Allianz, the insurance company, announced that the firm would sell a major stake in its Russian operations to Interholding. The firm aims at paring its footprint in the country after the invasion. Currently, Interholding is the owner of Russian insurer Zetta Insurance. In this place, Allianz would retain around 49.9% stake. This partial sale would give Allianz additional net profit of 400m euros.
This transaction could take place only if they receive regulatory approvals. However, this transaction could inflict a negative impact of around 0.4bn euros on Allianz’s profit and loss account. This is because the reclassification of negative foreign exchange could affect shareholders’ equity. On the other hand, the Allianz Group’s solvency capitalization and cash position would not get the impact.
Allianz’s decision is whether or not the firm could scale back operations in Russia. So, the company wants to ensure continuity for clients and employees. So far, Interholding Zetta Insurance owns more than 120 points of sales in Russia only. This is with up to 6.500 agents in more than 150 cities in Russia. The potential also occurs in the customers. They have over 1 million small and medium enterprise clients. Their partnership covers at least 350 car dealers and 30 commercial banks in the country.
Allianz itself is the world’s leading insurer with 126 million private and corporate customers in more than 70 countries. Allianz aims at extending its services globally. In terms of investment, Allianz is the largest investor managing more than 767bn euros for its insurance customers. Their asset managers PIMCO and Allianz Global Investors also manage around 1.9trn euros of third-party assets. The Dow Jones Sustainability Index has included the company among the leaders in the insurance industry.
