sign-off by
ahead of the appreciation of the Dow Jones EURO STOXX Price Index (600).
the external auditors.
6
Pension Service Cost in accordance with IAS 19: represents the company cost not the actual entitlement
5
The equity-related remuneration that applied before 2010 consisted of two vehicles, virtual stock awards
nor a payment, however, according to the German Corporate Governance Code the Pension Service Cost
known as RSUs and virtual stock options known as “Stock Appreciation Rights” (SAR). Only RSUs have been
is to be included in all columns.
awarded as of 1 January 2010. The remuneration system valid until December 2009 is disclosed in the
3,033
222
3,255
3,032
365
3,397
782
365
1,147
4,157
365
4,522
3,730
365
4,095
2,781
222
3,003
1,765
365
2,130
7
8
For performance year 2015, Oliver Bäte’s base salary and his target for the annual bonus, the MTB tranche,
and equity-related compensation are disclosed based on his pro-rated base salary of € 750 ThOU until
6 May 2015 and his pro-rated base salary of € 1,125 ThOU from 7 May 2015. The different pro-rated
amounts for base salary and target amounts result from different pro-rating methodologies, which are
generally applied.
In addition to the amounts disclosed in the table, Sergio Balbinot received a buyout award of € 6 Mn to
compensate for forfeited grants from his previous employer: € 3 Mn in cash and € 3 Mn in RSUs. 50 % of
the cash amount was paid in February 2015 and 50 % was paid in 2016 and are subject to clawback.
Grant
20 16
Target
375
136 10
511
Min
375
136 10
511
Max
375
136 10
511
Actual
Grant
2016
375
136 10
511
377
377
–
377
–
–
–
–
–
–
–
–
–
–
–
–
–
–
–
–
566
456
566
–
566
–
–
–
–
–
–
456
–
456
–
–
–
–
–
–
1,642
159
1,801
511
159
670
2,209
159
2,368
1,880
159
2,039
2015
Target
–
–
–
–
–
–
–
–
–
–
–
–
–
–
–
–
Payout1
2015
2016
–
–
–
–
–
–
–
–
–
–
–
–
–
–
–
–
375
136 10
511
456
–
–
–
–
–
–
–
–
–
967
159
1,126
9
10
Jacqueline Hunt joined Allianz on 1 July 2016. She received a pro-rated base salary, annual bonus, MTB
tranche, and equity-related compensation. The different pro-rated amounts for base salary and target
amounts result from different pro-rating methodologies, which are generally applied. In addition to the
amounts disclosed in the table, Jacqueline Hunt received a buyout award of € 170 ThOU to compensate
for forfeited grants from her previous employer.
Jacqueline Hunt received an off-cycle one time payment of € 120 ThOU to reimburse her for relocation
cost.
Annual Report 2016
Allianz SE
37
B
Management Report of Allianz SE
IndIvIdual rEmunEratIon: 2016 and 2015
€ Thou (total might not sum up due to rounding)
Base Salary
Perquisites
Total fixed compensation
Annual Variable Compensation
Annual Bonus
Deferred Compensation
MTB (2016 – 2018)2
MTB (2013 – 2015)3
AEI 2017/RSu4
AEI 2016/RSu4
AEI 2012/RSu4
AEI 2011/RSu4
GEI 2010/RSu4
GEI 2010/SAR5
GEI 2008/SAR5
Total
Pensions Service Cost6
Total
Base Salary
Perquisites
Total fixed compensation
Annual Variable Compensation
Annual Bonus
Deferred Compensation
MTB (2016 – 2018)2
MTB (2013 – 2015)3
AEI 2017/RSu4
AEI 2016/RSu4
AEI 2012/RSu4
AEI 2011/RSu4
GEI 2010/RSu4
GEI 2010/SAR5
GEI 2008/SAR5
Total
Pensions Service Cost6
Total
Dr. Helga Jung (Appointed: 01/2012)
Dr. Christof Mascher (Appointed: 09/2009)
Jay Ralph7 (Appointed: 01/2010; End of service: 06/2016)
2015
Target
750
14
764
Grant
2016
Target
750
14
764
Min
750
14
764
Max
750
14
764
Actual
Grant
2016
750
14
764
Payout1
2015
2016
750
14
764
750
14
764
Grant
2016
Target
750
2
752
Min
750
2
752
2015
Target
750
2
752
Payout1
2015
2016
750
2
752
750
2
752
Grant
20 16
Target
375
11
386
Min
375
11
386
2015
Target
750
19
769
Actual
Grant
2016
Payout1
2015
2016
750
19
769
375
11
386
750
750
1,125
889
758
889
750
750
1,125
870
859
870
750
375
563
375
870
375 7
750
–
750
–
–
–
–
–
–
3,014
420
3,434
1,125
–
1,125
–
–
–
–
–
–
889
–
889
–
–
–
–
–
–
3,430
420
3,850
–
2,534
–
–
–
–
–
–
–
–
–
–
–
–
–
–
–
–
750
750
–
–
–
–
–
–
–
750
750
–
–
–
–
–
–
–
4,056
274
4,330
1,653
420
2,073
3,002
348
3,350
3,002
418
3,420
752
418
1,170
4,127
418
4,545
3,362
418
3,780
3,019
283
3,302
1,511
368
1,879
386
368
754
2,075
368
2,443
1,511
368
1,879
764
420
1,184
4,139
420
4,559
Actual
Grant
2016
750
2
752
870
870
–
–
–
–
–
–
–
750
15
765
954
954
–
–
–
–
–
–
–
Actual
Grant
2016
Max
750
2
752
1,125
1,125
Max
750
15
765
1,125
1,125
–
–
–
–
–
–
–
–
–
–
–
–
–
–
–
–
–
–
–
–
–
–
–
–
–
–
–
–
–
–
–
–
–
–
2,885
–
–
–
–
–
–
1,584
593
6,673
348
7,021
3,156
–
–
–
–
–
–
–
–
1,155
2,777
418
3,195
–
–
–
–
–
–
–
–
–
–
–
–
–
–
–
–
–
750
750
–
–
–
–
–
–
–
375
375
–
–
–
–
–
–
–
750
750
–
–
–
–
–
–
–
750
750
–
–
–
–
–
–
–
Max
375
11
386
563
563
–
–
–
–
–
–
–
Max
750
18
768
1,125
1,125
–
–
–
–
–
–
–
375
11
386
375
375
–
–
–
–
–
–
–
750
18
768
954
954
–
–
–
–
–
–
–
Actual
Grant
2016
–
–
–
–
–
–
–
–
–
–
–
–
–
–
–
–
–
–
–
–
2,784
–
–
–
–
1,520
876
719
–
7,538
283
7,821
375 7
375 7
1,018
–
–
–
–
–
–
2,529
368
2,897
Payout1
2015
2016
750
19
769
750
18
768
3,066
–
–
–
–
1,505
1,225
591
328
8,443
646
9,089
–
–
–
–
–
–
–
–
1,083
2,805
661
3,466
3,016
282
3,298
3,015
479
3,494
765
479
1,244
4,140
479
4,619
3,628
479
4,107
4,883
282
5,165
1,719
479
2,198
3,019
646
3,665
3,018
661
3,679
768
661
1,429
4,143
661
4,804
3,631
661
4,292
7
Jay Ralph left Allianz on 30 June 2016. He received a pro-rated base salary and an amount of € 1,125 ThOU
in lieu of his pro-rated 2016 annual bonus, MTB tranche and equity-related compensation (€ 375 ThOU
each) which was paid in August 2016. According to his separation agreement, he received an amount of
€ 1,000 ThOU in return, specifically, for a non-poaching and non-competition agreement.
Dr. Axel Theis (Appointed: 01/2015)
Dr. Dieter Wemmer (Appointed: 01/2012)
Dr. Werner Zedelius (Appointed: 01/2002)
Grant
2016
Target
750
28
778
Min
750
28
778
Max
750
28
778
Actual
Grant
2016
750
28
778
Payout1
2015
2016
750
27
777
750
28
778
Grant
2016
Target
750
15
765
Min
750
15
765
2015
Target
750
16
766
Payout1
2015
2016
750
16
766
750
15
765
Grant
20 16
Target
750
18
768
Min
750
18
768
2015
Target
750
19
769
1,125
973
956
973
750
750
1,125
954
961
954
750
750
1,125
954
959
954
–
–
–
–
–
–
–
–
–
–
–
–
–
–
–
–
–
–
–
–
–
750
–
750
–
–
–
–
–
3,014
274
3,288
2015
Target
750
27
777
750
750
–
750
–
750
–
–
–
–
–
3,027
397
3,424
750
–
750
–
–
–
–
–
–
3,028
482
3,510
1,125
–
1,125
–
–
–
–
–
–
973
–
973
–
–
–
–
–
–
3,697
482
4,179
–
956
–
–
–
–
–
–
–
2,689
397
3,086
–
–
–
–
–
–
–
–
–
1,751
482
2,233
750
750
–
–
–
–
–
–
–
750
750
–
–
–
–
–
–
–
778
482
1,260
4,153
482
4,635
1
2
3
4
5
In accordance with the German Corporate Governance Code, the annual bonus disclosed for perfor-
mance year 2016 is paid in 2017 and for performance year 2015 in 2016. The payments for equity related
deferred compensation (GEI and AEI), however, are disclosed for the year in which the actual payment
was made.
The MTB figure included in the “Actual Grant” column shows the annual accrual.
The payout 2015 figure includes the 2015 allocation and the accruals from the performance years 2013
and 2014, as adjusted by the sustainability assessment. The MTB 2013 – 2015 was paid out in spring 2016.
Payout is capped at 200 % above grant price. The relevant share price used to determine the fair market
value, and hence the final number of RSUs granted, and the 200 % cap are only available after sign-off by
the external auditors.
The equity-related remuneration that applied before 2010 consisted of two vehicles, virtual stock awards
known as RSUs and virtual stock options known as “Stock Appreciation Rights” (SAR). Only RSUs have been
awarded as of 1 January 2010. The remuneration system valid until December 2009 is disclosed in the
Annual Report 2009 (starting on page 17). Whereas the GEI/RSU grants are automatically exercised at the
vesting date, the GEI/SAR grants are exercised by the Board member within the exercise period following
the vesting date. Hence, the total payout from SARs depends on the individual decision by the Board
member. SARs are released to plan participants upon expiry of the vesting period, assuming all other
exercise hurdles are met. For SARs granted until and including 2008, the vesting period was two years and
the exercise period five years. SARs can be exercised on the condition that the price of the Allianz SE stock
is at least 20 % above the strike price at the time of grant. During the term of the plan, at least once on five
consecutive trading days the Allianz SE stock must relatively appreciate at least 0.01 percentage points
ahead of the appreciation of the Dow Jones EURO STOXX Price Index (600).
Pension Service Cost in accordance with IAS 19: represents the company cost not the actual entitlement
nor a payment, however, according to the German Corporate Governance Code the Pension Service Cost
is to be included in all columns.
6
38
Annual Report 2016
Allianz SE
Dr. Helga Jung (Appointed: 01/2012)
Dr. Christof Mascher (Appointed: 09/2009)
Jay Ralph7 (Appointed: 01/2010; End of service: 06/2016)
Grant
2016
Min
750
14
764
Actual
Grant
2016
Payout1
2015
2016
750
14
764
750
14
764
Grant
2016
Target
750
2
752
Min
750
2
752
Max
750
2
752
2015
Target
750
2
752
Actual
Grant
2016
750
2
752
Payout1
2015
2016
750
2
752
750
2
752
Grant
20 16
Target
375
11
386
Min
375
11
386
Max
375
11
386
2015
Target
750
19
769
Actual
Grant
2016
375
11
386
Payout1
2015
2016
750
19
769
375
11
386
B
Management Report of Allianz SE
750
750
1,125
889
758
889
750
750
–
750
–
750
–
–
–
–
–
750
–
750
–
–
–
–
–
–
–
–
–
–
–
–
–
–
–
–
1,125
–
1,125
–
–
–
–
–
–
870
–
870
–
–
–
–
–
–
1,125
870
859
870
750
375
563
375
870
375 7
–
2,885
–
–
–
1,584
593
–
–
6,673
348
7,021
–
–
–
–
1,155
–
–
–
–
2,777
418
3,195
–
750
–
750
–
–
–
–
–
375
–
375
–
–
–
–
–
–
–
–
–
–
–
–
–
–
–
–
563
–
563
–
–
–
–
–
–
375
–
375
–
–
–
–
–
–
–
2,784
–
–
–
1,520
876
719
–
7,538
283
7,821
375 7
–
375 7
–
1,018
–
–
–
–
2,529
368
2,897
764
420
1,184
4,139
420
4,559
3,430
420
3,850
4,056
274
4,330
1,653
420
2,073
3,002
348
3,350
3,002
418
3,420
752
418
1,170
4,127
418
4,545
3,362
418
3,780
3,019
283
3,302
1,511
368
1,879
386
368
754
2,075
368
2,443
1,511
368
1,879
Dr. Axel Theis (Appointed: 01/2015)
Dr. Dieter Wemmer (Appointed: 01/2012)
Dr. Werner Zedelius (Appointed: 01/2002)
Actual
Grant
2016
Payout1
2015
2016
Grant
2016
Min
750
28
778
Grant
2016
Target
750
15
765
Min
750
15
765
Max
750
15
765
2015
Target
750
16
766
Actual
Grant
2016
750
15
765
Payout1
2015
2016
750
16
766
750
15
765
Grant
20 16
Target
750
18
768
Min
750
18
768
Max
750
18
768
2015
Target
750
19
769
Actual
Grant
2016
750
18
768
Payout1
2015
2016
750
19
769
750
18
768
IndIvIdual rEmunEratIon: 2016 and 2015
€ Thou (total might not sum up due to rounding)
Base Salary
Perquisites
Total fixed compensation
Annual Variable Compensation
Annual Bonus
Deferred Compensation
MTB (2016 – 2018)2
MTB (2013 – 2015)3
AEI 2017/RSu4
AEI 2016/RSu4
AEI 2012/RSu4
AEI 2011/RSu4
GEI 2010/RSu4
GEI 2010/SAR5
GEI 2008/SAR5
Total
Total
Pensions Service Cost6
Base Salary
Perquisites
Total fixed compensation
Annual Variable Compensation
Annual Bonus
Deferred Compensation
MTB (2016 – 2018)2
MTB (2013 – 2015)3
AEI 2017/RSu4
AEI 2016/RSu4
AEI 2012/RSu4
AEI 2011/RSu4
GEI 2010/RSu4
GEI 2010/SAR5
GEI 2008/SAR5
Total
Total
Pensions Service Cost6
2015
Target
750
14
764
750
750
–
–
–
–
–
–
–
3,014
274
3,288
2015
Target
750
27
777
750
750
–
–
–
–
–
–
–
3,027
397
3,424
Target
750
14
764
750
750
–
–
–
–
–
–
–
3,014
420
3,434
Target
750
28
778
750
750
–
–
–
–
–
–
–
3,028
482
3,510
Max
750
14
764
1,125
1,125
Max
750
28
778
1,125
1,125
–
–
–
–
–
–
–
–
–
–
–
–
–
–
–
–
–
–
–
–
–
–
–
–
–
–
–
–
–
–
–
–
–
–
750
14
764
889
889
–
–
–
–
–
–
–
750
28
778
973
973
–
–
–
–
–
–
–
2,534
–
–
–
–
–
–
–
–
750
27
777
956
–
–
–
–
–
–
–
–
–
–
–
–
–
–
–
–
–
–
–
–
–
–
–
–
–
–
750
28
778
750
750
1,125
973
956
973
750
750
–
750
–
750
–
–
–
–
–
750
–
750
–
–
–
–
–
–
–
–
–
–
–
–
–
–
–
–
1,125
954
961
954
750
750
1,125
–
1,125
–
–
–
–
–
–
954
–
954
–
–
–
–
–
–
–
3,156
–
–
–
–
–
–
–
–
–
–
–
–
–
–
–
–
–
750
–
750
–
–
–
–
–
750
–
750
–
–
–
–
–
–
–
–
–
–
–
–
–
–
–
–
1,125
–
1,125
–
–
–
–
–
–
954
–
954
–
–
–
–
–
–
1,125
954
959
954
was made.
2
3
1
In accordance with the German Corporate Governance Code, the annual bonus disclosed for perfor-
Annual Report 2009 (starting on page 17). Whereas the GEI/RSU grants are automatically exercised at the
mance year 2016 is paid in 2017 and for performance year 2015 in 2016. The payments for equity related
vesting date, the GEI/SAR grants are exercised by the Board member within the exercise period following
deferred compensation (GEI and AEI), however, are disclosed for the year in which the actual payment
the vesting date. Hence, the total payout from SARs depends on the individual decision by the Board
member. SARs are released to plan participants upon expiry of the vesting period, assuming all other
The MTB figure included in the “Actual Grant” column shows the annual accrual.
exercise hurdles are met. For SARs granted until and including 2008, the vesting period was two years and
The payout 2015 figure includes the 2015 allocation and the accruals from the performance years 2013
the exercise period five years. SARs can be exercised on the condition that the price of the Allianz SE stock
and 2014, as adjusted by the sustainability assessment. The MTB 2013 – 2015 was paid out in spring 2016.
is at least 20 % above the strike price at the time of grant. During the term of the plan, at least once on five
4
Payout is capped at 200 % above grant price. The relevant share price used to determine the fair market
consecutive trading days the Allianz SE stock must relatively appreciate at least 0.01 percentage points
value, and hence the final number of RSUs granted, and the 200 % cap are only available after sign-off by
ahead of the appreciation of the Dow Jones EURO STOXX Price Index (600).
the external auditors.
6
Pension Service Cost in accordance with IAS 19: represents the company cost not the actual entitlement
5
The equity-related remuneration that applied before 2010 consisted of two vehicles, virtual stock awards
nor a payment, however, according to the German Corporate Governance Code the Pension Service Cost
known as RSUs and virtual stock options known as “Stock Appreciation Rights” (SAR). Only RSUs have been
is to be included in all columns.
awarded as of 1 January 2010. The remuneration system valid until December 2009 is disclosed in the
778
482
1,260
4,153
482
4,635
3,697
482
4,179
2,689
397
3,086
1,751
482
2,233
3,016
282
3,298
3,015
479
3,494
765
479
1,244
4,140
479
4,619
3,628
479
4,107
4,883
282
5,165
1,719
479
2,198
3,019
646
3,665
3,018
661
3,679
768
661
1,429
4,143
661
4,804
3,631
661
4,292
7
Jay Ralph left Allianz on 30 June 2016. He received a pro-rated base salary and an amount of € 1,125 ThOU
in lieu of his pro-rated 2016 annual bonus, MTB tranche and equity-related compensation (€ 375 ThOU
each) which was paid in August 2016. According to his separation agreement, he received an amount of
€ 1,000 ThOU in return, specifically, for a non-poaching and non-competition agreement.
–
3,066
–
–
–
1,505
1,225
591
328
8,443
646
9,089
–
–
–
–
1,083
–
–
–
–
2,805
661
3,466
Annual Report 2016
Allianz SE
39
B
Management Report of Allianz SE
IndIvIdual rEmunEratIon: 2016 and 2015
€ Thou (total might not sum up due to rounding)
Base Salary
Perquisites
Total fixed compensation
Annual Variable Compensation
Annual Bonus
Deferred Compensation
MTB (2016 – 2018)2
MTB (2013 – 2015)3
AEI 2017/RSu4
AEI 2016/RSu4
AEI 2012/RSu4
AEI 2011/RSu4
GEI 2010/RSu4
GEI 2010/SAR5
GEI 2008/SAR5
Total
Pensions Service Cost6
Total
Dr. Maximilian Zimmerer7 (Appointed: 06/12; End of service: 12/2016)
2015
Target
750
16
766
Grant
2016
Target
750
16
766
Min
750
16
766
Max
750
16
766
Actual
Grant
2016
750
16
766
Payout1
2015
2016
750
16
766
750
16
766
1,125
983
940
983
750
750
–
750
–
750
–
–
–
–
–
3,016
386
3,402
750
–
750
–
–
–
–
–
–
3,016
786
3,802
–
–
–
–
–
–
–
–
–
–
1,125
–
1,125
–
–
–
–
–
–
766
786
1,552
4,141
786
4,927
983
–
983
–
–
–
–
–
–
3,714
786
4,500
–
2,993
–
–
–
–
–
–
–
–
–
–
–
–
–
–
–
–
4,699
386
5,085
1,749
786
2,535
1
2
3
4
5
In accordance with the German Corporate Governance Code, the annual bonus disclosed for perfor-
mance year 2016 is paid in 2017 and for performance year 2015 in 2016. The payments for equity related
deferred compensation (GEI and AEI), however, are disclosed for the year in which the actual payment
was made.
The MTB figure included in the “Actual Grant” column shows the annual accrual.
The payout 2015 figure includes the 2015 allocation and the accruals from the performance years 2013
and 2014, as adjusted by the sustainability assessment. The MTB 2013 – 2015 was paid out in spring 2016.
Payout is capped at 200 % above grant price. The relevant share price used to determine the fair market
value, and hence the final number of RSUs granted, and the 200 % cap are only available after sign-off by
the external auditors.
The equity-related remuneration that applied before 2010 consisted of two vehicles, virtual stock awards
known as RSUs and virtual stock options known as “Stock Appreciation Rights” (SAR). Only RSUs have been
awarded as of 1 January 2010. The remuneration system valid until December 2009 is disclosed in the
Annual Report 2009 (starting on page 17). Whereas the GEI/RSU grants are automatically exercised at the
vesting date, the GEI/SAR grants are exercised by the Board member within the exercise period following
the vesting date. Hence, the total payout from SARs depends on the individual decision by the Board
member. SARs are released to plan participants upon expiry of the vesting period, assuming all other
exercise hurdles are met. For SARs granted until and including 2008, the vesting period was two years and
the exercise period five years. SARs can be exercised on the condition that the price of the Allianz SE stock
is at least 20 % above the strike price at the time of grant. During the term of the plan, at least once on five
consecutive trading days the Allianz SE stock must relatively appreciate at least 0.01 percentage points
ahead of the appreciation of the Dow Jones EURO STOXX Price Index (600).
Pension Service Cost in accordance with IAS 19: represents the company cost not the actual entitlement
nor a payment, however, according to the German Corporate Governance Code the Pension Service Cost
is to be included in all columns.
Dr. Maximilian Zimmerer left the Allianz SE Board of Management upon his retirement effective 31 Decem-
ber 2016. According to his contract, he receives a transition payment of € 937.5 ThOU. The payment is
calculated based on the latest base salary, which is paid for a further six months starting 1 July 2017, and
a final lump-sum payment of 25 % of the target variable remuneration. The payable pension takes into
account the monthly payments over the six-month period. The lump-sum payment will be paid in spring
2018.
6
7
40
Annual Report 2016
Allianz SE
B
Management Report of Allianz SE
The sum of the total remuneration of the Board of Management for
2016, excluding the notional accruals of the MTB 2016 – 2018 and
excluding the pension service cost, amounts to € 26 MN1 (2015, includ-
ing the payout of the MTB 2013 – 2015: € 57 MN). The corresponding
amount, including pension service cost, equals € 30 MN (2015, includ-
ing the payout of the MTB 2013 – 2015: € 61 MN).
EQUITY-RELATED REMUNERATION
In accordance with the approach described earlier, a number of RSus
were granted to each member of the Board of Management in March
2017, which will vest and be settled in 2021.
GERMAN ACCOUNTING STANDARD 17 DISCLOSURE
The total remuneration to be disclosed for 2016 in accordance with
German Accounting Standard 17 is defined differently than in the
German Corporate Governance Code and is composed of the base
salary, perquisites, annual bonus and the fair value of the RSu grant
but excludes the notional annual accruals of the MTB 2016 – 2018. The
figures for 2015 (in parentheses) include the payout of the MTB
2013 – 2015. Both figures exclude the pension service cost:
Oliver Bäte € 4,103 (7,046) Thou,
Sergio Balbinot € 2,747 (3,780) Thou,
Jacqueline Hunt € 1,423 (–) Thou,
Dr. Helga Jung € 2,542 (4,813) Thou,
Dr. Christof Mascher € 2,492 (5,356) Thou,
Jay Ralph € 1,5111 (5,293) Thou,
Dr. Axel Theis € 2,724 (3,644) Thou,
Dr. Dieter Wemmer € 2,674 (5,844) Thou,
Dr. Werner Zedelius € 2,677 (5,753) Thou,
Dr. Maximilian Zimmerer € 2,731 (5,638) Thou.
GrantS and outStandInG holdInGS undEr thE allIanz EquIty proGram
Board members
Oliver Bäte
Sergio Balbinot
Jacqueline Hunt
Dr. Helga Jung
Dr. Christof Mascher
Jay Ralph
Dr. Axel Theis
Dr. Dieter Wemmer
Dr. Werner Zedelius
Dr. Maximilian Zimmerer
Total
RSu
Number of RSu
granted on
3 March 20171
11,515
7,677
3,565
6,944
6,798
–
7,604
7,457
7,457
7,677
Number of RSu
held at
31 December 20161
Number of SAR
held at
31 December 2016
SAR
40,671
34,120
–
31,997
33,885
35,681
24,366
37,688
36,582
33,420
–
–
–
3,167
7,892
–
–
–
–
–
66,694
308,410
11,059
Strike Price
€
–
–
–
87.36
87.36
–
–
–
–
–
–
1
The relevant share price used to determine the fair market value, and hence the final number of RSUs
granted, is only available after sign-off of the Annual Report by the external auditors, thus numbers are
based on a best estimate. As disclosed in the Annual Report 2015, the equity-related grant in 2016 was
made to participants as part of their 2015 remuneration. The disclosure in the Annual Report 2015 was
based on a best estimate of the RSU grants. The actual grants deviated from the estimated values and
have to be disclosed accordingly. The actual RSU grants as of 4 March 2016 under the Allianz Equity Incen-
tive are as follows: Oliver Bäte: 11,733, Sergio Balbinot: 9,300, Dr. Helga Jung: 7,053, Dr. Christof Mascher:
7,999, Jay Ralph: 8,098, Dr. Axel Theis: 8,896, Dr. Dieter Wemmer: 8,948, Dr. Werner Zedelius: 8,926,
Dr. Maximilian Zimmerer: 8,746.
1
Including the payout of Jay Ralph’s MTB tranche for 2016 of € 375 ThOU.
Annual Report 2016
Allianz SE
41
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Management Report of Allianz SE
PENSIONS
Company contributions for the current pension plan are set at 50 % of
the base salary reduced by the cover for disability and death. They are
invested in a fund and have a guarantee for the contributions paid, but
no further interest guarantee (for members of the Board of Manage-
ment who were born before 1 January 1958, the guaranteed minimum
interest rate remains at 2.75 % p.a.). For members with pension rights
in the frozen defined benefit plan, the above contribution rates are
reduced by 19 % of the expected annual pension from that frozen plan.
The Allianz Group paid € 5 MN (2015: € 4 MN) to increase reserves for
pensions and similar benefits for active members of the Board of
Management. As of 31 December 2016, reserves for pensions and
similar benefits for active members of the Board of Management
amounted to € 44 MN (2015: € 38 MN).
IndIvIdual pEnSIonS: 2016 and 2015
€ Thou
Defined benefit pension plan
(frozen)
Contribution-
based pension
plan (frozen)1
Current pension
plan
AVK/APV2
Transition
payment3
Total
Board of Management
Oliver Bäte
(Chairman since 7 May 2015)
Sergio Balbinot
Jacqueline Hunt
Dr. Helga Jung
Dr. Christof Mascher
Jay Ralph7
Dr. Axel Theis
Dr. Dieter Wemmer
Dr. Werner Zedelius
Dr. Maximilian Zimmerer
2016
2015
2016
2015
2016
2015
2016
2015
2016
2015
2016
2015
2016
2015
2016
2015
2016
2015
2016
2015
Annual
pension
payment4
–
–
–
–
–
–
62
62
–
–
–
–
120
120
–
–
225
225
141
161
SC 5
DBo 6
SC 5
DBo 6
SC 5
DBo 6
SC 5
DBo 6
SC 5
DBo 6
SC 5
DBo 6
–
–
–
–
–
–
54
56
–
–
–
–
107
110
–
–
207
213
146
150
–
–
–
–
–
–
1,347
1,187
–
–
–
–
3,422
3,085
–
–
6,385
5,751
4,078
3,897
33
283
5
219
–
–
12
210
12
280
8
278
6
199
477
278
431
398
5
191
3,063
2,916
39
243
–
–
1,813
1,800
3,115
3,016
–
1,860
2,528
2,450
1,832
1,181
5,090
4,151
2,783
2,672
536
–
357
–
159
–
345
–
357
–
357
–
334
–
–
–
–
–
818
–
582
–
159
–
558
–
637
–
–
–
535
–
–
–
–
–
327
–
519
–
5
6
2
2
–
–
8
8
5
5
3
5
9
10
2
4
9
9
9
9
36
31
4
2
–
–
159
147
42
37
–
23
233
214
10
8
222
203
214
196
51
194
594
495
–
1
–
–
–
–
43
63
–
–
25
78
–
–
14
26
300
36
1
1
–
–
–
–
583
508
–
1
774
722
–
1
678
641
938
656
625
483
365
222
159
–
420
274
418
348
368
283
482
397
479
282
661
646
786
386
4,511
3,442
626
246
159
–
3,878
3,134
4,377
3,562
–
1,884
7,493
6,471
1,842
1,190
12,375
10,746
8,532
7,422
1
2
3
The service cost of the frozen contribution-based pension plan reflects the continued death and disability
cover.
Plan participants contribute 3 % of their relevant salary to the AVK. For the AVK the minimum guaranteed
interest rate is 2.75 % – 3.50 % depending on the date of joining Allianz. In general, the company funds the
balance required via the APV. Before Allianz’s founding of the APV in 1998, both Allianz and the plan par-
ticipants were contributing to the AVK.
For details on the transition payment, see section “Termination of service”. In any event, a death benefit
is included.
4
5
6
7
Expected annual pension payment at assumed retirement age (age 60), excluding current pension plan.
SC = service cost. Service costs are calculatory costs for the DBO related to the reported business year.
DBO = defined benefit obligation, end of year. The figures show the obligation for Allianz resulting from
defined benefit plans taking into account realistic assumptions with regard to interest rate, dynamics and
biometric probabilities.
As Jay Ralph left Allianz on 1 July 2016, his employer-financed DBO of € 2,437 ThOU (thereof € 1,755 ThOU
for the frozen DB-Pension-Plan, € 636 ThOU for the contribution based pension plan and € 25 ThOU for the
Current Pension Plan, AVK/APV) is covered under former Board members.
In 2016, remuneration and other benefits totaling € 7 MN (2015:
€ 7 MN)1 were paid to former members of the Board of Management
and dependents, while reserves for current pension obligations and
accrued pension rights totaled € 119 MN (2015: € 116 MN).
LOANS TO MEMBERS OF THE BOARD OF MANAGEMENT
As of 31 December 2016, there were no outstanding loans granted by
Allianz Group companies to members of the Board of Management.
TERMINATION OF SERVICE
Board of Management contracts are limited to a period of five years.
For new appointments, in compliance with the German Corporate
Governance Code, a shorter period is typical.
1
The 2015 amount includes bonus payments made to Clement Booth in 2015 which were already shown
as variable compensation for 2014. The amount shown for 2016 excludes compensation that was paid for
active Board membership and disclosed as compensation of the respective performance year.
Arrangements for termination of service including retirement are as
follows:
1. Board members who were appointed before 1 January 2010 – and
who have served a term of at least five years – are eligible for a six-
month transition payment after leaving the Board of Management.
2. Severance payments made to Board members in case of an early
termination comply with the German Corporate Governance Code.
3. Special terms, also compliant with the German Corporate Gover-
nance Code, apply if service is ended as a result of a “change of
control”. This requires that a shareholder of Allianz SE, acting
alone or together with other shareholders, holds more than 50 % of
voting rights in Allianz SE.
Contracts do not contain provisions for any other cases of early ter-
mination from the Board of Management.
42
Annual Report 2016
Allianz SE
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Management Report of Allianz SE
Board members who were appointed before 1 January 2011 are
eligible to use a company car for a period of one year after their retire-
ment.
OUTLOOK FOR 2017
The remuneration of the new regular member of the Board of
Manage ment, Dr. Günther Thallinger, has been set at the same level
as for the other regular members of the Board of Management.
TERMINATION OF SERVICE –
DETAILS OF THE PAYMENT ARRANGEMENTS
Transition payment (appointment before 1 January 2010)
Board members receiving a transition payment are subject to a six-
month non-compete clause.
The payment is calculated based on the last base salary (paid for
a period of six months) and 25 % of the target variable remuneration
at the date when notice is given. A Board member with a base salary
of € 750 Thou would receive a maximum of € 937.5 Thou.
Where an Allianz pension is immediately payable, transition
payment amounts are set off accordingly.
Severance payment cap
Payments to Board members for early termination with a remaining
term of contract of more than two years are capped at two years’ com-
pensation.
Whereby the annual compensation:
1. is calculated on the basis of the previous year’s annual base sala-
ry plus 50 % of the target variable remuneration (annual bonus,
accrued MTB and equity-related remuneration: For a Board mem-
ber with a fixed base salary of € 750 Thou, the annual compensa-
tion would amount to € 1,875 Thou. Hence, he/she would receive
a maximum severance payment of € 3,750 Thou) and
2. shall not exceed the latest year’s actual total compensation.
If the remaining term of contract is less than two years, the payment
is pro-rated according to the remaining term of the contract.
Change of control
In case of early termination as a result of a change of control, sever-
ance payments made to Board members generally amount to three
years’ compensation (annual compensation as defined above) and
shall not exceed 150 % of the severance payment cap (a Board mem-
ber with a base salary of € 750 Thou would receive a maximum of
€ 5,625 Thou).
MISCELLANEOUS
INTERNAL AND EXTERNAL BOARD APPOINTMENTS
When a member of the Board of Management holds an appointment
in another company within the Allianz Group, the full remuneration
amount is transferred to Allianz SE. In recognition of the benefits to the
organization, Board of Management members are allowed to accept
a limited number of non-executive supervisory roles in appropriate
external organizations. In these cases, 50 % of the remuneration
received is paid to Allianz SE. A Board member retains the full remu-
neration only when the Supervisory Board qualifies the appointment
as a personal one. Remuneration paid by external organizations is
shown in the annual reports of the companies concerned. The remu-
neration relating to the external appointment is set by the governing
body of the relevant organization.
Remuneration of the Supervisory Board
The remuneration of the Supervisory Board is governed by the Statutes
of Allianz SE and the German Stock Corporation Act. The structure of
the Supervisory Board’s remuneration is regularly reviewed with
respect to German, European and international corporate gover-
nance recommendations and regulations.
REMUNERATION PRINCIPLES
− Set total remuneration at a level aligned with the scale and scope
of the Supervisory Board’s duties, and appropriate to the com-
pany’s activities and business and financial situation.
− Set a remuneration structure that takes into account the indi-
vidual functions and responsibilities of Supervisory Board mem-
bers, such as chair, vice chair or committee mandates.
− Set a remuneration structure to allow for proper oversight of busi-
ness as well as for adequate decisions on executive personnel and
remuneration.
REMUNERATION STRUCTURE AND COMPONENTS
The remuneration structure, which comprises fixed and committee-
related remuneration only, was approved by the Annual General
Meeting 2011 and is laid down in the Statutes of Allianz SE.
FIXED ANNUAL REMUNERATION
The remuneration of a Supervisory Board member consists of a fixed
cash amount paid after the end of each business year for services
rendered over that period. As in 2015, a regular Supervisory Board
member receives a fixed remuneration of € 100 Thou per year. Each
Vice Chairperson receives € 150 Thou and the Chairperson € 200 Thou.
COMMITTEE-RELATED REMUNERATION
The Chairperson and members of the Supervisory Board committees
receive additional committee-related remuneration. The committee-
related remuneration is as follows:
CommIttEE-rElatEd rEmunEratIon
€ Thou
Committee
Personnel Committee, Standing
Committee, Risk Committee
Audit Committee
Chair
Member
40
80
20
40
ATTENDANCE FEES AND EXPENSES
In addition to the fixed and committee-related remuneration, mem-
bers of the Supervisory Board receive an attendance fee of € 750 for
each Supervisory Board or committee meeting they attend. Should
several meetings be held on the same or consecutive days, the atten-
dance fee will be paid only once. Allianz SE reimburses the members
of the Supervisory Board for their out-of-pocket expenses and the VAT
payable on their Supervisory Board activity. For the performance of
Annual Report 2016
Allianz SE
43
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Management Report of Allianz SE
his duties, the Chairman of the Supervisory Board is furthermore
entitled to an office with secretarial support and use of the Allianz
carpool service. In the financial year 2016, Allianz SE reimbursed
expenses totaling € 51,935.
REMUNERATION FOR 2016
The total remuneration for all Supervisory Board members, including
attendance fees, amounted to € 2,025 Thou in 2016 (2015: € 2,021 Thou).
The following table shows the individual remuneration for 2016 and
2015:
IndIvIdual rEmunEratIon: 2016 and 2015
€ Thou (total might not sum up due to rounding)
Members of the Supervisory Board
Dr. Helmut Perlet
(Chairman)
Dr. Wulf H. Bernotat
(Vice Chairman)
Rolf Zimmermann
(Vice Chairman)
Dante Barban
Christine Bosse
Gabriele Burkhardt-Berg
Jean-Jacques Cette
Dr. Friedrich Eichiner2
Ira Gloe-Semler3
Martina Grundler4
Prof. Dr. Renate Köcher
Jürgen Lawrenz5
Jim Hagemann Snabe
Peter Denis Sutherland6
Total7
Committees1
P
C
C
M
M
M
M
S
C
C
M
M
M
M
M
M
M
M
R
C
C
M
M
M
M
M
M
M
M
M
A
M
M
C
C
M
M
M
M
M
M
M
N
C
C
M
M
M
M
M
Fixed
remu ne ration
Commit tee
remu ne ration
Atten dance
fees
Total
remu neration
200.0
200.0
150.0
150.0
150.0
150.0
100.0
100.0
100.0
100.0
100.0
100.0
100.0
100.0
66.6
–
25.0
100.0
75.0
–
100.0
100.0
100.0
41.7
100.0
100.0
41.6
100.0
160.0
160.0
100.0
100.0
40.0
40.0
20.0
20.0
40.0
40.0
20.0
20.0
40.0
40.0
13.3
–
10.0
40.0
26.6
–
20.0
20.0
20.0
8.3
40.0
40.0
8.3
20.0
6.7
6.7
4.5
4.5
4.5
5.2
4.5
4.5
4.5
5.2
4.5
4.5
6.0
6.0
2.2
–
1.5
6.0
4.5
–
3.7
4.5
4.5
2.2
5.2
5.2
1.5
3.7
366.7
366.7
254.5
254.5
194.5
195.2
124.5
124.5
144.5
145.2
124.5
124.5
146.0
146.0
82.1
–
36.5
146.0
106.1
–
123.7
124.5
124.5
52.2
145.2
145.2
51.4
123.7
1,408.2
1,400.0
558.2
560.0
58.5
60.7
2,025.2
2,020.7
2016
2015
2016
2015
2016
2015
2016
2015
2016
2015
2016
2015
2016
2015
2016
2015
2016
2015
2016
2015
2016
2015
2016
2015
2016
2015
2016
2015
2016
2015
Legend: C = Chairperson of the respective committee, M = Member of the respective committee
1
2
3
4
Abbreviations: A – Audit, N – Nomination, P – Personnel, R – Risk, S – Standing.
Since 4 May 2016.
Until 31 March 2016.
Since 1 April 2016.
5
6
7
Since 1 August 2015.
Until 4 May 2016.
The total reflects the remuneration of the full Supervisory Board in the respective year.
REMUNERATION FOR MANDATES IN OTHER
ALLIANZ COMPANIES AND FOR OTHER FUNCTIONS
As remuneration for her membership in the Supervisory Board
of Allianz Deutschland AG Ms. Gabriele Burkhardt-Berg received
€ 20.9 Thou for the financial year 2016. Mr. Jürgen Lawrenz did not
receive a separate remuneration for his membership in the Super-
visory Board of Allianz Managed Operations & Services SE. All current
employee representatives of the Supervisory Board except for
Ms. Martina Grundler (until 31 March 2016 Ms. Ira Gloe-Semler) are
employed by Allianz Group companies and receive a market-aligned
remuneration for their services.
LOANS TO MEMBERS OF THE SUPERVISORY BOARD
As of 31 December 2016, there was one outstanding loan granted by
Allianz Group companies to members of the Supervisory Board of
Allianz SE. One member received a mortgage loan of € 80 Thou from
Allianz Bank in 2010. The loan has a duration of ten years and was
granted at a normal market interest rate.
44
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Allianz SE
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Management Report of Allianz SE
Other Information
Our steering
Our Corporate Responsibility approach
BOARD OF MANAGEMENT
AND ORGANIZATIONAL STRUCTURE
Allianz SE has a divisional Board structure based on functional and
business responsibilities. Business-related divisions reflect our busi-
ness segments Property-Casualty, Life/Health, Asset Management,
and Corporate and Other, and in 2016 were overseen by five Board
members. The remaining four divisions (i.e. Chairman of the Board
of Management, Finance, Investments, and Operations) focus on
Group functions, along with business-related responsibilities.
For further information on Board of Management members and
their responsibilities, please refer to Mandates of the Members of the
Board of Management on
page 8.
As an international financial services company, we find it vital to
ensure that our growth is both sustainable and profitable. We want
to create long-term value by strategically embedding sustainability
in our core business and by enabling our customers to address
tomorrow’s challenges. This requires us to continually adapt our
business strategy in response to our stakeholders’ and working part-
ners’ needs, to the most pressing sustainability issues, and to the
activities of national and international sustainability bodies and ini-
tiatives, in order to deliver on global commitments such as the United
Nations Sustainable Development Goals.
Our Corporate Responsibility Strategy contributes to our Renewal
Agenda and focuses on our most material sustainability issues:
Low-carbon economy: supporting renewable energy and decarbon-
ization through our investments; providing green insurance solutions;
reducing our environmental footprint.
Social inclusion: supporting the social inclusion of children and youth
through our Future Generations program; developing solutions for
customers in emerging markets; promoting diversity and wellbeing
among our employees.
Business integrity: integrating environmental, social and governance
(ESG) issues across our investment and insurance businesses; building
trust through transparency, responsible sales, and data privacy.
In 2016, we surveyed over 6,000 stakeholders to identify our most
material issues as well as the relative importance of the solutions we
provide. The results show that the most important megatrends and
risks Allianz faces across those target groups and countries surveyed
are climate change & environment, personal customer safety, digita-
lization, societal change, and fiscal crisis. We will continue to integrate
our stakeholders’ views in both our sustainability strategy and our
reporting approach.
For reporting purposes, we organize our approach around
Allianz’s five key roles as sustainable insurer, responsible investor,
trusted company, attractive employer, and committed corporate
citizen.
Please refer to our 2016 Group Sustainability Report (to be
published on 5 April 2017) for full details of our corporate responsi-
www.allianz.com/
bility strategy, approach and performance:
sustainability.
TARGET SETTING AND MONITORING
The Allianz Group steers its operating entities and business seg-
ments via an integrated management and control process. It begins
with the definition of a business-specific strategy and goals, which
are discussed and agreed upon between the Holding and operating
entities. Based on this strategy, our operating entities prepare three-
year plans which are then aggregated to form the financial plans for
the business divisions and for the Allianz Group as a whole. This plan
also forms the basis for our capital management. The Supervisory
Board approves the plan and sets corresponding targets for the Board
of Management. The performance-based remuneration of the Board
of Management is linked to short-term, mid-term, and long-term tar-
gets to ensure effectiveness and emphasize sustainability. For further
details about our remuneration structure, including target setting
and performance assessment, please refer to the Remuneration
Report starting on
page 34.
We continuously monitor our business performance against
these targets through monthly reviews – which cover key operational
and financial metrics – to ensure we can move quickly and take
appropriate measures in the event of negative developments. The
Allianz Group uses operating profit and net income as key financial
performance indicators across all its business segments. Other indi-
cators include segment-specific figures, such as the combined ratio
for Property-Casualty, return on equity1 for Life/Health, and the cost-
income ratio for Asset Management. To steer and control new busi-
ness in our business segments Property-Casualty and Life/Health, we
use Return on Risk Capital (RoRC).
Besides performance steering, we also have a risk steering process
in place, which is described in the Risk and Opportunity Report starting
on
page 19.
Non-financial key performance indicators (KPIs) are mainly used
for the sustainability assessment that we conduct when determining
mid-term bonus levels. In line with our Renewal Agenda, KPIs mainly
represent three key levers: True Customer Centricity, Digital by Default,
and Inclusive Meritocracy. Examples include the Allianz Engagement
Survey and Net Promoter Score (NPS2) results, diversity development,
and the share of digital retail products/digital client communication.
1
2
Excluding unrealized gains/losses on bonds net of shadow accounting.
NPS is a measurement of customers’ willingness to recommend Allianz. Top-down NPS is measured
regularly according to global cross industry standards and allows benchmarking against competitors in
the respective markets.
Annual Report 2016
Allianz SE
45
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Management Report of Allianz SE
Branches
In 2016, Allianz SE operated its reinsurance business from Munich
and from branch offices in Singapore, Labuan (Malaysia), Wallisellen
(Suisse) and Dublin (Ireland).
Takeover-related statements
and explanations
The following information is given pursuant to § 289 (4) of the German
Commercial Code (“Handelsgesetzbuch – HGB”) and § 176 (1) of the
German Stock Company Act (“Aktiengesetz – AktG”).
COMPOSITION OF SHARE CAPITAL
As of 31 December 2016, the share capital of Allianz SE was € 1,169,920,000.
It was divided into 457,000,000 registered and fully paid-up shares with
no-par value and a corresponding share capital amount of € 2.56 per
share. All shares carry the same rights and obligations. Each no-par
value share carries one vote.
RESTRICTIONS ON VOTING RIGHTS AND
SHARE TRANSFERS; EXERCISE OF VOTING RIGHTS
IN CASE OF EMPLOYEE EQUITY PARTICIPATIONS
Shares may only be transferred with the consent of the company. An
approval duly applied for may only be withheld if it is deemed neces-
sary in the company’s interest on exceptional grounds. The applicant
will be informed of the reasons.
Shares acquired by employees of the Allianz Group as part of the
Employee Stock Purchase Plan are, in principle, subject to a one-year
lock-up period. Outside Germany, the lock-up period may in some
cases be up to five years. In some countries, in order to ensure that the
lock-up period is observed, the employee shares are held throughout
that period by a bank, another natural person or a legal entity acting
as a trustee. Nevertheless, employees may instruct the trustee to exer-
cise voting rights, or have power of attorney granted to them to exer-
cise such voting rights. Lock-up periods contribute to the Employee
Stock Purchase Plan’s aims of committing employees to the company
and letting them benefit from the performance of the share price.
INTERESTS IN THE SHARE CAPITAL
EXCEEDING 10 % OF THE VOTING RIGHTS
We are not aware of any direct or indirect interests in the share capital
of Allianz SE that exceed 10 % of the voting rights.
SHARES WITH SPECIAL RIGHTS
CONFERRING POWERS OF CONTROL
There are no shares with special rights conferring powers of control.
LEGAL AND STATUTORY PROVISIONS APPLICABLE
TO THE APPOINTMENT AND REMOVAL OF MEMBERS OF
THE BOARD OF MANAGEMENT AND TO AMENDMENTS
OF THE STATUTES
The Supervisory Board appoints the members of Allianz SE’s Board of
Management for a maximum term of five years (Articles 9 (1), 39 (2)
and 46 of the SE Regulation, §§ 84, 85 AktG and § 5 (3) of the Statutes).
Reappointments, for a maximum of five years each, are permitted. A
simple majority of the votes cast in the Supervisory Board is required
to appoint members of the Board of Management. In the case of a tie
vote, the Chairperson of the Supervisory Board, who pursuant to
Article 42 of the SE Regulation must be a shareholder representative,
shall have the casting vote (§ 8 (3) of the Statutes). If the Chairperson
does not participate in the vote the Vice Chairperson shall have the
casting vote, provided he or she is a shareholder representative. A
Vice Chairperson who is an employee representative has no casting
vote (§ 8 (3) of the Statutes). If a required member of the Board of Man-
agement is missing, in urgent cases the courts must appoint such
member upon the application of an interested party (§ 85 AktG). The
Supervisory Board may dismiss members of the Board of Manage-
ment if there is an important reason (§ 84 (3) AktG).
According to § 5 (1) of the Statutes, the Board of Management
shall consist of at least two persons. Apart from that, the Supervisory
Board determines the number of members. The Supervisory Board
has appointed a Chairman of the Board of Management pursuant to
§ 84 (2) AktG.
German insurance supervisory law requires that members of the
Board of Management have the reliability and professional compe-
tence needed to manage an insurance company. A person cannot
become a member of the Board of Management if he or she is already
a manager of two other insurance undertakings, pension funds,
insurance holding companies or insurance special purpose vehicles.
However, the supervisory authority may permit more than two such
mandates if they are held within the same group (§ 24 (3) of the German
Insurance Supervision Act (“Versicherungsaufsichts gesetz – VAG”)).
The Federal Financial Services Supervisory Authority (“Bundes anstalt
für Finanz dienst leistungsaufsicht – BaFin”) must be notified about
the intention of appointing a Board of Management member pursuant
to § 47 No. 1 VAG.
Amendments to the Statutes must be adopted by the General
Meeting. § 13 (4) of the Statutes of Allianz SE stipulates that, unless this
conflicts with mandatory law, changes to the Statutes require a two-
thirds majority of the votes cast, or, if at least one half of the share
capital is represented, a simple majority of the votes cast. The Sta-
tutes thereby make use of the option set out in § 51 of the SE Imple-
mentation Act (“SE-Ausführungsgesetz – SEAG”), which is based upon
Article 59 (1) and (2) of the SE Regulation. A larger majority is required,
inter alia, for a change in the corporate object or the relocation of the
registered office to another E.U. member state (§ 51 SEAG). The Super-
visory Board may alter the wording of the Statutes (§ 179 (1) AktG and
§ 10 of the Statutes).
AUTHORIZATION OF THE BOARD OF MANAGEMENT
TO ISSUE AND REPURCHASE SHARES
The Board of Management is authorized to issue shares as well as to
acquire and use treasury shares as follows:
It may increase the company’s share capital, on or before 6 May
2019, with the approval of the Supervisory Board, by issuing new reg-
istered no-par value shares against contributions in cash and/or in
kind, on one or more occasions:
− Up to a total of € 550,000,000 (Authorized Capital 2014/I). In case
of a capital increase against cash contribution, the Board of Man-
agement may exclude the shareholders’ subscription rights for
these shares with the consent of the Supervisory Board, (i) for
fractional amounts, (ii) in order to safeguard the rights pertaining
to holders of convertible bonds or bonds with warrants, including
mandatory convertible bonds, and (iii) in the event of a capital
increase of up to 10 %, if the issue price of the new shares is not
significantly below the stock market price. The Board of Manage-
ment may furthermore exclude the shareholders’ subscription
46
Annual Report 2016
Allianz SE
B
Management Report of Allianz SE
rights with the consent of the Supervisory Board, in the event of a
capital increase against contributions in kind.
venture or the target company, if there is a change of control of
the other party.
− Up to a total of € 13,720,000 (Authorized Capital 2014/II). The share-
holders’ subscription rights can be excluded in order to issue the
new shares to employees of Allianz SE and its Group companies
as well as for fractional amounts.
− The framework agreements between Allianz SE and the subsi-
diaries of various car manufacturers relating to the distribution
of car insurance by the respective car manufacturers each include
a clause under which each party has an extraordinary termina-
tion right in case there is a change of control of the other party.
The company’s share capital is conditionally increased by up to
€ 250,000,000 (Conditional Capital 2010/2014). This conditional capital
increase will only be carried out to the extent that conversion or
option rights are exercised (or conversion obligations fulfilled)
resulting from bonds that have been issued by Allianz SE or its sub-
sidiaries based on the authorizations granted by the General Meeting
on 5 May 2010 and 7 May 2014.
The Board of Management may buy back and use Allianz shares
for other purposes until 6 May 2019 on the basis of the authorization
of the General Meeting of 7 May 2014 (§ 71 (1) No. 8 AktG). Together with
other treasury shares that are held by Allianz SE, or which are attribut-
able to it under §§ 71a et seq. AktG, such shares may not exceed 10 %
of the share capital at any time. The shares acquired pursuant to this
authorization may be used, under exclusion of the shareholders’ sub-
scription rights, for any legally admissible purposes, and in particular
those specified in the authorization. Furthermore, the acqui sition of
treasury shares under this authorization may also be carried out
using derivatives such as put options, call options, forward purchases
or a combination thereof, provided such derivatives do not relate to
more than 5 % of the share capital.
Domestic or foreign banks that are majority-owned by Allianz SE
may buy and sell Allianz shares for trading purposes (§ 71 (1) No. 7
and (2) AktG) under an authorization of the General Meeting valid
until 6 May 2019. The total number of shares acquired thereunder,
together with treasury shares held by Allianz SE or attributable to it
under §§ 71a et seq. AktG, shall at no time exceed 10 % of the share
capital of Allianz SE.
ESSENTIAL AGREEMENTS OF ALLIANZ SE WITH CHANGE
OF CONTROL CLAUSES AND COMPENSATION AGREEMENTS
PROVIDING FOR TAKEOVER SCENARIOS
The following essential agreements of the company are subject to a
change of control condition following a takeover bid:
− Our reinsurance contracts, in principle, include a clause under
which both parties to the contract have an extraordinary termina-
tion right if and when the counterparty merges or its ownership
or control situation changes materially. Agreements with brokers
regarding services connected with the purchase of reinsurance
cover also provide for termination rights in case of a change of
control. Such clauses are standard market practice.
− Allianz SE is also party to various bancassurance distribution
agreements for insurance products in various regions. These dis-
tribution agreements normally include a clause under which the
parties have an extraordinary termination right in case there is a
change of control of the other party’s ultimate holding company.
− Shareholder agreements and joint ventures to which Allianz SE is
a party often contain change-of-control clauses that provide, as
the case may be, for the termination of the agreement, or for put
or call rights that one party can exercise with regard to the joint
− Bilateral credit agreements in some cases provide for termina-
tion rights if there is a change of control, mostly defined as the
acquisition of at least 30 % of the voting rights within the meaning
of § 29 (2) of the German Takeover Act (“Wertpapiererwerbs- und
Übernahmegesetz – WpÜG”). If such termination rights are exer-
cised, the respective credit lines have to be replaced by new
credit lines under conditions then applicable.
The company has entered into the following compensation agree-
ments with members of the Board of Management and certain
employees providing for the event of a takeover bid:
A change-of-control clause in the service contracts of the mem-
bers of Allianz SE’s Board of Management provides that, if within
twelve months after the acquisition of more than 50 % of the compa-
ny’s share capital by one shareholder or several shareholders acting
in concert (change of control) the appointment as a member of the
Board of Management is revoked unilaterally by the Supervisory
Board, or if the mandate is ended by mutual agreement, or if the
Management Board member resigns because his or her responsibi-
lities as a Board member are significantly reduced through no fault
of the Board member, he or she shall receive his or her contractual
remuneration for the remaining term of the service contract, but lim-
ited, for the purpose hereof, to three years, in the form of a one-off
payment. The one-off payment is based on the fixed remuneration
plus 50 % of the variable remuneration, however, this basis being lim-
ited to the amount paid for the last fiscal year. To the extent that the
remaining term of the service contract is less than three years, the
one-off payment is generally increased in line with a term of three
years. This applies accordingly if, within two years of a change of con-
trol, a mandate in the Board of Management comes to an end and is
not extended; the one-off payment will then be granted for the period
between the end of the mandate and the end of the three-year period
after the change of control. For further details, please refer to the
Remuneration Report starting on
page 34.
Under the Allianz Sustained Performance Plan (ASPP), Restricted
Stock Units (RSU) – i.e. virtual Allianz shares – are granted as a stock-
based remuneration component to senior management of the Allianz
Group worldwide. In addition, under the Group Equity Incentive (GEI)
scheme, Stock Appreciation Rights (SAR) – i.e. virtual options on
Allianz shares – were also granted until 2010. Some of these are still
outstanding. The conditions for these RSU and SAR contain change-
of-control clauses, which apply if a majority of the voting share capital
in Allianz SE is acquired, directly or indirectly, by one or more third
parties who do not belong to the Allianz Group and which provide for
an exception from the usual vesting and exercise periods. The RSU
will be released, in line with their general conditions, by the company
for the relevant plan participants on the day of the change of control
without observing any vesting period that would otherwise apply. The
cash amount payable per RSU must equal the average market value
of the Allianz share and be equal to or above the price offered per
Allianz share in a preceding tender offer. In case of a change of control
Annual Report 2016
Allianz SE
47
B
Management Report of Allianz SE
as described above, SAR will be exercised, in line with their general
conditions, by the company for the relevant plan participants on the
day of the change of control, without observing any vesting period. By
providing for the non-application of the vesting period in the event of
a change of control, the terms take into account the fact that the con-
ditions under which the share price moves are very different when
there is a change of control.
Controls over Financial Reporting
The following information is given pursuant to § 289 (5) of the German
Commercial Code.
In line with both our prudent approach to risk governance and com-
pliance with regulatory requirements, we have created a structure to
identify and mitigate the risk of material errors in our financial state-
ments (this also includes market value balance sheet and risk capital
controls). Our internal control system over financial reporting (ICOFR)
is based on the revised framework developed by the Committee of
Sponsoring Organizations of the Treadway Commission (COSO) in
2013, and is regularly reviewed and updated. Our approach includes
the following five interrelated components: control environment, risk
assessment, control activities, information and communication and
monitoring. These five components are covered by an Entity-Level
Control Assessment Process (ELCA), IT General Controls (ITGC), and
controls at process levels. The ELCA framework contains controls
such as compliance programs, or a committee governance structure.
In the ITGC framework we have implemented, for example, controls
for access-rights management and for project and change manage-
ment.
ACCOUNTING PROCESSES
The accounting processes we use to produce our financial statement
are based on a group-wide IT solution and a local general ledger.
Access rights to the accounting system are managed according to
strict authorization procedures.
Internal controls are embedded in the accounting processes to
safeguard the accuracy, completeness, and consistency of the infor-
mation provided in our financial statements.
INTERNAL CONTROL SYSTEM APPROACH
Our approach can be summarized as follows:
− We use a top-down, risk based approach to determine the
accounts that should fall under the scope of our internal control
system over financial reporting. The methodology is described in
the group-wide applicable ICOFR manual. During the scoping
process, both materiality and susceptibility to a misstatement
are considered simulta neously. The final results are documented
in the list of significant accounts. In addition to the quantitative
ICOFR calculation, we also consider qualitative criteria.
− Then, we identify risks that could lead to material financial
misstatements, including all relevant root causes (i.e. human
processing errors, fraud, system shortcomings, external factors,
etc.). After identifying and analyzing the risks, their potential
impacts and probabilities of occurrence are evaluated.
− Preventive and detective key controls over the financial reporting
process have been put in place to reduce the likelihood and
impact of financial misstatements. If a potential risk materia-
lizes, actions are taken to reduce the impact of the financial mis-
statement. Given the strong dependence of financial reporting
processes on information technology systems, we also imple-
ment IT controls.
− Finally, we focus on ensuring that controls are appropriately
designed and effectively executed to mitigate risk. Allianz Group
set consistent documentation requirements for elements such
as processes, related key controls, and execution. We conduct an
annual assessment of our control system to maintain and con-
tinuously enhance its effectiveness. Audit ensures that the over-
all quality of our control system is subjected to regular control-
testing, to assure reasonable design and operating effectiveness.
48
Annual Report 2016
Allianz SE
Annual Report 2016
Allianz SE
49
FINANCIAL STATEMENTS OF ALLIANZ SEC C
Financial Statements of Allianz SE
Financial Statements
Balance Sheet
€ thou
as of 31 December
ASSEtS
A.
Intangible assets
I.
Self-produced industrial property rights and similar rights and assets
II. Licenses acquired against payment, industrial property rights
and similar rights and assets as well as licenses for such rights and assets
III. Advance payments made
B.
Investments
I. Real estate
II.
Investments in affiliated enterprises and participations
III. Other investments
IV. Funds held by others under reinsurance business assumed
C. Receivables
I. Accounts receivable on reinsurance business
thereof from affiliated enterprises: € 217,820 thou (2015: € 295,293 thou)
thereof from participations1: € 1,756 thou (2015: € 5,630 thou)
Note
2016
2016
2015
1, 2
1, 3 – 5
17,623
2,928
–
250,343
71,354,121
33,446,657
8,028,086
20,551
5,842
7,038
5,800
18,680
254,389
73,711,243
27,726,413
6,094,716
113,079,207
107,786,761
450,606
495,670
II. Other receivables
6
5,022,127
4,794,374
thereof from affiliated enterprises: € 4,325,105 thou (2015: € 4,206,194 thou)
thereof from participations1: € 2,807 thou (2015: € 584 thou)
D. Other assets
I.
Tangible fixed assets and inventories
II. Cash with banks, checks and cash on hand
III. Miscellaneous assets
E. Deferred charges and prepaid expenses
I. Accrued interests and rent
II. Other deferred charges and prepaid expenses
Total assets
1
Companies in which we hold a participating interest.
7
8
15,632
49,528
227,014
474,724
140,532
5,472,733
5,290,044
12,438
350,371
427,924
790,733
289,692
133,756
423,448
292,174
615,256
119,479,921
114,309,666
50
Annual Report 2016
Allianz SE
C
Financial Statements of Allianz SE
Note
2016
2016
2016
2015
10
1,169,920
4,945
1,164,975
27,844,664
11,784,157
3,855,866
1,560,400
787,511
9,741,721
33,947
2,315,370
32,260
1,229
11,782,928
1,642,350
81,950
814,245
26,734
11,683,973
1,942,252
33,968
21
32,260
–
1,169,920
5,570
1,164,350
27,799,741
1,229
11,783,945
11,785,174
4,228,626
44,649,662
44,977,891
13,806,280
12,339,743
1,226,423
65,920
1,160,503
1,746,057
32,723
1,713,334
9,420,326
970,320
8,450,006
20,916
26
20,890
1,787,813
34,958
(95)
35,053
14,471,209
13,167,599
7,369,141
1,075,022
7,500,216
63,416
410,563
231,551
2,575,931
3,257,608
397,574
34,717,195
1,344,406
31,415,685
38,101,263
36,249,250
7,344
11,551
119,479,921
114,309,666
11, 14
12
13
14
14
14
€ thou
as of 31 December
Equity And LiAbiLitiES
A. Shareholders’ equity
I.
Issued capital
Less: mathematical value of own shares
II. Additional paid-in capital
III. Revenue reserves
1. Statutory reserves
2. Other revenue reserves
IV. Net earnings
B. Subordinated liabilities
C.
Insurance reserves
I. Unearned premiums
1. Gross
2. Less: amounts ceded
II. Aggregate policy reserves
1. Gross
2. Less: amounts ceded
III. Reserves for loss and loss adjustment expenses
1. Gross
2. Less: amounts ceded
IV. Reserves for premium refunds
1. Gross
2. Less: amounts ceded
V. Claims equalization and similar reserves
VI. Other insurance reserves
1. Gross
2. Less: amounts ceded
D. Other provisions
E. Funds held with reinsurance business ceded
F. Other liabilities
I. Accounts payable on reinsurance business
thereof to affiliated enterprises: € 269,609 thou (2015: € 135,928 thou)
thereof to participations1: € 11,968 thou (2015: € 9,180 thou)
II. Bonds
thereof to affiliated enterprises: € 2,575,931 thou (2015: € 3,257,608 thou)
III. Liabilities to banks
IV. Miscellaneous liabilities
including taxes of: € 21,626 thou (2015: € 10,956 thou)
thereof to affiliated enterprises: € 33,429,044 thou (2015: € 29,752,397 thou)
thereof to participations1: € 3 thou (2015: € 2 thou)
G. Deferred income
Total equity and liabilities
1
Companies in which we hold a participating interest.
Annual Report 2016
Allianz SE
51
C
Financial Statements of Allianz SE
Income Statement
€ thou
I. Technical account
1. Premiums earned (net)
a) Gross premiums written
b) Ceded premiums written
c) Change in gross unearned premiums
d) Change in ceded unearned premiums
Premiums earned (net)
2. Allocated interest return (net)
3. Other underwriting income (net)
4. Loss and loss adjustment expenses (net)
a) Claims paid
aa) Gross
bb) Amounts ceded in reinsurance
b) Change in reserve for loss and loss adjustment expenses (net)
aa) Gross
bb) Amounts ceded in reinsurance
Loss and loss adjustment expenses (net)
5. Change in other insurance reserves (net)
6. Expenses for premium refunds (net)
7. Underwriting expenses (net)
8. Other underwriting expenses (net)
9. Subtotal (Net underwriting result)
10. Change in claims equalization and similar reserves
11. Net technical result
II. Non-technical account
1. Investment income
2. Investment expenses
3. Investment result
4. Allocated interest return
5. Other income
6. Other expenses
7. Other non-technical result
8. Non-technical result
9. Net operating income
10. Income taxes
Amounts charged to other Group companies
11. Other taxes
12. Taxes
13. Net income
14. Unappropriated earnings carried forward
15. Net earnings
25
Note
2016
2016
2016
2015
16
10,820,290
(787,517)
(425,198)
17,098
10,032,773
(408,100)
17
18
19
20
(4,504,389)
(571,225)
(2,164,929)
896,657
(5,075,614)
(1,268,272)
21
22
5,084,886
(1,795,458)
3,289,428
(22,131)
2,718,536
(3,177,927)
9,624,673
21,025
72,789
8,328,023
(807,561)
7,520,462
(325,174)
(11,991)
(337,165)
7,183,297
58,631
434
(2,564,120)
305,455
(2,258,665)
(2,628,164)
(20,274)
(2,648,438)
(6,343,886)
(4,907,103)
6,725
(13,244)
(38,829)
(4,584)
(2,946,248)
(2,064,964)
(21,864)
399,970
(527,557)
(127,587)
3,267,297
(3,021)
223,861
(192,720)
31,141
8,130,158
(2,121,314)
6,008,844
(59,706)
5,949,138
2,507,577
(5,289,676)
23
(459,391)
(2,782,099)
24
(256,718)
522,931
266,213
1,082
2,807,906
2,680,319
267,295
3,167,039
3,198,180
(305,987)
663,974
357,987
(2,534)
355,453
2,947,614
3,553,633
908,252
674,993
3,855,866
4,228,626
52
Annual Report 2016
Allianz SE
C
Financial Statements of Allianz SE
Notes to the Financial Statements
Nature of operatioNs
aNd Basis of preparatioN
INVESTMENTS IN AFFILIATED
ENTERPRISES AND PARTICIPATIONS
NATURE OF OPERATIONS
Allianz SE, as the holding and reinsurance company of the Allianz
Group, is located at Königinstraße 28, 80802 Munich, and registered
in the Commercial Register of the municipal court in Munich under
HRB 164232.
BASIS OF PREPARATION
Our Financial Statements and the Management Report have been
prepared in accordance with the regulations in the German Com-
mercial Code (HGB), the German Stock Corporation Act (AktG), the
Law on the Supervision of Insurance Enterprises (VAG) and the
Go vernment Order on the External Accounting Requirements of
Insurance Enterprises (RechVersV).
All amounts in the financial statements are in thousands of
Euros (€ THOU), unless otherwise stated.
accouNtiNg, ValuatioN
aNd calculatioN Methods
INTANGIBLE ASSETS
Intangible assets are recorded at acquisition or construction cost less
depreciation. Internally generated intangible assets are capitalized
and depreciated on a straight-line basis. In case of a permanent
impairment, an unscheduled write-down is recognized.
REAL ESTATE, REAL ESTATE RIGHTS AND BUILDINGS, IN-
CLUDING BUILDINGS ON LAND NOT OWNED BY ALLIANZ SE
These items are recorded at acquisition or construction cost less
depreciation. Depreciation is measured according to ordinary useful
life. In case of a permanent impairment, the values of these items are
adjusted through unscheduled write-downs.
SHARES IN AFFILIATED ENTERPRISES
AND PARTICIPATIONS
These are recorded at cost less impairments, in accordance with
§ 341b (1) of the German Commercial Code in conjunction with
§ 253 (3) sentence 5 of the German Commercial Code.
Impairments are measured either as the difference between
acquisition cost and the respective value, in accordance with IDW RS
HFA 10 in conjunction with IDW S1, or as the difference between acqui-
sition cost and the lower share price as of 31 December 2016.
Where the market value at the balance sheet date was higher
than the previous year’s valuation, the value is written up to no more
than the historical acquisition cost.
LOANS IN AFFILIATED ENTERPRISES AND PARTICIPATIONS
These items are normally recorded at cost less impairments in accor-
dance with § 253 (3) sentence 5 of the German Commercial Code. How-
ever, when converting foreign currency loans into Euro at the report-
ing date the strict lower of cost or market value principle is applied.
OTHER INVESTMENTS
STOCKS, INTERESTS IN FUNDS, DEBT SECURITIES
AND OTHER FIXED AND VARIABLE INCOME SECURITIES,
MISCELLANEOUS INVESTMENTS
Generally, these items are valued in accordance with § 341b (2) of the
German Commercial Code in conjunction with § 253 (1), (4) and (5) of
the German Commercial Code using the acquisition cost or the
lower stock exchange or market value on the balance sheet date. We
calculate an average acquisition cost for securities of the same type
acquired at different cost. Long-term investments in mutual funds
are valued according to the regulations that apply to investments
pursuant to § 341b (2) of the German Commercial Code in conjunction
with § 253 (1) and (3) of the code using the moderate lower of cost or
market value principle.
REGISTERED BONDS, DEBENTURES AND LOANS
These items are recorded at cost less impairments in accordance
with § 253 (3) sentence 5 of the German Commercial Code. In accor-
dance with § 341c of the code, amortized cost accounting is applied
and the difference between acquisition cost and the redemption
amount is amortized over the remaining period, based on the effective
interest method.
Annual Report 2016
Allianz SE
53
C
Financial Statements of Allianz SE
SECURITIES TO MEET LIABILITIES RESULTING
FROM RETIREMENT PROVISION COMMITMENTS
These securities are valued at fair value in accordance with § 253 (1)
of the German Commercial Code, and offset against the liabilities in
accordance with § 246 (2) of the code. Pension plan reinsurance con-
tracts are recorded at asset value.
TANGIBLE FIXED ASSETS,
INVENTORIES AND MISCELLANEOUS ASSETS
These items are recorded at acquisition cost less depreciation. Low-
value assets costing up to € 150 are written off immediately. A com-
pound item for tax purposes formed in accordance with § 6 (2a) of the
German Income Tax Act (EStG) for assets from € 150 to € 1,000 is depre-
ciated by one fifth each year.
DEFERRED TAX ASSETS
When calculating deferred taxes, deferred tax assets and liabilities
are offset.
Based on the capitalization option in accordance with § 274 (1)
sentence 2 of the German Commercial Code, the surplus of deferred
tax assets over deferred tax liabilities is not recognized.
REMAINING ASSETS
These consist of the following:
− funds held by others under reinsurance business assumed,
− bank deposits,
− accounts receivables on reinsurance business,
− other receivables,
− cash with banks and cash on hand.
These items are recorded at face value less repayments and impair-
ments.
INSURANCE RESERVES
These consist of the following:
− unearned premiums,
− aggregate policy reserves,
− reserves for loss and loss adjustment expenses,
− reserves for premium refunds,
− claims equalization and similar reserves,
− other insurance reserves.
Insurance reserves are set up according to the German Commercial
Code and RechVersV requirements. The primary goal is to ensure our
ongoing ability to satisfy reinsurance contract liabilities in all cases.
Generally, the reinsurance reserves are booked according to the
cedent’s statements. For claims incurred but not yet reported, or not
sufficiently reported, additional reserves are calculated using actua-
rial techniques.
Insurance reserves in the ceded reinsurance business are calcu-
lated according to the terms of the retrocession contracts.
Written premiums for future periods are accrued in unearned
premiums.
Aggregate policy reserves for Life/Health reinsurance are gene-
rally recorded according to the amounts in the cedent’s statements.
Reserves for loss and loss adjustment expenses are established
for the payment of losses and loss adjustment expenses on claims
that have occurred but are not yet settled. Reserves for loss and loss
adjustment expenses fall into two categories: case reserves for
reported claims and reserves for incurred but not yet reported, or not
sufficiently reported, losses.
For Property-Casualty reinsurance, the equalization reserve, the
reserve for nuclear plants, the product liability reserve for major
pharmaceutical risks, and reserves for risks relating to terrorist
attacks are calculated according to § 341h of the German Commercial
Code in conjunction with § 29 and § 30 RechVersV. The reserves are set
up to moderate substantial fluctuations in the claims of individual
lines of business. In cases where above-average or below-average
claims occur, changes in the reserves mitigate the technical result for
the individual lines of business.
OTHER PROVISIONS
Pension provisions are calculated on the basis of actuarial principles.
In 2016, a new law (“Gesetz zur Umsetzung der Wohnimmobilien-
kreditrichtlinie und zur Änderung handelsrechtlicher Vorschriften”)
became effective, which included inter alia an amendment of § 253 of
the German Commercial Code, affecting the evaluation of pension
obligations. According to the new law, the discount rate used for cal-
culating the pension obligations has to be derived from a 10-year-
average, while it was derived from a 7-year-average before. A positive
difference resulting from the change of the valuation method is ear-
marked for profit distribution (§ 253 (6) sentence 2 of the German
Commercial Code). The aforementioned changes only apply for pen-
sion obligations, not for other provisions such as phased-in early
retirement benefits, long-term credit accounts, or jubilee payments.
54
Annual Report 2016
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Financial Statements of Allianz SE
Apart from that, with respect to the discount rate, the simplifica-
tion option set out in § 253 (2) sentence 2 of the German Commercial
Code has still been applied (duration of fifteen years). The effect
resulting from the change in the discount rate is reported under
other non-technical result.
The provisions for jubilee payments, birthday payments and
phased-in early retirement benefits are also calculated on the basis
of actuarial principles. For further information regarding the
accounting for pensions and similar obligations, please refer to note
13 to our financial statements.
Remaining other provisions are recognized at the settlement
amount. Long-term provisions are discounted applying the net
approach in accordance with IDW RS HFA 34.
REMAINING LIABILITIES
These consist of the following:
− subordinated liabilities,
− funds held with reinsurance business ceded,
− other liabilities.
These items are valued at the settlement amount. Annuities are
recorded at present value.
PREPAID EXPENSES AND DEFERRED INCOME
Accrued interest and rent are valued at nominal amounts. Premiums
and discounts carried forward as prepaid income and expenses are
amortized over the remaining life of the related financial instruments.
CURRENCY TRANSLATION
Transactions are generally recorded in the original currency and con-
verted into Euro at the relevant daily rate (middle forex spot rate).
Loans to affiliated enterprises denominated in foreign curren-
cies are converted into Euro with the middle forex spot rate as of the
reporting date and applying the strict lower of cost or market value
principle.
The valuation of foreign currency shares in affiliated enterprises
and participations, stocks, interests in funds, and other variable and
fixed-income securities is based on converting the value in the origi-
nal currency into Euros using the middle forex spot rate as of the
reporting date.
Comparing the acquisition cost in Euros with the value in Euro
as described above, the moderate lower-value principle is applied for
affiliated enterprises and participations. For other investments, the
strict lower of cost or market value principle is applied.
As a result of this valuation method, currency gains and losses
are not separately determined and shown as foreign exchange gains/
losses in the other non-technical result. Instead, the net effect of both
changes in currency exchange rates and value in original currency is
reflected in the impairments/reversals of impairments and realized
gains/losses calculated for these asset classes and is disclosed in the
investment result.
Issued debt securities and borrowings denominated in foreign
currencies are converted into Euro at the middle forex spot rate as of
the reporting date. Unrealized losses are recognized immediately in
the income statement, while unrealized gains are not.
All other monetary assets and liabilities recorded in foreign cur-
rency are valued at the middle forex spot rate as of the reporting date.
Exchange rate differences resulting from this valuation of foreign
currency positions are reflected in the other non-technical result.
VALUATION UNITS
In 2016, Allianz SE made use of the option of forming valuation units
as defined in § 254 of the German Commercial Code. This option is
used for derivative contracts in which Allianz SE acts as an intra-
group clearing agency. In this function, Allianz SE enters into deriva-
tive transactions with other Group companies and hedges the expo-
sure resulting from these transactions by entering into positions with
the same term and structure that are exact mirror images but entered
into with different business partners. Contrary positions whose per-
formance completely offset each other have been combined into
valuation units and form a perfect micro hedge.
When accounting for valuation units, the “freezing” method is
applied, in which the offsetting changes in value of the single posi-
tions which form a valuation unit are not recorded in the income
statement (see also note 15).
Annual Report 2016
Allianz SE
55
Values stated as of 1 January 2016
€ thou
5,842
7,038
5,800
18,680
254,389
66,733,105
6,470,912
507,226
–
73,711,243
1,270,904
23,671,056
1,588,389
124,388
1,071,676
27,726,413
101,692,045
101,710,725
%
0.2
65.6
6.4
0.5
–
72.5
1.2
23.3
1.6
0.1
1.1
27.3
100.0
Additions
(+)
€ thou
11,098
20
–
11,118
5,359
615,920
–
634
1,100
617,654
770,168
30,532,337
1,656,519
162,799
312,440
33,434,263
34,057,276
34,068,394
Transfers
€ thou
5,800
(5,800)
–
–
–
–
–
–
–
–
–
–
–
–
–
–
–
–
Disposals
(-)
€ thou
Revaluation
(+)
€ thou
Depreciation
(-)
€ thou
Net additions
(Net disposals)
Values stated as of 31 December 2016
486
2,880
–
2
–
2
2,892,776
23,900
5,261
–
2,921,937
291,271
26,760,446
638,221
8,172
–
27,698,110
30,620,533
30,620,535
–
–
–
–
–
–
–
–
–
–
–
–
5,117
4,128
–
9,245
11,799
51,234
166
1,439
–
–
–
–
–
3,993
98,333
118,235
102,326
105,206
105,206
118,235
182,873
192,118
€ thou
11,781
(4,110)
(5,800)
1,871
(4,046)
(2,328,090)
(24,066)
(6,066)
1,100
482,890
3,751,989
1,018,298
154,627
312,440
5,720,244
3,359,076
3,360,947
€ thou
17,623
2,928
–
20,551
250,343
64,405,015
6,446,846
501,160
1,100
1,753,794
27,423,045
2,606,687
279,015
1,384,116
33,446,657
105,051,121
105,071,672
52,839
(2,357,122)
71,354,121
%
0.2
61.3
6.1
0.5
–
67.9
1.7
26.1
2.5
0.3
1.3
31.9
100.0
C
Financial Statements of Allianz SE
Supplementary InformatIon on aSSetS
1 – Change of assets a., B.I. through B.III.
A.
Intangible assets
1. Self-produced industrial property rights and similar rights and assets
2. Licenses acquired against payment, industrial property rights and similar rights
and assets as well as licenses for such rights and assets
3. Advance payments made
Subtotal A.
B.I.
Real estate, real estate rights and buildings,
including buildings on land not owned by Allianz SE
B.II.
Investments in affiliated enterprises and participations
1. Shares in affiliated enterprises
2. Loans to affiliated enterprises
3. Participations
4. Loans to participations
Subtotal B.II.
B.III. Other investments
1. Stocks, interests in funds and other variable-income securities
2. Debt securities and other fixed-income securities
3. Other loans
a) Registered bonds
b) Loans and promissory notes
4. Bank deposits
Subtotal B.III.
Subtotal B.I. - B.III.
Total
2 – Intangible assets
The book value of intangible assets totaled € 21 MN (2015: € 19 MN) and
mainly consists of internally generated software.
In 2016 the research and development costs of Allianz SE
amounted to € 11 MN and represent in total the development costs for
the internally generated software.
3 – Market value of investments
Fair value and carrying amount of the investments, subdivided into
individual asset categories, were as follows:
Book VAluES And MArkEt VAluES of InVEStMEntS
€ Bn
Book value
Market value
Valuation reserve
as of 31 December
Real estate
Equity securities
Debt securities
Loans
Bank deposits
Funds held by others under reinsurance business assumed
2016
0.3
66.7
27.4
9.3
1.4
8.0
2015
0.3
68.5
23.6
8.2
1.1
6.1
2016
0.7
76.1
28.1
10.6
1.4
8.0
2015
0.5
74.5
24.1
9.2
1.1
6.1
113.1
107.8
124.9
115.5
11.8
2016
2015
0.4
9.4
0.7
1.3
–
–
0.2
6.0
0.5
1.0
–
–
7.7
Annual Report 2016
Allianz SE
Total
56
Supplementary InformatIon on aSSetS
1 – Change of assets a., B.I. through B.III.
A.
Intangible assets
1. Self-produced industrial property rights and similar rights and assets
2. Licenses acquired against payment, industrial property rights and similar rights
and assets as well as licenses for such rights and assets
3. Advance payments made
Subtotal A.
B.I.
Real estate, real estate rights and buildings,
including buildings on land not owned by Allianz SE
B.II.
Investments in affiliated enterprises and participations
1. Stocks, interests in funds and other variable-income securities
2. Debt securities and other fixed-income securities
1. Shares in affiliated enterprises
2. Loans to affiliated enterprises
3. Participations
4. Loans to participations
Subtotal B.II.
B.III. Other investments
3. Other loans
a) Registered bonds
b) Loans and promissory notes
4. Bank deposits
Subtotal B.III.
Subtotal B.I. - B.III.
Total
Values stated as of 1 January 2016
€ thou
5,842
7,038
5,800
18,680
254,389
66,733,105
6,470,912
507,226
–
73,711,243
1,270,904
23,671,056
1,588,389
124,388
1,071,676
27,726,413
101,692,045
101,710,725
%
0.2
65.6
6.4
0.5
–
72.5
1.2
23.3
1.6
0.1
1.1
27.3
100.0
Additions
(+)
€ thou
11,098
20
–
11,118
5,359
615,920
–
634
1,100
617,654
770,168
30,532,337
1,656,519
162,799
312,440
33,434,263
34,057,276
34,068,394
C
Financial Statements of Allianz SE
Transfers
€ thou
5,800
–
(5,800)
–
–
–
–
–
–
–
–
–
–
–
–
–
–
–
Disposals
(-)
€ thou
Revaluation
(+)
€ thou
Depreciation
(-)
€ thou
–
2
–
2
–
–
–
–
486
2,880
2,892,776
23,900
5,261
–
2,921,937
291,271
26,760,446
638,221
8,172
–
27,698,110
30,620,533
30,620,535
–
–
–
–
–
3,993
98,333
–
–
–
102,326
105,206
105,206
5,117
4,128
–
9,245
11,799
51,234
166
1,439
–
52,839
–
118,235
–
–
–
118,235
182,873
192,118
Net additions
(Net disposals)
Values stated as of 31 December 2016
€ thou
11,781
(4,110)
(5,800)
1,871
(4,046)
(2,328,090)
(24,066)
(6,066)
1,100
€ thou
17,623
2,928
–
20,551
250,343
64,405,015
6,446,846
501,160
1,100
(2,357,122)
71,354,121
482,890
3,751,989
1,018,298
154,627
312,440
5,720,244
3,359,076
3,360,947
1,753,794
27,423,045
2,606,687
279,015
1,384,116
33,446,657
105,051,121
105,071,672
%
0.2
61.3
6.1
0.5
–
67.9
1.7
26.1
2.5
0.3
1.3
31.9
100.0
VALUATION METHODS USED
TO DETERMINE THE MARKET VALUE
REAL ESTATE
Land and buildings are valued using the discounted cash flow
me thod or, for new buildings, at cost. The fair value was determined
during the fiscal year.
EQUITY SECURITIES
Investments in companies quoted on the stock exchange are gene
rally measured by the stock exchange price quoted on the last trading
day of 2016. Nonquoted companies are valued at their net asset value
calculated by the German Association for Financial Analysis and
Asset Management’s (DVFA) method. For recent transactions the
transaction prices were used.
DEBT SECURITIES
These items are measured at the stock exchange value quoted on the
last trading day of 2016 or, if there is no active market, at the prices
obtained from brokers or pricing services.
LOANS
Loans are valued using the discounted cash flow method. The rele
vant discount rates are derived from observable market parameters
and reflect the remaining life and credit risk of the instruments.
BANK DEPOSITS AND FUNDS HELD BY OTHERS
UNDER REINSURANCE BUSINESS ASSUMED
There are no differences between the book value and the fair value of
those items.
Annual Report 2016
Allianz SE
57
C
Financial Statements of Allianz SE
4 – Investments in affiliated enterprises
and participations
Allianz SE holds more than 10.0 % of the respective shares of these
investment funds. The fund shares can be redeemed each trading
day.
€ Bn
as of 31 December
Shares in affiliated enterprises
Loans to affiliated enterprises
Participations
Total
2016
64.4
6.5
0.5
71.4
2015
66.7
6.5
0.5
73.7
Change
(2.3)
–
–
(2.3)
6 – Other receivables
The slight increase of € 228 MN in this position consists of a marginal
rise of intragroup (€ 119 MN) and tax receivables (€ 127 MN).
The book value of shares in affiliated enterprises went down by € 2.3 BN
to € 64.4 BN (2015: € 66.7 BN). This decrease consists of the following:
7 – Miscellaneous assets
At the end of the fiscal year, this position mainly included variation
margins paid in connection with financial derivative transactions
(€ 223 MN).
8 – Deferred charges and prepaid expenses
This item includes accrued interests in the amount of € 475 MN (2015:
€ 290 MN), which mainly result from our investments in debt securities
and loans, as well as other deferred charges and prepaid expen ses
amounting to € 140 MN (2015: € 134 MN). The latter comprise upfront
payments for swap contracts and the discount on borrowings from
affiliated enterprises, issued bonds and subordinated liabilities.
9 – Collateral
Assets amounting to € 1.0 BN (2015: € 0.8 BN), of which € 0.6 BN (2015:
€ 0.6 BN) were in favor of affiliated enterprises, were pledged as col
lateral for liabilities.
− € 2.3 BN capital reduction of our subsidiary AZArges Vermögens
verwaltungsgesellschaft mbH following the transfer of intra
group debt to another Group company,
− further capital decreases amounting to overall € 0.6 BN, thereof
€ 0.4 BN at Allianz Deutschland AG and € 0.2 BN at Allianz Asset
Management AG,
− book value increase by € 0.3 BN due to the acquisition of the two
Moroccan campanies Allianz Maroc S.A. and Marofinac S.à.r.l.
from Zurich Insurance Company Ltd.,
− further various purchases and capital increases of Group compa
nies raising the book value once more by overall € 0.3 BN.
5 – Interests in investment funds
Details on interests in investment funds in accordance with § 285 (26)
of the German Commercial Code:
€ thou
Equity funds
Allianz Discovery Asia
Strategy Fund
Allianz Global Emerging
Markets Equity Dividend Fund
Subtotal equity funds
Bond funds
Book value
Fair value
Valuation
reserve
Dividend
distribution
3,910
4,346
3,000
6,910
3,396
7,742
436
396
832
–
97
97
Allianz RE Asia Fund
1,033,241
1,131,161
97,920
18,364
PIMCo Covered Bond Source
uCItS EtF
Allianz Emerging Markets
Local Currency Bond Fund
Allianz Emerging Markets
Flexible Bond Fund
PIMCo Select Funds
u.S. High Yield BB-B Bond
99,199
105,806
6,607
4,021
4,021
3,922
4,531
–
609
779
212
218
98,902
98,902
–
4,868
AZRE AZD P & C Master Fund
490,692
533,909
43,217
Allianz SE – PD Fund
Subtotal bond funds
Mixed funds
Allianz Global Dynamic Multi
Assets Income
12,330
12,855
525
1,742,307
1,891,185
148,878
24,441
3,890
4,186
296
69
–
–
Total
1,753,107
1,903,113
150,006
24,607
58
Annual Report 2016
Allianz SE
C
Financial Statements of Allianz se
Supplementary InformatIon on equIty and lIabIlItIeS
10 – Shareholders’ equity
secured by the Conditional Capital 2010/2014. On or before 31 Decem-
ber 2016, there was no conversion of any such notes into new shares.
ISSUED CAPITAL
Issued capital as of 31 December 2016 amounted to € 1,169,920.0 THOU
divided into 457,000,000 registered shares. The shares have no-par
value but a mathematical per-share value of € 2.56 each as a propor-
tion of the issued capital.
CHANGES IN THE NUMBER
OF ISSUED SHARES OUTSTANDING
number of issued shares outstanding
AUTHORIZED CAPITAL
As of 31 December 2016, Allianz SE had authorized capital for the
issuan ce of 214,843,750 shares until 6 May 2019, with a notional
amount of € 550,000.0 THOU (Authorized Capital 2014/I). The share-
holders’ subscription rights can be excluded for capital increases
against contribution in kind. For a capital increase against contribu-
tions in cash, the shareholders’ subscription rights can be excluded:
(i) for fractional amounts, (ii) if the issue price is not significantly
below the market price and the shares issued under exclusion of the
subscription rights pursuant to § 186 (3) sentence 4 of the German
Stock Corporation Act (Aktiengesetz) do not exceed 10 % of the share
capital, and (iii) to the extent necessary to grant a subscription right
for new shares to the holders of bonds that carry conversion or option
rights or provide for mandatory conversion. The subscription rights
for new shares from the Authorized Capital 2014/I and the Condi-
tional Capital 2010/2014 may only be excluded for the proportionate
amount of the share capital of up to € 233,728.0 THOU (corresponding
to 20 % of the share capital at year-end 2013).
In addition, Allianz SE has authorized capital (Authorized Capi-
tal 2014/II) for the issuance of shares against cash until 6 May 2019.
The shareholders’ subscription rights can be excluded in order to
issue new shares to employees of Allianz SE and its Group companies.
As of 31 December 2016, the Authorized Capital 2014/II amounted to
€ 13,720.0 THOU (5,359,375 shares).
CONDITIONAL CAPITAL
As of 31 December 2016, Allianz SE had conditional capital totaling
€ 250,000.0 THOU (97,656,250 shares) (Conditional Capital 2010/2014).
This conditional capital increase will only be carried out if conversion
or option rights attached to bonds which Allianz SE or its Group com-
panies have issued against cash payments according to the resolu-
tions of the AGM on 5 May 2010 or 7 May 2014 are exercised or the con-
version obligations under such bonds are fulfilled, and only to the
extent that the conversion or option rights or conversion obligations
are not serviced through treasury shares or through shares from
authorized capital.
Convertible subordinated notes totaling € 500,000.0 THOU, which
may be converted into Allianz shares, were issued against cash in July
2011. Within 10 years after the issuance a mandatory conversion of
the notes into Allianz shares at the then prevailing share price may
apply if certain events occur, subject to a floor price of at least € 74.90
per share. Within the same period, the investors have the right to
convert the notes into Allianz shares at a price of € 187.26 per share.
Both conversion prices are subject to anti-dilution provisions. The
subscription rights of shareholders for these convertible notes have
been excluded with the consent of the Supervisory Board and pur-
suant to the authorization of the AGM on 5 May 2010. The granting of
new shares to persons entitled under such convertible notes is
Number of issued shares outstanding
as of 1 January
Changes in number of treasury shares
Number of issued shares outstanding
as of 31 December
Treasury shares1
Total number of issued shares
2016
2015
454,823,638
454,248,039
244,099
575,599
455,067,737
454,823,638
1,932,263
2,176,362
457,000,000
457,000,000
1
Thereof 1,931,677 (2015: 2,175,776) own shares held by Allianz Se.
PROPOSAL FOR APPROPRIATION OF NET EARNINGS
The Board of Management and the Supervisory Board propose that
the net earnings (“Bilanzgewinn”) of Allianz SE of € 3,855,866,165.01
for the 2016 fiscal year shall be appropriated as follows:
− Distribution of a dividend of € 7.60 per no-par share
entitled to a dividend: € 3,458,515,257.20
− Unappropriated earnings carried forward: € 397,350,907.81
The proposal for appropriation of net earnings reflects the 1,932,203
treasury shares held directly and indirectly by the company at the
time of the preparation (“Aufstellung”) of the annual financial state-
ments by the Board of Management on 14 February 2017. Such trea-
sury shares are not entitled to the dividend pursuant to § 71b of the
German Stock Corporation Act (AktG). Should there be any change in
the number of shares en titled to the dividend by the date of the An nual
General Meeting, the above proposal will be amended accor dingly
and presented for resolution on the appropriation of net ear nings at
the Annual General Meeting, with an unchanged dividend of € 7.60
per each share entitled to dividend.
TREASURY SHARES
As of 31 December 2016, Allianz SE held 1,931,677 (2015: 2,175,776) trea-
sury shares. Of these, 905,648 (2015: 1,522,732) were held for covering
future subscriptions by employees in Germany and abroad in the
context of Employee Stock Purchase Plans, whereas 1,026,029 (2015:
653,044) were held as a hedge for obligations from the Allianz Equity
Incentive Program (former Group Equity Incentive Program).
In the year ending 31 December 2016, 617,084 (2015: 575,584)
shares were sold to employees of Allianz SE, as well its subsidiaries in
Germany and abroad, in the context of the Employee Stock Purchase
Plan. These shares were taken from the stock of treasury shares
de dicated to this purpose. In 2016, as in the previous year, no capital
increase for the purpose of Employee Stock Purchase Plans was
undertaken. Employees of the Allianz Group purchased shares at
prices ranging from € 94.54 (2015: € 98.42) to € 121.84 (2015: € 125.84)
per share. As of 31 December 2016, the remaining treasury shares of
Allianz SE held for covering subscriptions by employees in the context
of the Employee Stock Purchase Plan of Allianz SE and its subsidiaries
in Germany and abroad amounted to 905,648 shares.
Annual Report 2016
Allianz SE
59
C
Financial Statements of Allianz se
In July 2016, Allianz SE purchased 1,189,514 treasury shares at an
average price of € 122.08 for the purpose of hedging obligations from
the Allianz Equity Incentive Program. For reasons of hedge accoun-
ting, Allianz SE reduced this position of treasury shares in August 2016
by 816,529 shares at an average price of € 129.78 and, at the same time,
entered into corresponding forward transactions on Allianz shares at
an identical reference price. As of 31 December 2016, the remaining
treasury shares of Allianz SE held as a hedge for obligations from the
Allianz Equity Incentive Program amounted to 1,026,029 shares.
In the year ending 31 December 2016, the total number of treasury
shares of Allianz SE decreased by 244,099 (2015: decrease of 575,584)
shares, which corresponds to € 624,893 (2015: € 1,473,495) or 0.05 %
(2015: 0.126 %) of issued capital.
The treasury shares of Allianz SE and its subsidiaries represent
€ 4,945 THOU (2015: € 5,571 THOU) or 0.42 % (2015: 0.48 %) of the issued
capital.
BAR ON DIVIDEND DISTRIBUTION
The unappropriated reserves plus the unappropriated earnings car-
ried forward are not fully available for the distribution of a dividend
due to legal restrictions.
The unappropriated reserves of Allianz SE correspond to the
other revenue reserves.
The unappropriated reserves plus the unappropriated earnings
carried forward are barred from dividend distribution totaling the
amount of € 772,254 THOU (2015: € 11,412 THOU). Of this amount
€ 749,686 THOU (2015: € 0 THOU) are due to the new legal provision for
discounting pension obligations according to § 253 (2) sentence 1 in
conection with § 253 (6) of the German Commercial Code. Another,
€ 4,945 THOU (2015: € 5,570 THOU) relate to the mathematical value of
own shares deducted from issued capital according to § 272 (1a) of
the German Commercial Code. Furthermore, € 17,623 THOU (2015:
€ 5,842 THOU) account for internally generated intangible assets
according to § 268 (8) of the German Commercial Code.
additional paid-in capital
€ thou
as of 31 December 2015
Own shares: realized gains
as of 31 December 2016
revenue reserves
€ thou
as of 31 December
1. Statutory reserves
2. Other revenue reserves1
Total
27,799,741
44,923
27,844,664
Own shares
exceeding
mathematical
value
–
2015
1,229
2016
1,229
11,783,945
11 785 174
(1,017)
11,782,928
(1,017)
11 784 157
1
Thereof reserves for own shares € 4,945 tHou (2015: € 5,570 tHou).
11 – Subordinated liabilities
Subordinated liabilities increased to € 13.8 BN in 2016 (2015: € 12.3 BN).1
€ 8.9 BN (2015: € 7.5 BN) were external subordinated liabilities resul ting
from bonds issued by Allianz SE directly. In 2016, Allianz SE placed a
new subordinated bond with a volume of USD 1.5 BN (equals € 1.4 BN).
In addition, intra-group subordinated liabilities amounting to
€ 4.9 BN (2015: € 4.9 BN) were attributable to subordinated bonds
issued by Allianz Finance II B.V., an affiliated enterprise that usually
transfers the proceeds from these issues to Allianz SE via intra-group
loans. Allianz SE provides a financial guarantee for the total amount
of bonds issued by Allianz Finance II B.V.
12 – Insurance reserves
€ mn
as of 31 December
Motor
Fire and property reinsurance
Liability
Life
Marine and aviation
Credit and bond
Personal accident
Legal expenses
Health
Other lines
Total
Unearned
premiums
Aggregate policy
reserves
Reserves for
loss and loss
adjustment
expenses
Reserves
for premium
refunds
Claims
equalization and
similar reserves
Other insurance
reserves
433
482
217
38
26
–
37
46
3
278
1,560
–
–
–
748
–
–
38
–
2
–
788
2,438
2,119
3,062
93
530
409
466
256
11
358
9,742
–
9
4
–
–
21
–
–
–
–
34
327
601
393
–
66
440
2
19
–
467
2,315
7
8
4
6
–
1
2
2
–
2
32
Total
3,205
3,219
3,680
885
622
871
545
323
16
1,105
14,471
The development of the insurance reserves was mainly influenced by
the new quota share agreements with European entities.
1
Due to roundings of the single amounts for external and intra-group subordinated liabilities explained
below, the 2015 amounts do not exactly sum up to the total value.
60
Annual Report 2016
Allianz SE
C
Financial Statements of Allianz se
AGGREGATE POLICY RESERVES
Aggregate policy reserves declined by € 926 MN to € 788 MN due to the
Life/Health reinsurance.
RESERVES FOR LOSS AND LOSS ADJUSTMENT EXPENSES
Reserves for loss and loss adjustment expenses increased by 15.3 % to
€ 9,742 MN, mainly driven by the growth of the portfolio.
CLAIMS EQUALIZATION AND SIMILAR RESERVES
In 2016, claims equalization and similar reserves rose by € 528 MN to
€ 2,315 MN, mainly driven by the substantial premium growth as well
as the positive underwriting result. The increase resulted mainly
from fire reinsurance (€ 183 MN), other reinsurance lines (€ 122 MN),
motor reinsurance (€ 106 MN) and liability reinsurance (€ 45 MN).
13 – Other provisions
development of other provisions
€ thou
Provisions for pensions and similar liabilities
Tax provisions
Miscellaneous
1. Anticipated losses
2. Remaining provisions
Total
1
Including currency translation effects.
Provision
1 January 2016
6,306,863
410,928
421,533
360,892
7,500,216
Use
(-)
259,370
4,843
260,890
213,182
738,285
Release1
Additions1
(-)
159,036
239
48,261
18,474
226,010
(+)
41,508
135,384
222,618
292,332
691,842
Reversal of
Discounting
Provision
(+)
31 December 2016
136,837
–
1,896
2,645
141,378
6,066,802
541,230
336,896
424,213
7,369,141
The total of other provisions declined by € 131 MN. This decrease
resulted mainly from a net reduction of the pension liability of € 240 MN
which was partially offset by an increase of the tax provisions by
€ 130 MN. The miscellaneous provisions slimmed down by € 21 MN. In
this connection, the provisions for anticipated losses dropped by
€ 85 MN, whereas the remaining provisions grew by € 63 MN.
Allianz SE has made pension promises for which pension provi-
sions are recognized. Part of these pension obligations are secured by
a “Contractual Trust Arrangement” (Methusalem Trust e.V.). These
trust assets constitute offsettable plan assets, with the asset value/
market value being used as the fair value.
In 1985, the pension obligations of the German subsidiaries were
centralized by transferring the corresponding assets to Allianz SE. As
a result, Allianz SE has a joint liability for a large part of these old
pension promises. The German subsidiaries reimburse the costs,
whereas Allianz SE has assumed responsibility for settlement. Conse-
quently, these pension obligations are reported by Allianz SE.
In 2015, the cost allocation contract was renegotiated with the
result that, besides covering the interest cost, Allianz SE will also
carry the interest rate risk for future years. In addition to that,
Allianz SE completely assumed the obligations resulting from the
agents pension fund (“Vertreterversorgungswerk” – VVW) from
Allianz Beratungs- und Vertriebs-AG as of 1 January 2015.
The following table shows a breakdown of pension liabilities:
settlement amount of the offset liabilities
€ thou
as of 31 December
2016
2015
Old pension promises of the German subsidiaries
1,808,224
1,885,919
Pension promises of Allianz SE
Vertreterversorgungswerk
old pension promises given to employees
contribution based pension plans
deferred compensation
Total
4,285,330
4,427,543
194,941
184,826
87,006
201,115
162,443
74,879
6,560,327
6,751,899
The settlement amount is calculated on the basis of the projected
unit credit method and/or reported as the present value of the entitle-
ments acquired. In case of security linked pension plans the fair value
of the offset assets is shown.
Due to the fact that there is no employment relationship between
the tied agents and Allianz SE and as Allianz Beratungs- und Ver-
triebs-AG does no longer reimburse any costs, pension obligations
resulting from the VVW equals the full present value.
Annual Report 2016
Allianz SE
61
C
Financial Statements of Allianz se
actuarial parameters
%
as of 31 December
Applied discount rate (10-year-average)1
Applied discount rate (7-year-average)1
Rate of assumed pension trend
Rate of assumed salary increase
(incl. average career trend)
2016
4.01
3.23
1.50
3.25
2015
–
3.89
1.70
3.25
1
The discount rate as of 31 December 2015 was derived based on the up to 31 December 2015 effective
German regulation on the discounting of provisions (“Rückstellungsabzinsungsverordnung”) from a
7-year-average. Due to an amendment of German Commercial code, the discount rate as of 31 December
2016 was derived from a 10-year-average for pensions, while the derivation for other provisions remained
unchanged and is still based on a 7-year-average.
As opposed to the above rates, part of the pension promises are cal-
culated with the guaranteed interest rate of 2.75 % p. a. and the guar-
anteed pension increase rate of 1 % p. a. of these pension promises.
The mortality tables used are the current RT2005G-tables of Heu-
beck, which have been adjusted with respect to mortality, disability,
and labor turnover to reflect company-specific circumstances.
The retirement age applied is the contractual or legal retirement
age.
supplementary information
€ thou
as of 31 December
Historical costs of the offset assets
14 – Maturity of financial liabilities
The residual terms of subordinated liabilities, issued bonds and mis-
cellaneous liabilities are as follows:
maturity table as of 31 december 2016
€ thou
Total
Term
< 1 year
Term
1 – 5 years
Term
> 5 years
Subordinated liabilities (b.)
Intra-group transmission of
proceeds from third-party
financing
Subordinated bonds
issued by Allianz SE
Subtotal
subordinated liabilities (B.)
4,868,974
168,974
8,937,306
100,658
13,806,280
269,632
–
–
–
4,700,000
8,836,648
13,536,648
Bonds (intra-group – F.II.)
2,575,931
379,931
1,800,000
396,000
Liabilities to banks (F.III.)
397,574
397,574
–
–
Miscellaneous liabilities (f.iv.)
Intra-group transmission of
proceeds from third-party
financing
5,177,377
173,745
2,625,000
2,378,632
Other intra-group liabilities1
28,251,667
27,059,263
1,092,404
100,000
Subtotal intra-group
miscellaneous liabilities
33,429,044
27,233,008
3,717,404
2,478,632
Liabilities to third parties
1,288,151
1,288,151
–
–
2016
2015
Subtotal
miscellaneous liabilities
488,562
443,067
Total
34,717,195
28,521,159
3,717,404
2,478,632
51,496,980
29,568,296
5,517,404
16,411,280
Settlement amount of the offset liabilities
6,560,327
6,751,899
(-) Fair value of the offset assets
493,525
445,036
Provisions for pensions and similar liabilities
6,066,802
6,306,863
1
As of 31 December 2016, other intra-group liabilities due within one year amounted to € 27.1 bn. Thereof,
cash pool and intra-group loans accounted for € 9.3 bn and € 17.0 bn, respectively. Upon maturity, intra-
group loans are rolled forward by Allianz Se on a regular basis.
Allianz SE has obligations resulting from jubilee payments, a long-
term credit account, birthday payments, and phased-in early retire-
ment, which are reported under remaining provisions.
These obligations are basically calculated in the same way as the
pension obligations, using the same actuarial assumptions (except
for the discount rate).
Offsettable plan assets are held at Methusalem Trust e.V. to
secure the phased-in early retirement and long-term credit account
obligations. The asset value/market value is used as the fair value.
The following table shows a breakdown of the offset assets and
liabilities resulting from the phased-in early retirement and long-
term credit account obligations.
information on the offset assets and liabilities
€ thou
as of 31 December
Historical costs of the offset assets
Settlement amount of the offset liabilities
Fair value of the offset assets
2016
19,513
19,691
20,530
2015
14,168
15,115
14,311
maturity table as of 31 december 2015
€ thou
Total
Term
< 1 year
Term
1 – 5 years
Term
> 5 years
Subordinated liabilities (b.)
Intra-group transmission of
proceeds from third-party
financing
Subordinated bonds
issued by Allianz SE
Subtotal
subordinated liabilities (B.)
4,868,645
168,645
7,471,098
90,730
12,339,743
259,375
–
–
–
4,700,000
7,380,368
12,080,368
Bonds (intra-group – F.II.)
3,257,608
841,608
2,020,000
396,000
Liabilities to banks (F.III.)
1,344,406
1,344,406
–
–
Miscellaneous liabilities (f.iv.)
Intra-group transmission of
proceeds from third-party
financing
4,831,235
438,665
1,875,000
2,517,570
Other intra-group liabilities1
24,921,162
22,668,032
1,253,130
1,000,000
Subtotal intra-group
miscellaneous liabilities
29,752,397
23,106,697
3,128,130
3,517,570
Liabilities to third parties
1,663,288
1,663,288
–
–
Subtotal
miscellaneous liabilities
31,415,685
24,769,985
3,128,130
3,517,570
Total
48,357,442
27,215,374
5,148,130
15,993,938
1
As of 31 December 2015, other intra-group liabilities due within one year amounted to € 22.7 bn. Thereof,
cash pool liabilities and intra-group loans accounted for € 8.3 bn and € 13.5 bn, respectively. Upon
maturity, intra-group loans are rolled forward by Allianz Se on a regular basis.
As of 31 December 2016, € 0.6 BN (2015: € 0.5 BN) of the total financial
liabilities were secured by assets pledged as collateral.
62
Annual Report 2016
Allianz SE
C
Financial Statements of Allianz se
15 – Information about derivative financial instruments
options dealing in shares and share indices as of 31 december 2016
Class
Long call
Short call
Short call
Long put
Short put
Nominal
€ thou
25,155
25,155
13,984
37,923
37,923
Fair value
€ thou
2,661
(2,661)
(11,147)
290
(290)
Book value
Underlying
Balance sheet
position
€ thou
2,507
2,507
Share index
Share index
Assets D.III.
Liabilities F.IV.
11,147
Allianz SE share
Liabilities F.IV.
321
304
17
Share index
Assets D.III.
Share index
Liabilities F.IV.
Liabilities D.
The options on Allianz SE shares are held in the context of hedging
the Allianz Equity Incentive Plans.
The options on stock indices are held in the context of hedging
activities of other entities of the Allianz Group. Allianz SE hedged
intra-group positions by entering into countertrades at the market.
Both intra-group and group-external positions were combined to
valuation units (“Bewertungseinheiten”) representing perfect micro
hedges. The completely offsetting changes in value of the single posi-
tions are recorded neither in the income statement nor on the
ba lance sheet.
European-type options are valued using the Black Scholes mo del
and American-type options using the binomial model based on the
closing price on the valuation date. Yield curves are derived from the
swap rates prevailing on the valuation date. The future dividend yield
is estimated on the basis of market information on the valuation
date. Volatility is calculated based on currently traded implicit vola-
tility, taking into account the residual term and the ratio between the
strike price and the prevailing share price.
forward contracts in shares, share indices and hedge rsu as of 31 december 2016
Class
Long forward
Long forward
Long future
Short forward
Hedge RSu
Nominal
€ thou
466,926
183,415
78,448
183,415
298,941
Fair value
Book value
Underlying
Balance sheet
position
€ thou
71,674
(10,573)
–
10,573
(412,531)
€ thou
–
–
–
–
Allianz SE share
UniCredit S.p.A.
share
Allianz SE share
UniCredit S.p.A.
share
–
–
–
–
412,531
Allianz SE share
Liabilities F.IV.
The positions in long forwards and futures on Allianz SE shares and
in hedge RSU are held in the context of hedging the Allianz Equity
Incentive Plans.
For the purpose of hedging the share price risk of UniCredit S.p.A.
shares, our subsidiary Allianz Finance II Louxembourg S.à.r.l. entered
into short forwards on UniCredit S.p.A. shares with Allianz SE.
Allianz SE hedged these positions by entering into countertrades at
the market. Both intra-group and group-external positions were com-
bined to form valuation units (“Bewertungseinheiten”) representing
perfect micro hedges. The completely offsetting changes in value of
the single positions are recorded neither in the income statement nor
on the balance sheet.
The fair value of a forward contract is determined as the diffe-
rence between the underlying closing price on the valuation date and
the discounted forward price. The net present value of dividend pay-
ments due before maturity of the forward contract is also taken into
account, unless dividends are subject to a pass-through agreement.
Liabilities from hedge RSU, which the Group companies acquire from
Allianz SE to hedge their liabilities from the Group Equity Incentive
programs, are valued on the basis of the Allianz closing price on the
valuation date minus the net present value of estimated future divi-
dends due before maturity of the respective hedge RSU. Applicable
discount rates are derived from inter polated swap rates.
Annual Report 2016
Allianz SE
63
C
Financial Statements of Allianz se
forward currency contracts as of 31 december 2016
Class
Long forward
Short forward
Nominal
€ thou
Fair value
Book value
€ thou
€ thou
Underlying
Balance sheet
position
6,912,301
50,915
27,673
8,972,705
(175,084)
185,212
AED, AUD, BRL, CAD, CHF, CNY, COP, CZK, DKK, GBP,
HKD, HUF, JPY, KRW, MYR, NOK, NZD, PLN, QAR, SAR,
SEK, SGD, THB, TRY, TWD, USD
AED, AUD, BRL, CAD, CHF, COP, CZK, DKK, GBP, HKD,
INR, JPY, MYR, NOK, NZD, QAR, SAR, SEK, SGD, THB,
TRY, USD, ZAR
Liabilities D.
Liabilities D.
Allianz SE holds long and short positions in various currencies in
order to manage foreign exchange risk within Allianz SE and other
entities of the Allianz Group.
The fair value of a forward currency contract is the difference
between the discounted forward price and the spot rate in Euros. The
discounted forward price is calculated by applying the Euro interest
rate as a discount rate and the foreign currency interest rate as a
compound interest rate.
Long forwards and short forwards with a nominal value of
€ 1.7 BN and a fair value of € 11.3 MN, respectively, were aggregated to
form valuation units (“Bewertungseinheiten”) and accounted for
with a book value of zero. In each case, diametrical positions with
identical terms and conditions closed with intra-group and group-
external counterparts, respectively, form a perfect micro hedge
because the fair value changes of the diametric positions completely
compensate each other.
swap contracts as of 31 december 2016
Class
Receiver swap EuR
Receiver swap GBP
Nominal
€ thou
1,500,000
269,447
Fair value
€ thou
11,273
95,572
Book value
Underlying
€ thou
Long-term interst
rate positions
–
71,608
Long-term interst
rate positions
Balance sheet
position
–
Assets E.II.
Allianz SE holds receiver swaps in various currencies in order to hedge
interest rate risk arising from interest rate positions of Allianz SE or
other entities of the Allianz Group.
The fair value of an interest rate swap is the aggregate net pre-
sent value of all expected incoming and outgoing cash flows of the
respective swap transaction.
Within the financial participations, there are put and call options on
company shares which are linked to certain conditions. Due to the
lack of quoted prices on active markets for these financial participa-
tions and the uncertainty regarding the occurrence of the option
conditions, it is not possible to reliably determine the fair value of
such options. Wherever feasible, contractual arrangements inclu-
ding the option agreements were taken into account when determin-
ing the fair value of the financial participation. However, no stand-
alone valuation of the options as derivative financial instruments
was performed.
64
Annual Report 2016
Allianz SE
C
Financial Statements of Allianz SE
Supplementary InformatIon on the Income Statement
16 – Gross premiums written
20 – Underwriting expenses (net)
€ thou
Property-Casualty reinsurance
Life/Health reinsurance
Total
2016
2015
10,385,480
7,769,191
434,810
558,832
€ thou
Gross
Ceded
10,820,290
8,328,023
Net
2016
2015
(3,063,930)
(2,296,970)
117,682
232,006
(2,946,248)
(2,064,964)
Gross premiums written increased by 29.9 % to € 10,820 MN. This was
mainly due to new quota share agreements with European Allianz
entities that contributed gross premiums written of € 2,897 MN.
The rise in underwriting expenses (net) was mainly due to the new
quota share agreements with European Allianz entities. In addition,
lower internal and external retrocessions led to a decrease of com-
missions received.
17 – Allocated interest return (net)
21 – Investment income
The amount of interest income transferred under this heading from
the non-technical section to the technical section was calculated in
accordance with § 38 RechVersV and decreased by € 38 MN to € 21 MN.
€ thou
18 – Run-off result
In 2016, the positive run-off result in Property-Casualty amounted to
€ 427 MN (2015: € 324 MN) and was mainly influenced by the develop-
ment of fire reinsurance (€ 180 MN), engineering reinsurance (€ 99 MN),
personal accident reinsurance (€ 48 MN) and business interruption
reinsurance (€ 36 MN).
19 – Change in other
insurance reserves (net)
€ thou
Change in aggregate policy reserves (net)
Other insurance reserves (net)
Total
2016
3,931
2,794
6,725
2015
(41,473)
2,644
(38,829)
The change in aggregate policy reserves (net) was driven by decreased
business volume due to a recapture of a capital management trans-
action in Life/Health reinsurance.
The other insurance reserves (net) mostly include reserves for
credit and bond reinsurance and motor reinsurance.
a) Income from affiliated enterprises
and participations
thereof from affiliated enterprises:
€ 1,722,849 thou (2015: € 3,794,403 thou)
b) Income from other investments
thereof from affiliated enterprises:
€ 473,296 thou (2015: € 445,516 thou)
ba) Income from real estate, real estate rights
and buildings including buildings on land
not owned by Allianz SE
bb) Income from other investments (see below)
c) Income from reversal of impairments
d) Realized gains
e) Income from profit transfer agreements
Total
bb) Income from other investments
Loans to affiliated enterprises
Debt securities
Funds held by others under reinsurance
business assumed
Interests in funds
Loans to third parties
Receivables from intra-group cash pooling
Bank deposits
Other
Total
2016
2015
1,726,629
3,820,340
27,532
916,897
105,206
365,486
1,943,136
5,084,886
27,474
917,092
3,020
360,899
3,001,333
8,130,158
2016
2015
416,928
385,837
413,731
368,402
72,124
24,935
6,282
7,450
2,686
655
87,145
24,622
12,708
5,183
4,643
658
916,897
917,092
Annual Report 2016
Allianz SE
65
C
Financial Statements of Allianz SE
22 – Investment expenses
23 – Other non-technical result
€ thou
a) Expenses for the management of investments,
interest and other investment-related expenses
aa) Interest expenses (see below)
(1,021,215)
(1,045,224)
2016
2015
€ thou
Other income
Gains on derivatives
Currency gains
ab) Other
b) Depreciation and impairments of investments
c) Realized losses
d) Expenses from losses taken over
Total
(84,983)
(182,873)
(198,564)
(307,823)
(76,699)
(594,135)
(183,763)
(221,493)
Other service revenues to group companies
Income from the release of other provisions
Income due to adjustment
of cost allocation contract
(1,795,458)
(2,121,314)
Intercompany income
Service revenues from pensions charged
to group companies
2016
2015
Other
aa) Interest expenses
Subordinated bonds issued by Allianz SE
Liabilities from intra-group loans
Intra-group subordinated liabilities
(intra-group transmission of proceeds
from third-party financing)
Liabilities from intra-group bonds
Liabilities from intra-group cash pooling
Liabilities from commercial paper issues
Other
Total
(323,824)
(270,917)
(299,544)
(298,906)
(267,960)
(111,109)
(29,860)
(8,647)
(8,898)
(269,591)
(126,320)
(40,653)
(5,573)
(4,637)
(1,021,215)
(1,045,224)
The depreciation and impairments of investments include unsche-
duled write-downs of € 51 MN (2015: € 360 MN) on holdings in affiliated
enterprises and € 7 MN (2015: € 1 MN) on real estate.
Total other income
Other expenses
Expenses on derivatives
Currency losses
Other human related expenses
Anticipated losses on derivatives
Other service expenses to group companies
Interest and similar expense
Expenses for financial guarantees
Service expenses from pensions charged
to group companies
Pension expenses
Expenses due to adjustment
of cost allocation contract
Other
Total other expenses
Other non-technical result
2016
2015
1,135,670
1,018,676
179,192
158,528
147,827
39,798
32,912
5,933
1,157,962
730,466
106,487
33,572
406,050
38,005
29,551
5,484
2,718,536
2,507,577
(998,915)
(1,267,327)
(994,231)
(1,306,285)
(285,837)
(189,683)
(179,192)
(163,233)
(42,586)
(32,912)
(28,675)
–
(262,663)
(295,946)
(283,612)
(106,487)
(969,557)
–
(29,551)
(119,959)
(634,166)
(276,786)
(3,177,927)
(5,289,676)
(459,391)
(2,782,099)
Allianz SE has a joint liability for a large part of the pension provisions
of its German subsidiaries (see note 13 for more details). Costs
incurred in this context are recognized as service expenses from
pension plans charged to group companies, as they are reimbursed
by the German subsidiaries according to the cost allocation contract
and result in corresponding service revenues.
Compared to the previous year, the income from the release of
other provisions increased mainly due to the reduction of the
assumed pension trend from 1.7 % to 1.5 %, leading to an income from
the release of pension provisions of € 143 MN.
The change of the cost allocation contract in 2015 also led to an
income of € 148 MN in the fiscal year, which was lower than in the
previous year (2015: € 406 MN). The decrease in the expenses due to
the adjustment of the cost allocation contract resulted from the fact
that in 2015 Allianz SE fully assumed the obligations resulting from
agents pension fund (“VVW”) (2015: € 634 MN).
The significant decline in interest expenses of € 806 MN was pre-
dominantly caused by a lower addition of the pension provisions of
€ 654 MN, due to a higher discount rate, and by lower interest expen ses
on long-term provisions to the amount of € 166 MN. As a result of a
legal change, the interest rate used for calculating the pension obli-
gations has to be determined as a 10-year-average instead of a 7-year-
average from 2016 onwards.
The significant decrease in pension expenses is basically due to
the fact that after Allianz SE had taken over the obligations resulting
from VVW in 2015, part of the tied agents accepted the offer to waive
their pension annuity in exchange for a lump sum payment at retire-
ment age.
66
Annual Report 2016
Allianz SE
C
Financial Statements of Allianz SE
Furthermore, the items other income and other expenses include
the following offset income and expenses:
€ thou
2016
Pensions and
similar
obligations
Other
obligations
Actual return of the offset assets
(14,367)
(325)
Imputed interest cost for the settlement amount
of the offset liabilities
Effect resulting from the change in the discount
rate for the settlement amount
Net amount of the offset income and expenses
257,785
(106,582)
136,836
403
25
103
FEES TO THE AUDITOR
Details of the fees to the auditor pursuant to § 285 No. 17 HGB for ser-
vices to Allianz SE can be found in the notes to the consolidated
financial statements of Allianz Group.
24 – Income taxes
In 2016, the tax income, which mostly relates to the net operating
income, increased to € 266 MN (2015: € 358 MN).
As the controlling company (“Organträger”) of the tax group,
Allianz SE files a consolidated tax return with most of its German
affiliated enterprises. As long as the corporate income tax loss carried
forward is not fully utilized, the tax compensation payments as of
€ 523 MN (2015: € 664 MN) received from members of the tax group
result presumably in a tax income.
The main differences between accounting and tax-based valua-
tion arise from the balance sheet items reserves for loss and loss
adjustment expenses, pension accruals and liabilities resulting in
deferred tax assets.
In addition, the existing corporate tax loss increases the surplus
of deferred tax assets.
The valuation of the domestic deferred taxes is based on the following
tax rates:
− 31.0 % differences in balance sheet items,
− 15.8 % corporate tax losses,
− 15.2 % trade tax losses.
25 – Net earnings
€ thou
Net income
Unappropriated earnings carried forward
Net earnings
2016
2015
2,947,614
3,553,633
908,252
674,993
3,855,866
4,228,626
Annual Report 2016
Allianz SE
67
C
Financial Statements of Allianz SE
Other InfOrmatIOn
Contingent liabilities, other financial
commitments and legal proceedings
CONTINGENT LIABILITIES
GUARANTEES RELATING TO ALLIANZ GROUP COMPANIES
The following guarantees are provided by Allianz SE to Allianz Group
companies as well as to third parties with regard to the liabilities of
certain Allianz Group companies:
− bonds issued by Allianz Finance II B.V. and Allianz Finance III B.V.
for € 11.8 BN, of which € 4.7 BN were on a subordinated basis,
− commercial papers issued by Allianz Finance Corporation. As of
31 December 2016, USD 0.1 BN in commercial papers were issued
as part of the program,
− letters of credit issued to various Allianz Group companies
amounting to € 0.6 BN.
The guarantees are related to the occurrence of possible future events
that could lead to an obligation. As of today, and to the best of our
knowledge, we assess the probability of a loss resulting from out-
standing guarantees to be extremely remote.
Guarantee declarations totaling € 1.2 BN have also been made for
life policies signed by Allianz Companía de Seguros y Reaseguros S.A.
Allianz SE provides a € 1.0 BN guarantee for the obligations of
Allianz Vie S.A. under a unit-linked pension insurance contract.
Contingent liabilities exist because of indirect pension promises
organized via pension funds ( Allianz Versorgungs kasse VVaG) and
support funds ( Allianz Pensionsverein e.V.). Allianz SE has a joint
liability of € 408 MN for a part of the German pension promises and
plan assets for phased-in early retirement obligations of its German
subsidiaries.
In the context of the transfer of a promissory note of AFF Finan-
cing Limited, Allianz SE provided a guarantee to Allianz Lebensversi-
cherungs-AG of up to € 80 MN.
There are financial commitments in connection with the pro-
mise of compensation to holders of rights under stock option pro-
grams of Allianz France S.A.
In the context of the sale of investments, guarantees were given
in individual cases covering counterparty exposures or the various
bases used to determine purchase prices.
Allianz SE has also provided several subsidiaries and associates
with either a standard indemnity guarantee or such guarantees as
required by the supervisory authorities, which cannot be quantified.
These include, in particular, a deed of general release as against the
Federal Association of German Banks (“Bundesverband deutscher
Banken e.V.”) for Oldenburgische Landesbank AG and Münster-
ländische Bank Thie & Co. KG, in accordance with § 5 (10) of the Stat-
ute of Deposit Security Arrangement Fund. With respect to Münster-
ländische Bank Thie & Co. KG, the declaration has been withdrawn in
January 2016.
In addition, Allianz SE has issued guarantees to various Allianz
Group companies totaling € 475 MN.
OTHER GUARANTEES TO THIRD PARTIES
A contingent indemnity agreement has been entered into with
respect to securities issued by HT1 Funding GmbH in case HT1
Funding GmbH cannot serve the agreed coupon of the bond in part
or in total. The expected obligations for Allianz SE for the foreseeable
future have been recognized in provisions. However, it is not possible
for Allianz SE to predict the ultimate payment obligations at this
point in time.
As of 31 December 2016, other guarantee commitments given by
Allianz SE amounted to € 16 MN. As of today and to the best of our
knowledge, we assess the probability of a loss resulting from other
guarantees to be extremely remote.
LEGAL OBLIGATIONS
Legal obligations to assume any losses arise on account of manage-
ment control agreements and/or profit transfer agreements with the
following companies:
− Allianz Argos 14 GmbH,
− Allianz Asset Management AG,
− Allianz Capital Partners GmbH,
− Allianz Deutschland AG,
− Allianz Finanzbeteiligungs GmbH,
− Allianz Global Corporate & Specialty SE,
− Allianz Investment Management SE,
− Allianz Managed Operations & Services SE,
− Allianz Real Estate GmbH,
− AZ-Arges Vermögensverwaltungsgesellschaft mbH,
− IDS GmbH-Analysis and Reporting Services.
OTHER FINANCIAL COMMITMENTS
Advertising agreements led to financial obligations of € 64 MN.
Security deposits for rental contracts amounted to € 0.1 MN in
financial commitments.
LITIGATION
Allianz SE is involved in legal, regulatory, and arbitration procee-
dings. Such proceedings arise in the ordinary course of business,
including, amongst others, Allianz SE’S activities as a reinsurance
company, employer, investor and taxpayer. It is not feasible to predict
or determine the ultimate outcome of the pending or threatened pro-
ceedings. Management does not believe that the outcome of these
proceedings, including the one discussed below, will have a material
adverse effect on the financial position and the results of Allianz SE,
after consideration of any applicable provisions.
On 24 May 2002, pursuant to a statutory squeeze-out procedure,
the general meeting of Dresdner Bank AG resolved to transfer shares
from its minority shareholders to Allianz as the principal share-
holder, in return for payment of a cash settlement amounting to
€ 51.50 per share. Allianz established the amount of the cash settle-
ment on the basis of an expert opinion and its adequacy was con-
firmed by a court-appointed auditor. Some of the former minority
shareholders applied for a court review of the appropriate amount of
the cash settlement in a mediation procedure (“Spruchverfahren”).
In September 2013 the district court (“Landgericht”) of Frankfurt dis-
missed the minority shareholders’ claims in their entirety. This deci-
sion has been appealed to the higher regional court (“Oberlandes-
68
Annual Report 2016
Allianz SE
C
Financial Statements of Allianz SE
gericht”) of Frankfurt. In the event that a final decision were to
determine a higher amount as an appropriate cash settlement, this
would affect all of the approximately 16 MN shares that were trans-
ferred to Allianz.
Board Members
BENEFITS TO RETIRED MEMBERS
OF THE BOARD OF MANAGEMENT
In 2016, remuneration and other benefits of € 7 MN (2015: € 7 MN5) were
paid to retired members of the Board of Management and surviving
dependents.
The pension obligations for former members of the Board of
Management and their surviving dependents are as follows:
All supervisory board members, current or having resigned during
the year, and all board members, current or having resigned during
page 7 and 8. Their memberships in
the year, are denoted on
supervisory boards or similar committees of other enterprises are
also mentioned on these pages.
€ thou
as of 31 December
Historical costs of the offset assets
Fair value of the offset assets
Settlement amount of the offset liabilities
Pension provisions
2016
94,006
94,006
96,826
2,820
2015
87,493
87,493
97,975
10,482
Board of Management remuneration1
As of 31 December 2016, the Board of Management was comprised of
nine members. The following expenses reflect the full Board of Man-
agement active in the respective year.
The remuneration of the Board of Management includes fixed
and variable components.
The variable remuneration consists of the annual bonus (short-
term), the mid-term bonus (MTB) and the equity-related remunera-
tion (long-term). In 2016, the equity-related remuneration was com-
prised of 66,6942 (2015: 79,6993) Restricted Stock Units (RSU).
Board of managEmEnt rEmunEration
€ thou
Base salary
Annual bonus
Perquisites
Base salary, annual bonus and perquisites total
Fair value of RSu at grant date
Equity-related remuneration
Total
2016
(7,125)
(8,911)
(302)
(16,338)
(8,911)
(8,911)
2015
(8,004)
(9,725)
(341)
(18,070)
(9,725)
(9,725)
(25,249)
(27,795)
The asset value of the pension plan reinsurance contracts is taken as
a basis for the fair value of the offset assets.
Supervisory Board remuneration6
Fixed remuneration
Committee-related
remuneration
Attendance fees
Total
2016
2015
€ thou
(1,408)
(558)
(59)
%
€ thou
69.5
(1,400)
27.5
3.0
(560)
(61)
(2,025)
100.0
(2,021)
%
69.3
27.7
3.0
100.0
Average number of employees
Excluding members of the Board of Management, trainees, interns,
employees in the passive phase of early retirement and employees on
maternity leave or voluntary military/federal voluntary service.
Total remuneration of the Board of Management of Allianz SE for 2016
(excluding the relevant MTB 2016 – 2018 tranche) amounted to
€ 25,624 THoU4 (2015, including the MTB 2013 – 2015 payout:
€ 56,970 THoU).
Full-time staff
Part-time staff
Total
EQUITY-RELATED REMUNERATION
The remuneration system as of 1 January 2010 only awards RSU. For
2016 the fair value of the RSU at the date of grant was € 8,911 THoU
(2015: € 9,725 THoU).
2016
1,389
226
1,615
2015
1,359
224
1,583
1
2
3
4
For detailed information regarding the Board of Management remuneration, please refer to the Remu-
neration Report starting on page 34.
The relevant share price to determine the final number of rSU granted is only available after the sign-off
by the external auditors, thus numbers are based on a best estimate.
The disclosure in the Annual Report 2015 was based on a best estimate of the rSU grants. The figure shown
here for 2015 now includes the actual fair value as of the grant date (4 March 2016). The value therefore
differs from the value disclosed last year.
Including the payment of the mtB tranch for Jay Ralph of € 375 thOU.
5
6
The 2015 amount includes bonus payments made to Clement Booth in 2015, which were already shown
as variable compensation for 2014. The amount shown for 2016 excludes compensation that paid for
active Board membership and disclosed as compensation of the respective performance year.
For detailed information regarding the Supervisory Board remuneration, please refer to the chapter Re-
muneration of the Supervisory Board starting on page 43.
Annual Report 2016
Allianz SE
69
C
Financial Statements of Allianz SE
Staff expenses
Including members of the Board of Management, trainees, interns,
employees in the passive phase of early retirement, and employees
on maternity leave or voluntary military/federal voluntary service.
€ thou
Wages and salaries
Statutory welfare contributions and expenses
for optional support payments
Expenses for pensions and other post-retirement
benefits
Total expenses
2016
2015
(318,337)
(326,549)
(22,305)
(20,816)
(23,313)
(21,889)
(363,955)
(369,254)
Events after the balance sheet date
CHANGES IN SUBORDINATED BONDS
In January 2017, our subsidiary Allianz Finance II B.V. called for
redemption a subordinated bond with a coupon of 4.375 % p.a. in the
amount of € 1.4 BN. The bond has been redeemed on 17 February 2017
in accordance with the terms and conditions of the bond.
Furthermore, in January 2017, Allianz SE issued a subordinated
bond in the amount of € 1.0 BN with a scheduled maturity in July 2047,
but with ordinary call rights of Allianz beginning in July 2027. The
coupon of 3.099 % p.a. is fixed until July 2027.
Also in January 2017, Allianz SE issued a subordinated bond in
the amount of USD 0.6 BN with a scheduled maturity in January 2049,
but with ordinary call rights of Allianz beginning in January 2029. The
coupon of 5.1 % p.a. is fixed until January 2029.
SHARE BUY-BACK PROGRAM AND CAPITAL MANAGEMENT
On 16 February 2017, Allianz SE has decided to launch a share buy-
back program with a volume of up to € 3 BN and to simplify capital
management to make it more flexible. For further details, please refer
to the section “Expected dividend development” of the chapter Out-
look 2017 within the Group Management Report.
Mandates of the Members of the Super-
visory Board and Board of Management
The disclosures required in accordance with § 285 No. 10 HGB for the
Supervisory Board and Board of Management can be found on
page 7 and 8.
Information pursuant to § 160 (1) No. 8 AktG
The following major shareholdings were reported pursuant to § 20 (1)
or (4) AktG or pursuant to § 21 WpHG:
By way of letter dated 27 December 2016, BlackRock Inc., Wil-
mington, Delaware, United Stated, notified in the course of a volun-
tary group notification with triggered threshold on subsidiary level
its voting rights pursuant to § 21 (1) WpHG as of 21 December 2016
amounting to 5.88 % (representing 26,880,708 shares), its holdings in
instruments pursuant to § 25 (1) No. 1 WpHG as of 21 December 2016,
amounting to 0.23 % (representing 1,071,257 voting rights absolute),
and its holdings in instruments pursuant to § 25 (1) No. 2 WpHG as of
21 December 2016, amounting to 0.03 % (representing 158,489 voting
rights absolute). The total position notified on 27 December 2016
amounted to 6.15 %.
Declaration of Conformity with
the German Corporate Governance Code
On 15 December 2016, the Board of Management and the Supervisory
Board of Allianz SE issued the Declaration of Conformity with the Ger-
man Corporate Governance Code required by § 161 AktG and made it
www.allianz.
permanently available on the company’s website at
com/corporate-governance.
70
Annual Report 2016
Allianz SE
List of ParticiPations of aLLianz sE, Munich
as of 31 DEcEMbEr 2016 accorDing to § 285 no. 11 anD
11b hgb in conjunction with § 286 (3) no. 1 hgb
C
Financial Statements of Allianz SE
German entities
Affiliates
ACP Vermögensverwaltung GmbH & Co. KG Nr. 4a,
Munich
ACP Vermögensverwaltung GmbH & Co. KG Nr. 4c,
Munich
ACP Vermögensverwaltung GmbH & Co. KG Nr. 4d,
Munich
ADEUS Aktienregister-Service-GmbH, Munich
AGCS Vermögensverwaltungsgesellschaft mbH & Co.
KG, Munich
Alida Grundstücksgesellschaft mbH & Co. KG, Hamburg
Allianz Asset Management AG, Munich
Allianz AZL Vermögensverwaltung GmbH & Co. KG,
Munich
Allianz Beratungs- und Vertriebs-AG, Munich
Allianz Capital Partners Verwaltungs GmbH, Munich
Allianz Deutschland AG, Munich
Allianz Finanzbeteiligungs GmbH, Munich
Allianz Global Corporate & Specialty SE, Munich
Allianz Global Investors GmbH, Frankfurt am Main
Allianz Handwerker Services GmbH, Aschheim
Allianz Investment Management SE, Munich
Allianz Leben Direkt Infrastruktur GmbH, Munich
Allianz Leben Infrastrukturfonds GmbH, Munich
Allianz Leben Private Equity Fonds 1998 GmbH, Munich
Allianz Leben Private Equity Fonds 2001 GmbH, Munich
Allianz Leben Private Equity Fonds 2008 GmbH, Munich
Allianz Lebensversicherungs-Aktiengesellschaft,
Stuttgart
Allianz Managed Operations & Services SE, Munich
Allianz of Asia-Pacific and Africa GmbH, Munich
Allianz Pension Direkt Infrastruktur GmbH, Munich
Allianz Pensionsfonds Aktiengesellschaft, Stuttgart
Allianz Pensionskasse Aktiengesellschaft, Stuttgart
Allianz Private Equity GmbH, Munich
Allianz Private Krankenversicherungs-Aktiengesellschaft,
Munich
Allianz Renewable Energy Subholding GmbH & Co. KG,
Sehestedt
Allianz Taunusanlage GbR, Stuttgart
Allianz Versicherungs-Aktiengesellschaft, Munich
AllSecur Deutschland AG, Munich
APKV Direkt Infrastruktur GmbH, Munich
APKV Infrastrukturfonds GmbH, Munich
APKV Private Equity Fonds GmbH, Munich
ARE Brep Acht Vermögensbeteiligungsgesellschaft mbH
& Co. KG, Munich
AWP Service Deutschland GmbH, Aschheim
AZ-Arges Vermögensverwaltungsgesellschaft mbH,
Munich
AZ-Argos 44 Vermögensverwaltungsgesellschaft mbH
& Co. KG, Munich
AZ-Argos 50 Vermögensverwaltungsgesellschaft mbH
& Co. KG, Munich
AZ-Argos 51 Vermögensverwaltungsgesellschaft mbH
& Co. KG, Munich
AZ-Argos 57 Vermögensverwaltungsgesellschaft mbH
& Co. KG, Munich
AZ-Argos 64 Vermögensverwaltungsgesellschaft mbH
& Co. KG, Munich
AZ-Argos 70 Vermögensverwaltungsgesellschaft mbH
& Co. KG, Munich
AZ-GARI Vermögensverwaltungsgesellschaft mbH
& Co. KG, Munich
AZL AI Nr. 1 GmbH, Munich
AZ-SGD Direkt Infrastruktur GmbH, Munich
AZ-SGD Infrastrukturfonds GmbH, Munich
AZ-SGD Private Equity Fonds 2 GmbH, Munich
AZ-SGD Private Equity Fonds GmbH, Munich
BrahmsQ Objekt GmbH & Co. KG, Stuttgart
Deutsche Lebensversicherungs-Aktiengesellschaft,
Berlin
Euler Hermes Aktiengesellschaft, Hamburg
manroland AG, Offenbach am Main
manroland Vertrieb und Service GmbH, Mühlheim
am Main
Münchener und Magdeburger Agrarversicherung
Aktiengesellschaft, Munich
Annual Report 2016
Allianz se
Owned1
%
Equity
€ thou
Net
Earnings
€ thou
5,715
(60)
31,769
17,927
387,731
–
100.0
100.0
100.0
79.6
5,007
8,208
100.0
94.8 3
100.0 2
6,551
414,041
3,308,258
409,218
100.0
100.0 2
8,605
10,950
100.0
100.0 2
8,174,341
100.0 2
824,570
100.0 3,2 1,144,236
100.0 2
395,847
28,776
100.0
100.0 2
5,882
100.0 2
182,185
100.0 2
86,456
100.0 2
192,364
100.0 2
2,007,235
100.0 2
40,321
100.0 2
100.0 3,2
100.0
100.0 2
100.0
100.0
100.0 2
1,598,344
211,296
81,663
5,656
54,085
263,321
31,323
100.0 2
100.0 3
99.5 3
100.0 2
100.0 2
100.0 2
100.0 2
100.0 2
100.0
100.0
19,493
181,320
1,487,699
44,831
50,477
12,610
306,026
83,886
7,101
(5,610)
668
576
10,612
–
(62)
(878)
3,425
–
–
–
–
1,763
–
–
–
–
–
–
–
–
–
–
1,901
18,839
–
(14)
5,792
(28)
–
–
–
–
291
1,296
–
100.0 2
164,583
100.0
54,824
12,948
100.0
175,907
19,293
100.0
192,547
34,870
100.0
100.0
100.0
79,343
18,089
40,048
2,888
7,648
76
100.0
163,613
100.0 2 10,251,128
100.0 2
47,786
100.0 2
14,248
100.0 2
56,038
100.0 2
449,976
94.8 3
88,532
14,534
–
–
–
–
–
2,672
100.0 2
100.0 3
100.0 4,5
100.0 4,5
100.0 2
44,991
91,936
148,289
–
31,397
(179,129)
5,155
7,686
–
17
Oldenburgische Landesbank Aktiengesellschaft,
Oldenburg
PIMCO Deutschland GmbH, Munich
REC Frankfurt Objekt GmbH & Co. KG, Hamburg
Spherion Objekt GmbH & Co. KG, Stuttgart
Volkswagen Autoversicherung AG, Braunschweig
Volkswagen Autoversicherung Holding GmbH,
Braunschweig
Windpark Aller-Leine-Tal GmbH & Co. KG, Sehestedt
Windpark Berge-Kleeste GmbH & Co. KG, Sehestedt
Windpark Büttel GmbH & Co. KG, Sehestedt
Windpark Calau GmbH & Co. KG, Sehestedt
Windpark Cottbuser See GmbH & Co. KG, Sehestedt
Windpark Dahme GmbH & Co. KG, Sehestedt
Windpark Eckolstädt GmbH & Co. KG, Sehestedt
Windpark Freyenstein-Halenbeck GmbH & Co. KG,
Sehestedt
Windpark Kesfeld-Heckhuscheid GmbH & Co. KG,
Sehestedt
Windpark Kirf GmbH & Co. KG, Sehestedt
Windpark Kittlitz GmbH & Co. KG, Sehestedt
Windpark Pröttlin GmbH & Co. KG, Sehestedt
Windpark Quitzow GmbH & Co. KG, Sehestedt
Windpark Redekin-Genthin GmbH & Co. KG, Sehestedt
Windpark Schönwalde GmbH & Co. KG, Sehestedt
Windpark Waltersdorf GmbH & Co. KG Renditefonds,
Sehestedt
Windpark Werder Zinndorf GmbH & Co. KG, Sehestedt
Owned1
%
90.2
100.0 2
80.0
100.0 3
100.0 2
49.0
100.0 3
100.0 3
100.0 3
100.0 3
100.0 3
100.0 3
100.0 3
100.0 3
100.0 3
100.0 3
100.0 3
100.0 3
100.0 3
100.0 3
100.0 3
100.0 3
100.0 3
Equity
€ thou
649,349
35,030
309,334
79,354
108,517
113,402
24,021
12,378
27,372
50,719
16,652
39,055
42,599
Net
Earnings
€ thou
35,219
–
8,997
2,647
–
(2,888)
1,226
2,200
3,170
3,390
2,223
6,910
2,646
24,133
2,996
25,822
5,902
9,543
18,066
17,953
29,126
20,105
11,464
30,250
2,504
718
994
2,510
2,079
2,403
1,621
1,024
3,191
Joint ventures
Dealis Fund Operations GmbH, Frankfurt am Main
50.0
18,587
943
Associates
AV Packaging GmbH, Munich
T&R Investment GmbH & Co. KG, Bonn
T&R Real Estate GmbH, Bonn
Other participations below 20 % of voting rights
APEP Dachfonds GmbH & Co. KG, Munich
Asia Property Fund II GmbH & Co. KG, Munich
EXTREMUS Versicherungs-Aktiengesellschaft, Cologne
FC Bayern München AG, Munich
Mittelständische Beteiligungsgesellschaft Niedersachsen
(MBG) mbH, Hanover
MLP AG, Wiesloch
Objekt Burchardplatz GmbH & Co. KG, Stuttgart
Protektor Lebensversicherungs-AG, Berlin
Sana Kliniken AG, Ismaning
ForeiGn entities
Affiliates
114 Venture LP, Wilmington, DE
490 Lower Unit LP, Wilmington, DE
Aero-Fonte S.r.l., Catania
AGA Alarmcentrale NL B.V., Amsterdam
AGA Assistance (India) Private Limited, Gurgaon
AGA Assistance Australia Pty Ltd., Toowong
AGA Assistance Beijing Services Co. Ltd., Beijing
AGA Service Company Corp., Richmond, VA
AGCS Marine Insurance Company, Chicago, IL
AGCS Resseguros Brasil S.A., São Paulo
AGF Holdings (UK) Limited, Guildford
AGF Inversiones S.A., Buenos Aires
Allianz (UK) Limited, Guildford
Allianz Africa S.A., Paris la Défense
Allianz Alapkezelõ Zrt., Budapest
Allianz Argentina Compañía de Seguros Generales S.A.,
Buenos Aires
Allianz Argentina RE S.A., Buenos Aires
Allianz Asset Management of America L.P., Dover, DE
Allianz Asset Management of America LLC, Dover, DE
Allianz Asset Management U.S. Holding II LLC, Dover, DE
Allianz Australia Insurance Limited, Sydney
Allianz Australia Life Insurance Limited, Sydney
Allianz Australia Limited, Sydney
51.0
25.0 3
25.0 3
12.1 3
11.8 3
16.0 3
8.3 3
5.5 3
8.8 3
5.1 3
10.0 3
14.3 3
99.0 3
100.0
100.0 3
100.0
100.0
100.0
100.0
100.0
100.0 3
100.0 3
100.0
100.0 3
100.0
100.0 3
100.0
100.0 3
100.0 3
100.0
100.0
100.0
100.0 3
100.0 3
100.0 3
17,699
350,120
140,867
445,421
167,080
50,000
411,494
12,235
387,573
93,507
92,900
400,605
166,962
146,524
11,411
13,081
9,362
15,013
17,837
8,850
120,921
44,420
95,781
21,359
481,131
32,530
7,223
3,755
(102)
–
(128,052)
12,183
500
15,122
759
15,569
1,894
1,824
390,644
(33)
4,001
3,143
1,559
965
1,460
12,707
12,031
505
3,335
23,904
4,940
34
4,575
3,336
55,448
19,174
706,470
6,611,376
259,577
1,544,721
48,810
1,569,089
11,182
11,399
1,267,291
1,542,252
59,710
179,040
6,370
176,118
71
C
Financial Statements of Allianz SE
Allianz Ayudhya Assurance Public Company Limited,
Bangkok
Allianz Bank Bulgaria AD, Sofia
Allianz Bank Financial Advisors S.p.A., Milan
Allianz Banque S.A., Puteaux
Allianz Benelux S.A., Brussels
Allianz Bulgaria Holding AD, Sofia
Allianz Burkina Assurances SA, Ouagadougou
Allianz C.P. General Insurance Co. Ltd., Bangkok
Allianz Cameroun Assurances SA, Douala
Allianz Carbon Investments B.V., Amsterdam
Allianz Cash SAS, Paris la Défense
Allianz Chicago Private Reit LP, Wilmington, DE
Allianz China General Insurance Company Ltd.,
Guangzhou
Allianz China Life Insurance Co. Ltd., Shanghai
Allianz Colombia S.A., Bogotá D.C.
Allianz Compañía de Seguros y Reaseguros S.A.,
Barcelona
Allianz Cornhill Information Services Private Ltd.,
Trivandrum
Allianz Côte d'Ivoire Assurances SA, Abidjan
Allianz Côte d'Ivoire Assurances Vie SA, Abidjan
Allianz Digital Corporate Ventures S.à r.l., Luxembourg
Allianz do Brasil Participações Ltda., São Paulo
Allianz Elementar Lebensversicherungs-Aktiengesell-
schaft, Vienna
Allianz Elementar Versicherungs-Aktiengesellschaft,
Vienna
Allianz Engineering Inspection Services Limited,
Guildford
Allianz Equity Investments Ltd., Guildford
Allianz Europe B.V., Amsterdam
Allianz Europe Ltd., Amsterdam
Allianz Finance II B.V., Amsterdam
Allianz Finance II Luxembourg S.à r.l., Luxembourg
Allianz Finance VII Luxembourg S.A., Luxembourg
Allianz Finance VIII Luxembourg S.A., Luxembourg
Allianz Fire and Marine Insurance Japan Ltd., Tokyo
Allianz France Investissement OPCI, Paris la Défense
Allianz France Real Estate Invest SPPICAV, Paris la Défense
Allianz France Richelieu 1 S.A.S., Paris la Défense
Allianz France S.A., Paris la Défense
Allianz France US REIT LP, Wilmington, DE
Allianz Fund Investments Inc., Wilmington, DE
Allianz General Insurance Company (Malaysia)
Berhad p.l.c., Kuala Lumpur
Allianz Global Corporate & Specialty do Brasil
Participações Ltda., Rio de Janeiro
Allianz Global Corporate & Specialty of Africa
(Proprietary) Ltd., Johannesburg
Allianz Global Corporate & Specialty South Africa Ltd.,
Johannesburg
Allianz Global Investors Asia Pacific Ltd., Hong Kong
Allianz Global Investors Distributors LLC, Dover, DE
Allianz Global Investors Japan Co. Ltd., Tokyo
Allianz Global Investors Singapore Ltd., Singapore
Allianz Global Investors Taiwan Ltd., Taipei
Allianz Global Investors U.S. Holdings LLC, Dover, DE
Allianz Global Investors U.S. LLC, Dover, DE
Allianz Global Life dac, Dublin
Allianz Global Risks US Insurance Company Corp.,
Chicago, IL
Allianz Hayat ve Emeklilik A.S., Istanbul
Allianz Hellas Insurance Company S.A., Athens
Allianz Hold Co Real Estate S.à r.l., Luxembourg
Allianz Holding eins GmbH, Vienna
Allianz Holding France SAS, Paris la Défense
Allianz Holdings plc, Guildford
Allianz Hungária Biztosító Zrt., Budapest
Allianz IARD S.A., Paris la Défense
Allianz Individual Insurance Group LLC, Minneapolis, MN
Allianz Infrastructure Czech HoldCo I S.à r.l.,
Luxembourg
Allianz Infrastructure Czech HoldCo II S.à r.l.,
Luxembourg
Allianz Infrastructure Luxembourg Holdco I S.A.,
Luxembourg
Allianz Infrastructure Luxembourg Holdco II S.A.,
Luxembourg
Allianz Infrastructure Luxembourg I S.à r.l., Luxembourg
Allianz Infrastructure Norway Holdco I S.à r.l.,
Luxembourg
Allianz Infrastructure Spain Holdco I S.à r.l., Luxembourg
Allianz Infrastructure Spain Holdco II S.à r.l., Luxembourg
Allianz Insurance Company of Kenya Limited, Nairobi
Allianz Insurance Company-Egypt S.A.E., New Cairo
Owned1
%
Equity
€ thou
Net
Earnings
€ thou
62.6 3
99.9 3
100.0 3
100.0
100.0 3
66.2 3
60.3 3
100.0 3
75.4 3
100.0 3
100.0
100.0
100.0 3
51.0 3
100.0 3
360,709
100,455
250,516
118,459
841,159
53,409
5,306
24,357
14,460
13,049
5,230
197,944
44,618
35,701
100,312
45,123
5,199
20,362
5,289
519
17,240
1,117
457
3,055
(5,120)
(33)
5
(1,260)
1,358
1,805
99.9
956,836
146,485
100.0
74.1 3
71.0 3
100.0 3
100.0 3
32,431
8,778
7,350
5,387
288,096
4,402
2,080
1,991
(53)
(102,014)
100.0
201,045
3,696
100.0
457,342
119,544
100.0
100.0
100.0
100.0 3
100.0 3
100.0 3
100.0 3
100.0 3
100.0 3
100.0
100.0 3
100.0
100.0
100.0
100.0 3
8,134
162,495
45,713,477
9,558,311
15,556
3,673,532
783,534
240,448
24,263
137,520
1,624,428
468,131
6,175,772
125,355
256,312
2,446
3,786
1,297,755
(84,294)
2,846
(27,128)
(8,153)
53
6,909
5,415
31,503
9,146
1,018,076
197
(285)
100.0
374,745
53,150
100.0 3
100.0 3
100.0 3
100.0
100.0
100.0
100.0
100.0
100.0
100.0
100.0 3
100.0 3
89.0
100.0
100.0 3
100.0
100.0
100.0
100.0
100.0
100.0 3
100.0 3
100.0 3
48,887
3,316
7,705
290
7,865
27,604
34,291
6,836
11,970
28,400
114,723
75,807
107,852
1,538,915
18,033
139,765
349,943
2,392,360
7,863,619
1,093,722
1,018,443
2,026,284
203,651
293
857
(1,769)
1,193
(1,412)
9,736
106,867
114,618
(8,560)
24,716
(3,603)
3,653
5,604
356,655
1,892,768
614
39,162
343,892
(5,285)
8,654
44,794
8,615
44,830
100.0 3
1,048,522
13
100.0 3
100.0 3
100.0 3
100.0 3
100.0 3
100.0 3
95.0 3
218,895
1,436,338
(13)
30,286
61,002
54,433
80,139
9,459
23,397
175
(7)
699
311
3,938
Allianz Insurance Lanka Limited, Colombo
Allianz Insurance plc, Guildford
Allianz Invest Kapitalanlagegesellschaft mbH, Vienna
Allianz Investment Management LLC, Minneapolis, MN
Allianz Investmentbank Aktiengesellschaft, Vienna
Allianz Irish Life Holdings p.l.c., Dublin
Allianz Leasing Bulgaria AD, Sofia
Allianz Life & Annuity Company, Minneapolis, MN
Allianz Life (Bermuda) Ltd., Hamilton
Allianz Life Assurance Company-Egypt S.A.E., New Cairo
Allianz Life Financial Services LLC, Minneapolis, MN
Allianz Life Insurance Company Ltd., Moscow
Allianz Life Insurance Company of Missouri, Clayton, MO
Allianz Life Insurance Company of New York, New York, NY
Allianz Life Insurance Company of North America,
Minneapolis, MN
Allianz Life Insurance Japan Ltd., Tokyo
Allianz Life Insurance Malaysia Berhad p.l.c.,
Kuala Lumpur
Allianz Life Luxembourg S.A., Luxembourg
Allianz Malaysia Berhad p.l.c., Kuala Lumpur
Allianz Marine (UK) Ltd., Ipswich
Allianz Maroc S.A., Casablanca
Allianz Mena Holding Bermuda Ltd., Beirut
Allianz México S.A. Compañía de Seguros, Mexico City
Allianz Nederland Asset Management B.V., Rotterdam
Allianz Nederland Groep N.V., Rotterdam
Allianz Nederland Levensverzekering N.V., Rotterdam
Allianz New Europe Holding GmbH, Vienna
Allianz New Zealand Limited, Auckland
Allianz of America Inc., Wilmington, DE
Allianz p.l.c., Dublin
Allianz Pensionskasse Aktiengesellschaft, Vienna
Allianz penzijní spolecnost a.s., Prague
Allianz PNB Life Insurance Inc., Makati City
Allianz pojistovna a.s., Prague
Allianz Polska Services Sp. z o.o., Warsaw
Allianz Popular Asset Management SGIIC S.A., Madrid
Allianz Popular Pensiones EGFP S.A., Madrid
Allianz Popular S.L., Madrid
Allianz Popular Vida Compañía de Seguros y
Reaseguros S.A., Madrid
Allianz Presse US REIT LP, Wilmington, DE
Allianz Private Equity UK Holdings Limited, London
Allianz Properties Limited, Guildford
Allianz Re Dublin dac, Dublin
Allianz Renewable Energy Partners I LP, London
Allianz Renewable Energy Partners II Limited, London
Allianz Renewable Energy Partners III LP, London
Allianz Renewable Energy Partners IV Limited, London
Allianz Renewable Energy Partners of America LLC,
Wilmington, DE
Allianz Renewable Energy Partners V plc., London
Allianz Renewable Energy Partners VI Limited, London
Allianz Renewable Energy Partners VIII Limited, London
Allianz Risk Transfer (Bermuda) Ltd., Hamilton
Allianz Risk Transfer AG, Schaan
Allianz Risk Transfer Inc., New York, NY
Allianz Risk Transfer N.V., Amsterdam
Allianz S.p.A., Trieste
Allianz Saúde S.A., São Paulo
Allianz Seguros de Vida S.A., Bogotá D.C.
Allianz Seguros S.A., São Paulo
Allianz Seguros S.A., Bogotá D.C.
Allianz Sénégal Assurances SA, Dakar
Allianz Services (UK) Limited, London
Allianz Sigorta A.S., Istanbul
Allianz SNA s.a.l., Beirut
Allianz Société Financière S.à r.l., Luxembourg
Allianz South America Holding B.V., Amsterdam
Allianz Specialised Investments Limited, London
Allianz Subalpina Holding S.p.A., Turin
Allianz Suisse Lebensversicherungs-Gesellschaft AG,
Wallisellen
Allianz Suisse Versicherungs-Gesellschaft AG, Wallisellen
Allianz Taiwan Life Insurance Co. Ltd., Taipei
Allianz Tiriac Asigurari SA, Bucharest
Allianz Tiriac Pensii Private Societate de administrare
a fondurilor de pensii private S.A., Bucharest
Allianz Underwriters Insurance Company Corp.,
Burbank, CA
Allianz US Investment LP, Wilmington, DE
Allianz US Private REIT LP, Wilmington, DE
Owned1
%
100.0 3
100.0
100.0 3
100.0 3
100.0
66.5 3
51.0 3
100.0 3
100.0 3
100.0 3
100.0 3
100.0 3
100.0 3
100.0 3
100.0 3
100.0
100.0 3
100.0 3
75.0 3
100.0 3
98.9 3
99.9 3
100.0
100.0
100.0
100.0
100.0
100.0 3
100.0
100.0 3
100.0
100.0 3
51.0
100.0 3
100.0 3
100.0
100.0
60.0
100.0
100.0
100.0
100.0
100.0 3
100.0
100.0
98.8
98.8
100.0
100.0
100.0
100.0
100.0 3
100.0 3
100.0 3
100.0 3
100.0 3
100.0 3
100.0
100.0 3
100.0
83.2 3
100.0 3
96.2
100.0 3
100.0 3
100.0 3
100.0
98.1 3
100.0
100.0
99.7 3
52.2 3
100.0 3
100.0 3
100.0
100.0
Equity
€ thou
6,309
1,348,928
5,549
5,098
34,682
61,516
5,471
7,603
7,077
52,471
31,244
31,276
252,738
122,713
5,765,942
9,061
114,497
67,498
53,514
12,175
74,850
22,283
90,513
30,351
313,832
260,395
842,169
34,100
9,004,192
352,480
11,223
28,881
15,118
166,521
13,272
8,147
21,933
1,018,469
120,628
33,488
18,806
201,435
537,326
207,439
83,491
167,485
774,203
483,816
749,521
370,411
141,118
53,201
639,485
52,197
31,871
3,399,299
62,963
60,374
285,044
49,341
5,137
6,709
442,536
47,561
1,401,280
279,158
7,069
355,050
962,260
618,261
168,776
168,117
Net
Earnings
€ thou
908
87,133
1,661
43,623
5,169
10,025
891
151
1,254
15,922
(38)
42,753
(11,906)
(950)
451,927
(1,542)
15,976
5,727
4,038
72
4,162
(216)
27,492
1,422
32,388
15,443
170,505
1,708
572,600
8,866
357
1,523
1,934
29,395
1,977
23,582
22,980
210,274
59,415
(270)
268
32
204,597
8,886
(11,239)
5,790
9,612
11,130
17,707
(2,016)
(47)
5,005
89,491
(67)
207
661,127
(57,014)
8,877
(104,984)
3,392
443
102
112,477
5,405
21,944
(231,763)
(4)
325,048
69,591
263,051
(35,974)
18,399
13,526
5,381
56,482
1,098,891
1,130,388
1,167
(5,802)
(6,598)
72
Annual Report 2016
Allianz se
Owned1
%
100.0
100.0
100.0
80.0
83.2 3
51.0
100.0
99.6
100.0 3
100.0 3
100.0
100.0 3
100.0 3
100.0 3
100.0
100.0 3
100.0
100.0 3
100.0
100.0
100.0
100.0 3
100.0 3
100.0 3
100.0
100.0 3
95.0
100.0
100.0
100.0
100.0 3
100.0 3
100.0 3
100.0 3
100.0 3
100.0 3
100.0
55.0
100.0 3
100.0
100.0 3
100.0
100.0 3
100.0 3
100.0
100.0
100.0
100.0
100.0
93.2
100.0
100.0 3
100.0
100.0 3
100.0 3
64.8
100.0
100.0 3
50.0 3
50.0 3
100.0 3
50.1
100.0 3
100.0 3
100.0 3
100.0 3
55.0 3
100.0 3
100.0 3
100.0 3
63.9 3
100.0 3
100.0 3
100.0 3
Equity
€ thou
2,639,215
21,949
369,015
108,028
110,017
Net
Earnings
€ thou
333,545
5,415
3,772
48,551
13,638
21,358
45,863
412,324
144,294
30,694
18,786
40,469
80,952
35,522
10,339
15,801
16,838
13,212
52,315
207,673
13,523
55,188
51,467
30,490
5,780
71,979
26,376
410,088
308,014
15,088
270,036
3,218,713
106,530
24,899
2,643,749
303,529
81,922
20,984
506,154
12,942
9,482
5,275
88,771
14,759
486
687
307
–
(28)
3,462
8
(1,085)
1,487
(227)
(219)
3,955
793
937
1,995
5,126
1,931
42,405
37,842
23,596
13,332
6,208
21,507
(3,831)
132
75
(19,908)
(2,014)
5,967
–
2,423
84,478
3,078
140,497
46,048
5,005
35,489
11,526
156,267
69,523
21,460
196,540
60,813
8,213
36,511
50,563
29,991
184,509
14,453
33,907
75,578
474,781
232,117
92,425
9,559
10,727
558,798
5,701
9,627
5,504
6,639
157,780
1,313,188
14,798
100,632
8,898
3,221
(274)
(24)
514
6,602
(25,295)
746
2,482
(13,554)
(2,746)
496
3,158
4,706
10,084
(885)
22,418
5,075
23,801
72,868
11,062
(874)
597
7,936
801
2,860
2,036
4,319
7,213
204,026
1,341
(28)
164,357
13,319
Euler Hermes North America Insurance Company Inc.,
Owings Mills, MD
Euler Hermes Patrimonia SA, Brussels
Euler Hermes Ré SA, Luxembourg
Euler Hermes Real Estate SPPICAV, Paris la Défense
Euler Hermes Recouvrement France S.A.S., Paris la
Défense
Euler Hermes Reinsurance AG, Wallisellen
Euler Hermes S.A., Brussels
Euler Hermes Seguros de Crédito S.A., São Paulo
Euler Hermes Service AB, Stockholm
Euler Hermes Services Italia S.r.l, Rome
Euler Hermes Services Sp. z o.o., Warsaw
Euler Hermes Sigorta A.S., Istanbul
Euler Hermes South Express S.A., Brussels
Euler Hermes World Agency SASU, Paris la Défense
Eurl 20/22 Le Peletier, Paris la Défense
Eurosol Invest S.r.l., Udine
Fénix Directo Compañía de Seguros y Reaseguros S.A.,
Madrid
Fireman's Fund Indemnity Corporation, Liberty Corner, NJ
Fireman's Fund Insurance Company Corp., Los Angeles, CA
Fireman's Fund Insurance Company of Hawaii Inc.,
Honolulu, HI
Fireman's Fund Insurance Company of Ohio Corp.,
Cincinnati, OH
Fragonard Assurance S.A., Paris
Fu An Management Consulting Co. Ltd., Beijing
GamePlan Financial Marketing LLC, Woodstock, GA
Generation Vie S.A., Courbevoie
Genialloyd S.p.A., Milan
Havelaar & van Stolk B.V., Rotterdam
Home & Legacy Insurance Services Limited, London
Immovalor Gestion S.A., Paris la Défense
Insurance CJSC "Medexpress", Saint Petersburg
Interstate Fire & Casualty Company, Chicago, IL
Investitori SGR S.p.A., Milan
Järvsö Sörby Vindkraft AB, Danderyd
Jefferson Insurance Company Corp., New York, NY
JSC Insurance Company Allianz, Moscow
Kiinteistö OY Eteläesplanadi 2, Helsinki
Lloyd Adriatico Holding S.p.A., Trieste
Mondial Assistance Australia Holding Pty Ltd., Toowong
Mondial Assistance United Kingdom Ltd., Croydon Surrey
Mondial Serviços Ltda., São Bernardo do Campo
National Surety Corporation, Chicago, IL
NEXtCARE Holding WLL, Manama
NFJ Investment Group LLC, Dover, DE
OJSC "My Clinic", Moscow
OPCI Allianz France Angel, Paris la Défense
Orione PV S.r.l., Milan
Orsa Maggiore PV S.r.l., Milan
Pacific Investment Management Company LLC, Dover, DE
Personalized Brokerage Service LLC, Topeka, KS
Pet Plan Ltd., Guildford
PFP Holdings Inc., Dover, DE
PGA Global Services LLC, Dover, DE
PIMCO (Schweiz) GmbH, Zurich
PIMCO Asia Ltd., Hong Kong
PIMCO Asia Pte Ltd., Singapore
PIMCO Australia Management Limited, Sydney
PIMCO Australia Pty Ltd., Sydney
PIMCO Canada Corp., Toronto, ON
PIMCO Europe Ltd., London
PIMCO Global Advisors (Ireland) Ltd., Dublin
PIMCO Global Advisors (Resources) LLC, Dover, DE
PIMCO Global Advisors LLC, Dover, DE
PIMCO Global Holdings LLC, Dover, DE
PIMCO Investments LLC, Dover, DE
PIMCO Japan Ltd., Road Town
POD Allianz Bulgaria AD, Sofia
Protexia France S.A., Paris la Défense
PT Asuransi Allianz Life Indonesia p.l.c., Jakarta
PTE Allianz Polska S.A., Warsaw
Q207 S.C.S., Luxembourg
Questar Capital Corporation, Minneapolis, MN
Real Faubourg Haussmann SAS, Paris la Défense
Real FR Haussmann SAS, Paris la Défense
Redoma S.à r.l., Luxembourg
Rogge Global Partners Ltd., London
SA Carène Assurance, Paris
San Francisco Reinsurance Company, Los Angeles, CA
Allianz Vie S.A., Paris la Défense
Allianz Vorsorgekasse AG, Vienna
Allianz Worldwide Partners S.A.S., Saint-Ouen
Allianz Yasam ve Emeklilik A.S., Istanbul
Allianz Zagreb d.d., Zagreb
Allianz ZB d.o.o. Company for the Management of
Obligatory Pension Funds, Zagreb
Allianz-Slovenská DSS a.s., Bratislava
Allianz-Slovenská poist'ovna a.s., Bratislava
American Automobile Insurance Company Corp.,
Earth City, MO
American Financial Marketing Inc., Minneapolis, MN
AMOS Austria GmbH, Vienna
AMOS European Services SAS, Paris
AMOS IberoLatAm S.L., Barcelona
AMOS International B.V., Amsterdam
AMOS IT Suisse AG, Wallisellen
AMOS Italy S.p.c.A., Milan
AMOS of America Inc., Wilmington, DE
Ann Arbor Annuity Exchange Inc., Ann Arbor, MI
APK US Investment LP, Wilmington, DE
APKV US Private REIT LP, Wilmington, DE
Arab Gulf Health Services LLC, Dubai
Arges Investments I N.V., Amsterdam
Arges Investments II N.V., Amsterdam
Asit Services S.R.L., Bucharest
Assistance Courtage d'Assurance et de Réassurance S.A.,
Courbevoie
Associated Indemnity Corporation, Los Angeles, CA
AWP France SAS, Saint-Ouen
AWP Health & Life S.A., Paris la Défense
AWP P&C S.A., Saint-Ouen
AWP USA Inc., Richmond, VA
AZ Euro Investments II S.à r.l., Luxembourg
AZ Euro Investments S.à r.l., Luxembourg
AZ Jupiter 10 B.V., Amsterdam
AZ Jupiter 4 B.V., Amsterdam
AZ Jupiter 8 B.V., Amsterdam
AZ Jupiter 9 B.V., Amsterdam
AZ Vers US Private REIT LP, Wilmington, DE
AZGA Service Canada Inc., Kitchener, ON
AZL PF Investments Inc., Minneapolis, MN
AZOA Services Corporation, New York, NY
Beleggingsmaatschappij Willemsbruggen B.V.,
Rotterdam
Beykoz Gayrimenkul Yatirim Insaat Turizm Sanayi ve
Ticaret A.S., Ankara
Botanic Building SPRL, Brussels
Brasil de Imóveis e Participações Ltda., São Paulo
Bright Mission Berhad Ltd., Kuala Lumpur
British Reserve Insurance Co. Ltd., Guildford
Calobra Investments Sp. z o.o., Warsaw
Calypso S.A., Paris la Défense
CAP Rechtsschutz-Versicherungsgesellschaft AG,
Wallisellen
Caroline Berlin S.C.S., Luxembourg
Central Shopping Center a.s., Bratislava
CEPE de la Forterre S.à r.l., Versailles
Château Larose Trintaudon S.A., Saint Laurent Médoc
Chicago Insurance Company Corp., Chicago, IL
CIC Allianz Insurance Ltd., Sydney
Companhia de Seguros Allianz Portugal S.A., Lisbon
Corn Investment Ltd., London
CPRN Thailand Ltd., Bangkok
CreditRas Assicurazioni S.p.A., Milan
CreditRas Vita S.p.A., Milan
Darta Saving Life Assurance Ltd., Dublin
Deeside Investments Inc., Wilmington, DE
Delta Technical Services Ltd., London
Diamond Point a.s., Prague
Dresdner Kleinwort Pfandbriefe Investments II Inc.,
Minneapolis, MN
Eolica Erchie S.r.l., Lecce
Euler Hermes Acmar SA, Casablanca
Euler Hermes Collections North America Company,
Owings Mills, MD
Euler Hermes Collections Sp. z o.o., Warsaw
Euler Hermes Crédit France S.A.S., Paris la Défense
Euler Hermes Group SA, Paris la Défense
Euler Hermes Hellas Credit Insurance SA, Athens
Euler Hermes Luxembourg Holding S.à r.l., Luxembourg
Euler Hermes North America Holding Inc.,
Owings Mills, MD
Annual Report 2016
Allianz se
C
Financial Statements of Allianz SE
Owned1
%
Equity
€ thou
Net
Earnings
€ thou
100.0 3
100.0 3
100.0 3
60.0 3
100.0 3
100.0 3
100.0 3
100.0 3
100.0 3
100.0 3
100.0 3
100.0 3
100.0 3
100.0 3
100.0
100.0 3
100.0
100.0 3
100.0 3
100.0 3
100.0 3
100.0
1.0
100.0 3
52.5
100.0 3
100.0
100.0
100.0
100.0 3
100.0 3
100.0 3
100.0 3
100.0
100.0 3
100.0 3
99.9 3
100.0
100.0
100.0
100.0 3
75.0
100.0
100.0 3
100.0
100.0 3
100.0 3
95.7
100.0 3
100.0
100.0
100.0
100.0
100.0
100.0
100.0
100.0
100.0
100.0
100.0
100.0
100.0
100.0
100.0
100.0
65.9 3
100.0
99.8
100.0 3
94.0
100.0 3
100.0 3
100.0 3
100.0 3
100.0
100.0
100.0
151,253
244,124
61,055
170,291
70,614
767,342
693,293
7,876
7,544
9,158
8,452
7,586
39,215
7,351
52,312
9,310
41,342
12,380
1,071,295
15,788
16,680
–
(2,848)
9,429
60,129
188,484
(4,575)
7,449
8,658
2,231
(3,343)
1,184
572
1,906
689
(1,494)
253
219,956
7,517
45
41,294
84,425
6,568
53,656
74,042
243,154
5,856
22,960
6,739
5,669
137,963
21,895
10,810
67,732
73,158
33,736
634,474
7,552
9,911
36,552
115,780
15,612
14,310
13,392
122,855
8,331
17,886
525,942
6,850
113,531
265,181
12,971
8,201
21,874
16,034
5,353
25,938
32,345
240,818
21,773
5,605
424,947
41,489
95,304
36,600
23,390
31,936
378,652
49,534
89,229
13,036
72,147
63,028
29,530
19,722
12,838
582,001
726
26,738
(49)
2,362
3,498
52,215
(634)
2,954
2,807
(148)
8,486
–
(4,920)
7,643
(11,063)
(393)
539,394
5,841
5,928
36
9,027
(2,226)
8,306
(140)
3,440
225
1,378
1,572,237
608
31
7,225
1,470
2,675
688
1,312
(137)
13,749
14,723
155,110
6,957
19
164,597
15,353
197,539
19,241
9,342
7,985
61,110
4,566
8,580
(2,309)
56,466
3,507
(17)
(5,518)
464
(19,924)
73
C
Financial Statements of Allianz SE
SAS 20 pompidou, Paris la Défense
SAS Allianz Etoile, Paris la Défense
SAS Allianz Forum Seine, Paris la Défense
SAS Allianz Logistique, Paris la Défense
SAS Allianz Platine, Paris la Défense
SAS Allianz Rivoli, Paris la Défense
SAS Allianz Serbie, Paris la Défense
SAS Angel Shopping Centre, Paris la Défense
SAS Madeleine Opéra, Paris la Défense
SAS Passage des princes, Paris la Défense
Sättravallen Wind Power AB, Strömstad
SC Tour Michelet, Paris la Défense
SCI 46 Desmoulins, Paris la Défense
SCI Allianz ARC de Seine, Paris la Défense
SCI Allianz Chateaudun, Paris la Défense
SCI Allianz Invest Pierre, Paris la Défense
SCI Allianz Messine, Paris la Défense
SCI AVIP SCPI Selection, Courbevoie
SCI ESQ, Paris la Défense
SCI Via Pierre 1, Paris la Défense
SCI Volnay, Paris la Défense
SDIII Energy GmbH & Co. KG, Pottenbrunn
Silex Gas Norway AS, Oslo
Sirius S.A., Luxembourg
Società Agricola San Felice S.p.A., Milan
Société Foncière Européenne B.V., Amsterdam
Société Nationale Foncière S.A.L., Beirut
Sofiholding S.A., Brussels
South City Office Broodthaers SA, Brussels
StocksPLUS Management Inc., Dover, DE
TFI Allianz Polska S.A., Warsaw
The American Insurance Company Corp., Cincinnati, OH
The Annuity Store Financial & Insurance Services LLC,
Sacramento, CA
Three Pillars Business Solutions Limited, Guildford
Top Immo A GmbH & Co. KG, Vienna
Top Immo Besitzgesellschaft B GmbH & Co. KG, Vienna
Top Versicherungsservice GmbH, Vienna
Towarzystwo Ubezpieczen Euler Hermes S.A., Warsaw
Trafalgar Insurance Public Limited Company, Guildford
TU Allianz Polska S.A., Warsaw
TU Allianz Zycie Polska S.A., Warsaw
VertBois S.à r.l., Luxembourg
Vordere Zollamtsstraße 13 GmbH, Vienna
WFC Investments Sp. z o.o., Warsaw
Windpark Zistersdorf GmbH, Pottenbrunn
Yorktown Financial Companies Inc., Minneapolis, MN
ZAD Allianz Bulgaria, Sofia
ZAD Allianz Bulgaria Zhivot, Sofia
ZAD Energia, Sofia
ZiOst Energy GmbH & Co. KG, Pottenbrunn
Joint ventures
A&A Centri Commerciali S.r.l., Milan
Allee-Center Kft., Budapest
AMLI-Allianz Investment LP, Wilmington, DE
AZ/JH Co-Investment Venture (DC) LP, Wilmington, DE
AZ/JH Co-Investment Venture (IL) LP, Wilmington, DE
Companhia de Seguro de Créditos S.A., Lisbon
Euromarkt Center d.o.o., Ljubljana
Fiumaranuova S.r.l., Genoa
Guotai Jun'an Allianz Fund Management Co. Ltd.,
Shanghai
International Shopping Centre Investment S.A.,
Luxembourg
Israel Credit Insurance Company Ltd., Tel Aviv
Italian Shopping Centre Investment S.r.l., Milan
NRF (Finland) AB, Västeras
Porterbrook Holdings I Limited, London
Queenspoint S.L., Madrid
SC Holding SAS, Paris
SES Shopping Center AT1 GmbH, Salzburg
Solunion Compañía Internacional de Seguros y
Reaseguros SA, Madrid
TopTorony Ingatlanhasznosító Zrt., Budapest
Waterford Blue Lagoon LP, Wilmington, DE
Owned1
%
100.0
100.0
100.0
100.0
100.0
100.0
100.0
90.0
100.0
100.0
100.0 3
100.0
100.0
100.0
100.0
100.0
100.0
100.0
75.0
100.0
100.0
100.0 3
100.0 3
94.8
100.0 3
100.0 3
66.0 3
100.0 3
100.0 3
100.0
100.0 3
100.0 3
100.0 3
100.0
100.0
100.0
100.0
100.0 3
100.0
100.0
100.0
100.0 3
100.0
87.5
100.0 3
100.0 3
87.4 3
99.0 3
51.0 3
100.0 3
50.0 3
50.0 3
75.0
80.0 3
80.0 3
50.0 3
50.0 3
50.1 3
49.0 3
50.0 3
50.0 3
50.0
50.0 3
30.0 3
50.0 3
50.0 3
50.0 3
50.0 3
50.0 3
49.0 3
Equity
€ thou
116,896
112,676
247,976
541,251
270,791
102,417
344,603
305,976
643,152
118,416
47,420
55,638
119,362
222,599
120,483
111,864
232,728
38,119
105,967
265,836
177,235
5,996
77,514
314,003
31,410
1,205,821
12,010
14,347
51,723
5,561
5,179
183,668
19,283
5,494
5,882
8,865
17,801
19,215
49,038
199,509
91,007
20,376
74,967
228,055
8,548
129,082
28,895
18,467
27,132
9,765
158,476
99,253
191,281
238,151
214,631
48,050
110,375
172,397
Net
Earnings
€ thou
4,495
4,380
8,618
3,085
12,869
3,495
15,613
3,529
25,198
2,955
(4,344)
964
4,162
6,998
5,413
2,041
2,420
3,795
2,702
11,290
6,400
721
(2,283)
6,888
700
2,760
217
291
2,092
(30)
1,622
26,701
(820)
(17)
585
1,008
(5,089)
1,592
1,279
18,947
8,043
954
1,830
17,467
(252)
–
5,343
4,496
8,949
15
6,180
10,421
(2,647)
(3,356)
515
8,033
6,927
11,021
74,997
26,606
192,721
34,745
21,198
103,519
1,600,198
107,561
9,636
163,358
99,030
12,111
314,410
135,381
7,421
(3,925)
29,354
93,878
(1,294)
(5)
3,790
6,235
(1,544)
(279)
Associates
Allianz Saudi Fransi Cooperative Insurance Company,
Riyadh
Archstone Multifamily Partners AC JV LP, Wilmington, DE
Archstone Multifamily Partners AC LP, Wilmington, DE
Areim Fastigheter 2 AB, Stockholm
Bajaj Allianz General Insurance Company Ltd., Pune
Bajaj Allianz Life Insurance Company Ltd., Pune
Bazalgette Equity Ltd., London
Brunei National Insurance Company Berhad Ltd., Bandar
Seri Begawan
Chicago Parking Meters LLC, Wilmington, DE
CPIC Allianz Health Insurance Co. Ltd., Shanghai
Douglas Emmett Partnership X LP, Wilmington, DE
Four Oaks Place LP, Wilmington, DE
Helios Silesia Holding B.V., Amsterdam
Henderson UK Outlet Mall Partnership LP, Edinburgh
OeKB EH Beteiligungs- und Management AG, Vienna
Residenze CYL S.p.A., Milan
SAS Alta Gramont, Paris
SCI Bercy Village, Paris
SK Versicherung AG, Vienna
SNC Alta CRP Gennevilliers, Paris
SNC Alta CRP La Valette, Paris
SNC Société d'aménagement de la Gare de l'Est, Paris
Solveig Gas Holdco AS, Oslo
Other participations below 20 % of voting rights
Advent International GPE VI LP, George Town
Advent International GPE VII LP, Wilmington, DE
Al Nisr Al Arabi, Amman
Altor Fund III (No.2) LP, Saint Helier
Apax Europe VII - A (Feeder) LP, Edinburgh
Bain Capital Fund XI LP, George Town
Banco BPI S.A., Porto
Baring Asia Private Equity Fund V LP, George Town
Beacon Capital Strategic Partners VII LP, Wilmington, DE
Berkshire Fund VIII-A LP, Wilmington, DE
Boyu Capital Fund II LP, George Town
Bridgepoint Europe IV 'F' LP, London
Burza cennych paperov v, Bratislava
Carlyle Europe Partners IV LP, George Town
CDH Fund V LP, George Town
Comisariado Español Marítimo, S.A., Madrid
Commercial Bank of Cameroon, LC, Douala
CVC Capital Partners Asia Pacific IV LP, George Town
CVC Capital Partners VI LP, Saint Helier
CVC European Equity Partners V A LP, Saint Helier
EQT VI LP, St Peter Port
EQT VII (No. 1) LP, London
Hellman & Friedman Capital Partners VII LP,
George Town
IDI, Paris
Investindustrial V LP, Saint Helier
IPUT plc, Dublin
Kelso Investment Associates VIII, L.P., Wilmington, DE
LBA Reality Fund V L.P., Dover, DE
Nordic Capital VII Alpha, L.P., St Helier
Onex Partners III LP, George Town
Onex Partners IV LP, George Town
Permira V LP, St Peter Port
Resolute Fund III LP, New York, NY
SG Cameroun, LC, Douala
SG Cote d'Ivoire, LC, Abidjan
Sri Ayudhya Capital Public Company Limited, Bangkok
TDR Capital III 'B' L.P., London
TPG Asia VI LP, George Town
TPG Partners VI, L.P., George Town
Trident V, L.P., George Town
Zagrebacka banka d.d., Zagreb
Owned1
%
Equity
€ thou
Net
Earnings
€ thou
32.5
40.0
28.6
23.3 3
26.0 3
26.0 3
34.3
25.0 3
49.9 3
22.9 3
28.6 3
49.0 3
45.0 3
19.5
49.0 3
33.3 3
49.0
49.0
25.8 3
49.0
49.0
49.0
30.0 3
2.2
1.2
18.0 3
4.9
9.7
2.5
8.5 3
2.5
19.7 3
5.1
3.3
10.7
5.1 3
4.7
3.1
6.2 3
10.0 3
3.9
1.3
2.1
9.6
2.8
0.9
5.4 3
3.5
14.2 3
1.7
16.1 3
3.0
3.3
2.7
2.7
3.1
16.3 3
7.3 3
16.8 3
7.0
3.0
0.5
3.7
11.7 3
57,138
85,977
165,272
166,188
338,016
1,014,313
162,020
9,639
218,094
124,072
71,711
445,165
80,314
445,589
121,757
120,058
277,751
44,901
13,240
32,827
21,599
14,180
311,715
2,327,605
8,765,260
24,855
514,754
252,202
2,946,148
2,407,000
2,369,978
182,313
988,831
1,160,150
288,518
476,652
1,577,936
1,554,159
496,582
18,294
955,027
5,737,729
2,203,252
978,613
2,009,247
8,356,752
277,132
1,083,769
1,766,090
3,115,495
404,225
2,099,579
2,835,749
2,859,524
4,851,652
1,627,147
77,215
25,916
176,577
595,485
1,783,237
11,123,052
1,960,296
2,225,430
652
(619)
(57,235)
(2,410)
61,777
102,080
–
1,550
24,308
(9,180)
(74)
11,304
(6,113)
174,271
10,167
871
2,233
7,922
835
1,797
(1,175)
2,770
58,144
–
–
2,593
–
–
–
236,400
–
28,167
–
–
–
173,023
–
–
266,337
–
–
–
–
–
–
–
32,539
–
333,199
–
39,923
–
–
–
–
–
13,161
41,204
15,686
–
–
–
–
19,388
1
2
3
4
5
Percentage includes equity participations held by dependent entities in full, even if the Allianz Group’s
share in the dependent entity is below 100 %.
Profit and loss transfer agreement.
As per annual financial statement 2015.
Insolvent. Dependent entities are shown in a way, which reflects the state as of the date of filing for
insolvency.
As per annual financial statement 2010. This is only applicable for manroland ag and their subsidiaries.
74
Annual Report 2016
Allianz se
C
Financial Statements of Allianz SE
Further Information
Responsibility statement
To the best of our knowledge, and in accordance with the applicable
reporting principles, the financial statements of Allianz SE give a true
and fair view of the assets, liabilities, financial position and profit or
loss of the company, and the management report includes a fair
review of the development and performance of the business and the
position of the company, together with a description of the principal
opportunities and risks associated with the expected development of
the company.
Munich, 14 February 2017
Allianz SE
The Board of Management
Annual Report 2016
Allianz SE
75
C
Financial Statements of Allianz SE
Auditor’s report
We have audited the annual financial statements, comprising the
balance sheet, the income statement and the notes to the financial
statements, together with the bookkeeping system, and the manage-
ment report of the Allianz SE, Munich, for the business year from
1 January to 31 December 2016. The maintenance of the books and
records and the preparation of the annual financial statements and
management report in accordance with German commercial law
and supplementary provisions of the articles of incorporation are the
responsibility of the Company’s management. Our responsibility is
to express an opinion on the annual financial statements, together
with the bookkeeping system, and the management report based on
our audit.
We conducted our audit of the annual financial statements in
accordance with § 317 HGB [“Handelsgesetzbuch“: “German Com-
mercial Code“] and German generally accepted standards for the
audit of financial statements promulgated by the Institut der
Wirtschaftsprüfer [Institute of Public Auditors in Germany] (IDW).
Those standards require that we plan and perform the audit such
that misstatements materially affecting the presentation of the net
assets, financial position and results of operations in the annual
financial statements in accordance with German principles of pro per
accounting and in the management report are detected with reason-
able assurance. Knowledge of the business activities and the eco-
nomic and legal environment of the Company and expectations as to
possible misstatements are taken into account in the determination
of audit procedures. The effectiveness of the accounting-related
internal control system and the evidence supporting the disclosures
in the books and records, the annual financial statements and the
management report are examined primarily on a test basis within
the framework of the audit. The audit includes assessing the accoun-
ting principles used and significant estimates made by management,
as well as evaluating the overall presentation of the annual financial
statements and management report. We believe that our audit pro-
vides a reasonable basis for our opinion.
Our audit has not led to any reservations.
In our opinion, based on the findings of our audit, the annual
financial statements comply with the legal requirements and supple-
mentary provisions of the articles of incorporation and give a true
and fair view of the net assets, financial position and results of ope-
rations of the Company in accordance with German principles of
proper accounting. The management report is consistent with the
annual financial statements, complies with the German statutory
requirements, and as a whole provides a suitable view of the Com-
pany’s position and suitably presents the opportunities and risks of
future development.
Munich, 1 March 2017
KPMG AG
Wirtschaftsprüfungsgesellschaft
Becker
Wirtschaftsprüfer
(Independent Auditor)
Dr. Pfaffenzeller
Wirtschaftsprüfer
(Independent Auditor)
76
Annual Report 2016
Allianz SE
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Allianz SE – Königinstrasse 28 – 80802 Munich – Germany – Phone +49 89 3800 0 – info@allianz.com – www.allianz.com
Annual report on the internet: www.allianz.com/annualreport – Design/Concept: hw.design GmbH – Date of publication: 10 March 2017
This is a translation of the German Annual Report of Allianz SE. In case of any divergences, the German original is legally binding.