In the third quarter of 2012, ALLIANZ continued its momentum from the first half of the year. As in the first two quarters, revenues, operating profit and net income increased compared to the respective quarter in 2011. Total revenues for the third quarter of 2012 grew to EUR 25.2 billion from EUR 24.1 billion in 2011, an increase of 4.7%. Quarterly operating profit rose 32.8% to EUR 2.5 billion. All three business segments saw improvements. "The third quarter contributed significantly to our very strong nine-month results," said Michael Diekmann, CEO of Allianz SE. "Especially in challenging times, customers are looking for reliability in insurance and investments."
The conglomerate solvency ratio as of September 30, 2012 was 190%, an increase of 4 pp from 186% as of June 30, 2012. Shareholders' equity over the same period grew 8.1% to EUR 51.915 billion.
Following the strong operating performance, Allianz expects the 2012 full year operating profit to exceed EUR 9 billion, assuming no adverse developments during the remainder of the year. Net income development will continue to be influenced by balance sheet strengthening including investment de-risking and restructuring activities.
CEE Property & Casualty
In Central and Eastern Europe gross premiums decreased to EUR 567 million in the third quarter, including unfavorable foreign currency translation effects of EUR 2 million. The decrease of 5.0 % was mainly attributable to the Group's motor business in Poland as well as to industrial property business in Russia and selective underwriting in the Russian health portfolio. As a result, gross premiums written by the CEE subsidiaries of ALLIANZ reached EUR 1,84 billion in 3Q2012, about 8% less y-o-y.
The CEE markets generated an consolidated operating profit figure of EUR 122 million in 3Q2012, with a peak of EUR 49 million in Slovakia, followed by the EUR 24 million reported by the Czech subsidiary and the EUR 19 million contribution of the Hungarian arm. After ending the third quarter with a negative result EUR 4 million, the Polish business of ALLIANZ recorded for the first nine months of 2012 a modest positive result (EUR 7 million) in terms of operating of profitability.
CEE combined ratio reached 97.5% after 3Q2012, a fairly stable value as compared to 3Q2011 (96.7%). ALLIANZ companies in Bulgaria, Slovakia, Czech Republic and Croatia managed to achieve less than average combined ratios, with a remarkable performance in Ukraine, where 77.5% combined ratio of 2012 represents an obvious improvement, as compared to the 118.7% value recorded in 3Q2011. In Hungary however, the combined ratio's value augmented from 98.5% in 3Q2011, to 101.5% in 3Q2012, while the loss ratio also increased from 56.1% to 60%.
Premiums in Central and Eastern Europe decreased in the third quarter by 16.3 % y-o-y, to EUR 218 million, after adjusting for EUR 1 million adverse foreign currency translation effects. Increased sales of investment-oriented products in the Czech Republic and growth in Russia partially offset the decline from high third quarter levels in 2011, driven by sales campaigns, in Poland and Hungary. Looking at the first nine months of 2012, GWP amounted to EUR 948 million, up by 12.5% y-o-y.
In terms of profitability, the operating profit of the CEE life insurance units amounted to the aggregate value of EUR 64 million, with the best results belonging to Slovakia, Czech Republic and Poland (EUR 26 million, EUR 16 million and EUR 13 million respectively).
Full 3Q2012 interim report of ALLIANZ is available here.